Exhibit 4.8
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DATED 3 MAY 2002
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NESTLE UK LTD. (1)
AND
NESTLE (IRELAND) LIMITED (2)
AND
PREMIER AMBIENT PRODUCTS (UK) LIMITED (3)
AND
PASTAM LIMITED (4)
AND
PREMIER FINANCING LIMITED (5)
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AGREEMENT
FOR THE SALE AND PURCHASE OF THE AMBIENT FOOD BUSINESSES OF
NESTLE UK LTD. AND NESTLE (IRELAND) LIMITED
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CMS CAMERON MCKENNA
MITRE HOUSE
160 ALDERSGATE STREET
LONDON EC1A 4DD
T +44(0)20 7367 3000
F +44(0)20 7367 2000
TABLE OF CONTENTS
1. INTERPRETATION..................................................2
2. SALE AND PURCHASE..............................................17
3. CONSIDERATION..................................................17
4. COMPLETION.....................................................18
5. INTERIM PERIOD.................................................22
6. CREDITORS AND RECEIVABLES......................................24
7. SELLERS' POST COMPLETION OBLIGATIONS...........................25
8. BUYERS' POST COMPLETION OBLIGATIONS............................26
9. ASSUMED LIABILITIES AND EXCLUDED LIABILITIES...................27
10. APPORTIONMENTS, PREPAYMENTS AND DISCOUNTS......................27
11. COMPLETION STATEMENT...........................................30
12. CONTRACTS AND THIRD PARTY CONSENTS.............................31
13. EMPLOYEES......................................................32
14. RISK AND INSURANCE.............................................34
15. VALUE ADDED TAX................................................35
16. WARRANTIES.....................................................37
17. BUYER'S WARRANTIES.............................................38
18. PROTECTION OF GOODWILL.........................................38
19. ANNOUNCEMENTS..................................................39
20. CONFIDENTIALITY................................................39
21. ASSIGNMENT.....................................................40
22. COSTS..........................................................40
23. ENTIRE AGREEMENT...............................................40
24. WAIVER, AMENDMENT..............................................41
25. FURTHER ASSURANCE..............................................42
26. NOTICES........................................................42
27. COUNTERPARTS...................................................43
28. GOVERNING LAW..................................................44
29. INVALIDITY.....................................................44
30. PENSIONS.......................................................44
31. INDEPENDENT EXPERT.............................................44
32. THIRD PARTY RIGHTS.............................................45
33. RESTRICTED FINANCIAL TRANSFERS.................................45
34. GUARANTEE......................................................45
SCHEDULE 1 Excluded Assets.............................................
SCHEDULE 2 Allocation of Consideration.................................
SCHEDULE 3 Warranty Statements.........................................
1. Capacity of the Sellers........................................
2. The Assets.....................................................
3. Contracts and commitments......................................
4. Transactions with Connected Persons............................
5. Financial Information..........................................
6. Post-Balance Sheet Date events.................................
7. Consents and Licences..........................................
8. Litigation.....................................................
9. Government enquiries...........................................
10. Properties.....................................................
11. Employment.....................................................
12. Trading........................................................
13. Pensions.......................................................
14. Stamp duty.....................................................
15. VAT Regulations................................................
16. Capital Goods Scheme...........................................
17. Option to Tax..................................................
18. Special Arrangements...........................................
19. Tax Charges and Powers of Sale.................................
20. VAT............................................................
21. Capital Allowances.............................................
22. Grants.........................................................
SCHEDULE 4 UK Properties Part 1.....................................
1. Definitions....................................................
2. General provisions.............................................
3. Standard Conditions............................................
4. Sale and purchase..............................................
5. Completion.....................................................
6. Title..........................................................
7. Matters subject to which the UK Properties are sold............
8. Condition of the UK Properties.................................
9. The Transfer...................................................
SCHEDULE 5 Irish Property Part 1......................................
Part 2 Sale of Irish Property..........................................
SCHEDULE 6 Pensions....................................................
Part 2 Irish Pensions..................................................
SCHEDULE 7 Limitations on Liability....................................
1. General........................................................
2. Minimum and maximum claims.....................................
3. Time limits for bringing claims................................
4. Conduct of litigation..........................................
5. Recovery.......................................................
6. Contingent Liabilities.........................................
7. Acts of the Buyers.............................................
8. Financial Accounts.............................................
9. Retrospective legislation......................................
10. Buyer's knowledge..............................................
11. Disclosure.....................................................
12. Reduction of Cash Consideration................................
SCHEDULE 8 Third Party Insurance Policies..............................
SCHEDULE 9 Financial Information.......................................
SCHEDULE 10 Employees Part 1 - Assumed UK Employees...................
Part 2 - Assumed Irish Employees........................................
Part 3 - Head Office Employees..........................................
SCHEDULE 11 Vehicles Part 1 - UK Vehicles.............................
Part 2 - Irish Vehicles.................................................
SCHEDULE 12 Stock Valuation Policy.....................................
Extract from Nestle Accounting Standards................................
INVENTORIES.............................................................
Definitions.............................................................
Recognition.............................................................
Measurement.............................................................
SCHEDULE 13 IT Part 1 - UK IT.........................................
Part 2 - Irish IT.......................................................
Appendix A Data Room Documents Index...................................
Appendix B Excluded Irish Assets.......................................
THIS AGREEMENT is made on 3 May 2002
BETWEEN:
(1) NESTLE UK LTD. (registered in England and Wales with number 51491)
whose registered office is at St. George's House, Croydon, Surrey,
CR9 1NR ("NESTLE UK");
(2) NESTLE (IRELAND) LIMITED (registered in Ireland with number 1614)
whose registered office is at Blessington Road, Tallaght, County
Dublin ("NESTLE IRELAND");
(3) PREMIER AMBIENT PRODUCTS (UK) LIMITED (registered in England and
Wales with number 4427006) whose registered office is at 28 The
Green, Kings Norton, Birmingham B38 8SD (the "UK BUYER");
(4) PASTAM LIMITED (registered in Ireland with number 323282) whose
registered office is at c/o Arthur Cox, Arthur Cox Building,
Earlsfort Terrace, Dublin 2 (the "IRISH BUYER"); and
(5) PREMIER FINANCING LIMITED (registered in England and Wales with
number 03716362) whose registered office is at 28 The Green, Kings
Norton, Birmingham, B38 8SD (the "GUARANTOR").
RECITALS
(A) Nestle UK carries on the UK Business and is the beneficial owner,
or is otherwise able to procure the transfer, of the UK Assets and
the UK Properties.
(B) Nestle Ireland carries on the Irish Business and is the beneficial
owner, or is otherwise able to procure the transfer, of the Irish
Assets and the Irish Property.
(C) The Sellers have agreed to sell, and the Buyers have agreed to
purchase, each Relevant Business as a going concern, comprising the
Relevant Assets and the Relevant Property on the terms hereinafter
set out.
(D) The Guarantor has agreed to guarantee the obligations of the Buyers
in favour of the Sellers on the terms hereinafter set out.
THE PARTIES AGREE AS FOLLOWS:
1. INTERPRETATION
1.1 In this Agreement (including the recitals) the following words and
expressions shall, unless the context otherwise requires, have the
following meanings:
"ACCOUNTS DATE" means 31st December 2001;
"AFFILIATE" means, in relation to any body corporate (a) its
ultimate parent undertaking and (b) any subsidiary or subsidiary
undertaking of such body corporate or of its ultimate parent
undertaking;
2
"AGREED FORM" means, in relation to any document, in the form
agreed between the Relevant Parties on or prior to the date hereof
and, for the purposes of identification, signed on their behalf;
"THIS AGREEMENT" means this agreement, including the recitals and
the schedules;
"APPORTIONMENT ACCOUNT" means the apportionment account referred to
in schedule 5;
"ASSETS" means the UK Assets and the Irish Assets (and "RELEVANT
ASSETS" means the UK Assets or the Irish Assets, as the context may
require);
"ASSUMED EMPLOYEES" means the Assumed UK Employees and the Assumed
Irish Employees (and "RELEVANT ASSUMED EMPLOYEES" means the Assumed
UK Employees or the Assumed Irish Employees, as the context may
require);
"ASSUMED IRISH EMPLOYEES" means those persons identified in the
list headed "Assumed Irish Employees" set out in part 2 of schedule
10 who are employed by Nestle Ireland or any other member of the
Sellers' Group on Irish Completion and are assigned to the Irish
Business, subject to any changes (made in accordance with clause
5.1.5) notified to the Irish Buyer by Nestle Ireland prior to Irish
Completion;
"ASSUMED IRISH LIABILITIES" means all present and future
liabilities and obligations of Nestle Ireland in respect of the
Irish Business as at Irish Completion other than the Excluded Irish
Liabilities;
"ASSUMED LIABILITIES" means (a) the Assumed UK Liabilities and (b)
the Assumed Irish Liabilities;
"ASSUMED UK EMPLOYEES" means those persons identified in the list
headed "Assumed UK Employees" set out in part 1 of schedule 10 who
are employed by Nestle UK or any other member of the Sellers' Group
on UK Completion and are assigned to the UK Business, subject to
any changes (made in accordance with clause 5.1.5) notified to the
UK Buyer by Nestle UK prior to UK Completion;
"ASSUMED UK LIABILITIES" means all present and future liabilities
and obligations of Nestle UK in respect of the UK Business as at UK
Completion other than the Excluded UK Liabilities;
"BUSINESS" means the UK Business and the Irish Business (and
"RELEVANT BUSINESS" means the UK Business or the Irish Business, as
the context may require);
"BUSINESS DAY" means a day (excluding Saturdays, Sundays and public
holidays) on which banks are open for the transaction of normal
banking business in London and Dublin;
3
"BUYERS" means the UK Buyer and the Irish Buyer, and each of them
and either of them as the context admits (and "RELEVANT BUYER"
means the UK Buyer or the Irish Buyer, as the context may require);
"BUYERS' GROUP" means the Buyers and any Affiliate of the Buyers
for the time being, and all of them and any of them as the context
admits;
"CAA" means the Capital Allowances Act 2001;
"CASH CONSIDERATION" means the aggregate of the UK Cash
Consideration and the Irish Cash Consideration;
"COMPANIES ACT" means the Companies Act 1985 (as amended by the
Companies Act 1989);
"COMPLETION" means, in relation to the sale and purchase of the UK
Business, UK Completion and, in relation to the sale and purchase
of the Irish Business, Irish Completion;
"COMPLETION DATE" means the UK Completion Date or the Irish
Completion Date (as the context may require);
"COMPLETION STATEMENT" means the UK Completion Statement or the
Irish Completion Statement (as the context may require);
"CONNECTED PERSON" means any person connected (within the meaning
of section 839 Taxes Act 1988) with the Sellers or any other member
of the Sellers' Group, or with any of their respective directors;
"CONTRACT" means a UK Contract or an Irish Contract (as the context
may require);
"CREDITORS" means the UK Creditors and the Irish Creditors;
"CUSTOMS" means H. M. Customs & Excise;
"DATA ROOM DOCUMENTS" means the data room documents referred to in
the index set out in Appendix A and attached to the Disclosure
Letter;
"DISCLOSURE LETTER" means the letter of today's date together with
the attachments thereto addressed by the Sellers to the Buyers
disclosing exceptions to the Warranties;
"DOMAIN NAMES" means the domain names www.crosseandblackwell.co.uk,
www.galeshoney.co.uk, www.sarsons.co.uk, www.sunpat.co.uk,
www.waistline.co.uk, www.wobbleweb.co.uk, www.wwwobble.co.uk,
www.saveourtakeaways.com and www.saveourtakeaways.co.uk together
with any other domain names used exclusively in the UK Business
and/or the Irish Business, but not including
www.crosseandblackwell.com;
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"DOMAIN NAME TRANSFERS" means transfers of the Domain Names in the
form prescribed by Nominet UK, Verisign, Inc. or any other relevant
domain name registration authority;
"EASEMENT" means a Deed of Easement dated 5 February 1999 between
(1) George Longden Limited and (2) Nestle UK relating to the UK
Property at Hadfield;
"EFFECTIVE TIME" means, in relation to the sale and purchase of the
UK Business, midnight on the day immediately prior to the UK
Completion Date, and in relation to the sale and purchase of the
Irish Business, midnight on the day immediately prior to the Irish
Completion Date;
"ENCUMBRANCE" means any mortgage, charge, pledge, lien, security or
other third party right or interest (legal or equitable) or
restriction over or in respect of the use of the relevant asset,
security or right;
"ENDORSER BRANDS" means the "Nestle" and "Mackintosh" logos used by
Nestle Ireland to endorse the "Double Centre", "Yorkshire Toffee",
"Scots Clan" and "Or Toffee" brands in Ireland;
"EURO" and "(EURO)" means the European single currency being the
lawful currency of Ireland;
"EXCLUDED IRISH ASSETS" means any assets or rights and the benefit
of any claims consisting of or comprised in the following:
(a) the Irish Receivables;
(b) the Excluded Irish IT;
(c) the Irish Shared Contracts;
(d) cash in hand or at the bank relating to the Irish Business;
(e) the Irish Business Intellectual Property;
(f) amounts recoverable in respect of Irish corporation tax
which relate to the Irish Business and which are
attributable to the period ended, or transactions
occurring, on or before the Irish Completion Date;
(g) the benefit of any insurance policy of Nestle Ireland or
any other member of the Sellers' Group relating to the
Irish Business or any of the Irish Assets, Irish
Property or Assumed Irish Employees, save for any
Insurance Claim; and
(h) the list headed "Excluded Irish Assets" set out in part 2
of schedule 1;
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"EXCLUDED IRISH IT" means any Hardware or Software owned or used by
Nestle Ireland or any other member of the Sellers' Group in
relation to the Irish Business other than Irish IT;
"EXCLUDED IRISH LIABILITIES" means the following liabilities of
Nestle Ireland or any Affiliate arising from its/their conduct of
the Irish Business or ownership of the Irish Assets and Irish
Property:
(a) all liabilities of Nestle Ireland to Taxation;
(b) all amounts owed by Nestle Ireland to any third party
or any member of the Sellers' Group by way of
overdraft or other borrowings;
(c) the Irish Creditors;
(d) all liabilities of Nestle Ireland for breach of the
Irish Contracts, to the extent that such breach occurs
prior to the Irish Completion Date;
(e) all product liability and other claims relating to
products manufactured by Nestle Ireland prior to the
Irish Completion Date, provided that such claims do
not arise from the storage, handling or distribution
of such products by the Irish Buyer (or any Affiliate)
on or after the Irish Completion Date otherwise than
in accordance with the business practices of the Irish
Business adopted prior to Irish Completion;
(f) all liabilities which Nestle Ireland specifically
agrees to retain pursuant to this Agreement; and
(g) any liability arising out of a breach of law
applicable to the Irish Business by Nestle Ireland or
by any of the employees of the Irish Business in
circumstances where (and to the extent that) Nestle
Ireland is vicariously liable, in each case, prior to
Irish Completion;
"EXCLUDED LIABILITIES" means the Excluded UK Liabilities and the
Excluded Irish Liabilities;
"EXCLUDED UK ASSETS" means any assets or rights and the benefit of
any claims consisting of or comprised in the following:
(a) the UK Receivables;
(b) the Excluded UK IT;
(c) the UK Shared Contracts;
(d) cash in hand or at the bank relating to the UK
Business;
(e) the UK Business Intellectual Property;
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(f) amounts recoverable in respect of UK corporation tax
which relate to the UK Business and which are
attributable to the period ended, or transactions
occurring, on or before the UK Completion Date;
(g) the benefit of any insurance policy of Nestle UK or
any other member of the Sellers' Group relating to the
UK Business or any of the UK Assets, UK Properties or
Assumed UK Employees, save for any Insurance Claim;
and
(h) the list headed "Excluded UK Assets" set out in part 1
of schedule 1;
"EXCLUDED UK IT" means any Hardware or Software owned or used by
Nestle UK or any other member of the Sellers' Group in relation to
the UK Business other than UK IT;
"EXCLUDED UK LIABILITIES" means the following liabilities of Nestle
UK or any Affiliate arising from its/their conduct of the UK
Business or ownership of the UK Assets and UK Properties:
(a) all liabilities of Nestle UK to Taxation;
(b) all amounts owed by Nestle UK to any third party or
any member of the Sellers' Group by way of overdraft
or other borrowings;
(c) the UK Creditors;
(d) all liabilities of Nestle UK for breach of the UK
Contracts, to the extent that such breach occurs prior
to the UK Completion Date;
(e) all product liability and other claims relating to
products manufactured by Nestle UK prior to the UK
Completion Date, provided that such claims do not
arise from the storage, handling or distribution of
such products by the UK Buyer (or any Affiliate) on or
after the UK Completion Date otherwise than in
accordance with the business practices of the UK
Business adopted prior to UK Completion;
(f) all liabilities which Nestle UK specifically agrees to
retain pursuant to this Agreement; and
(g) any liability arising out of a breach of law
applicable to the UK Business by Nestle UK or by any
of the employees of the UK Business in circumstances
where (and to the extent that) Nestle UK is
vicariously liable, in each case, prior to UK
Completion;
"FINANCIAL INFORMATION" means the information set out in schedule
9;
"HARDWARE" means any and all computer, telecommunications and
network equipment and any aspect or asset of a business which
relies in any respect on computer hardware or other information
technology (whether embedded or not);
7
"HEAD OFFICE EMPLOYEES" means those of the Assumed UK Employees
whose principal place of work is at St George's House, Croydon and
who are identified in the list headed "Head Office Employees" set
out in part 3 of schedule 10;
"INDEPENDENT EXPERT" shall have the meaning given to it in clause
31;
"INSURANCE CLAIM" means the benefit of any claim which arises
before Completion pursuant to any Third Party Insurance Policy in
relation to any loss or damage to the Relevant Assets and Relevant
Property;
"INTELLECTUAL PROPERTY" means any and all patents, trade marks,
service marks, get-up, trade and business names, domain names,
logos, copyright (including copyright in computer software), rights
in design, database rights and topography rights (whether
registered or not and including any applications to register or
rights to apply for registration of any of the foregoing including
the right to rely on any convention priority period), rights in
inventions, Know-How, and all other intellectual property rights or
forms of protection of a similar or equivalent nature or effect
anywhere in the world;
"IRELAND" means Ireland, excluding Northern Ireland;
"IRISH ASSETS" means the Irish Business Claims, Irish Goodwill,
Irish Books and Records, Irish Contracts, Irish Fixed Plant, Irish
Loose Plant, Irish Local Intellectual Property, Irish Local
Know-How, Irish Vehicles, Irish IT and Irish Stock and all other
property, rights and assets (other than the Excluded Irish Assets)
owned by Nestle Ireland and used, enjoyed or exercised exclusively
in the Irish Business on Irish Completion;
"IRISH BOOKS AND RECORDS" means the lists of customers and
suppliers of the Irish Business, and all other records exclusively
relating to the Irish Business;
"IRISH BUSINESS" means the business carried on by Nestle Ireland
and Nestle Distribution (Ireland) Limited at or from the Irish
Property comprising (a) the production, marketing and sale of the
Irish Products; (b) the production of private label and other
products manufactured at the Irish Property; and (c) the sales and
marketing and other ancillary functions of Nestle Ireland carried
on from the Irish Property relating to the Irish Products and the
private label and other products manufactured at the Irish Property
together with the Snack 5 Business;
"IRISH BUSINESS CLAIMS" means the benefit of all rights,
entitlements or claims to which Nestle Ireland is entitled (other
than claims arising under any policy of insurance) arising directly
out of or in connection with the operation by Nestle Ireland of the
Irish Business prior to Irish Completion, but only to the extent
that such rights, entitlements and claims are freely assignable by
Nestle Ireland without the consent of a third party;
"IRISH BUSINESS INTELLECTUAL PROPERTY" means all Intellectual
Property owned or used by Nestle Ireland or any other member of the
Sellers' Group other than the Irish Local Intellectual Property and
the Irish Local Know-How;
8
"IRISH CASH CONSIDERATION" means the sum of(pound)10,240,005
(exclusive of VAT);
"IRISH CHARGE" means the trust deed dated 4 February 1930,
registered against Nestle Ireland and granted in favour of British
Trust Association Limited;
"IRISH COMPLETION" means completion of the sale and purchase of the
Irish Business, Irish Assets and Irish Property in accordance with
the terms set out in this Agreement;
"IRISH COMPLETION DATE" means the date on which Irish Completion
takes place (or is scheduled to take place) pursuant to clause 4.6,
or such other date as the Relevant Parties shall agree;
"IRISH COMPLETION STATEMENT" means the statement of apportionments
required to be prepared in relation to the Irish Business pursuant
to clause 11;
"IRISH CONTRACTS" means all contracts, agreements and arrangements
entered into by Nestle Ireland or any other member of the Sellers'
Group which are wholly or partly unperformed at the Irish
Completion Date and which relate exclusively to the Irish Business,
but excluding:
(a) contracts of employment with the Assumed Irish
Employees; and
(b) any contracts which are Excluded Irish Assets;
"IRISH CREDITORS" means the aggregate amount of all book, trade and
other debts (including, without limitation, financial debt) and
sums due (including credit notes granted and sums payable in
respect of any breach by Nestle Ireland of any Material Contract
prior to Irish Completion), owing, accrued or payable by Nestle
Ireland in respect of the Irish Business (whether or not invoiced
and whether or not then due and payable) which relate to, or have
been incurred in, the period up to Irish Completion (including,
without limitation, in respect of goods and services provided to
the Irish Business up to Irish Completion);
"IRISH FIXED PLANT" means the fixed plant, machinery and equipment
used or intended for use exclusively in the Irish Business attached
or fixed to the Irish Property;
"IRISH GOODWILL" means the exclusive right for the Irish Buyer to
represent itself as carrying on the Irish Business in succession to
Nestle Ireland;
"IRISH IT" means the Hardware listed in part 2 of schedule 13;
"IRISH LOCAL INTELLECTUAL PROPERTY" means that Intellectual
Property owned by Nestle Ireland and used exclusively in the Irish
Business;
"IRISH LOCAL INTELLECTUAL PROPERTY ASSIGNMENT" means the deed under
which the Irish Local Intellectual Property is to be assigned by
Nestle Ireland to the Irish Buyer;
9
"IRISH LOCAL KNOW-HOW" means any Know-How used exclusively in the
Irish Business including shop practices, instructions and training
manuals, market forecasts, quotations and marketing methods and
procedures;
"IRISH LOOSE PLANT" means the movable plant, machinery, equipment,
spare parts, tooling and furniture located at the Irish Property or
elsewhere and used or intended for use exclusively in the Irish
Business including assets which are capable of being moved if
unbolted from the Irish Property, but not including any such assets
which are Excluded Irish Assets;
"IRISH PRODUCTS" means the table sauce, dressings, pickle and
vinegar products marketed and sold under the "Chef" brand, the
preserves products marketed and sold under the "Fruitfield" brand,
the confectionery, preserves and table sauce products marketed and
sold under the "Old Time Irish" brand and the confectionery
products marketed and sold under the "Silvermints", "Double
Centre", "Scots Clan", "Yorkshire Toffee" and "Or Toffee" brands;
"IRISH PROPERTY" means the freehold property situated at Tallaght,
County Dublin, further details of which are set out in part 1 of
schedule 5;
"IRISH RECEIVABLES" means the aggregate amount of all book, trade
and other debts or sums due (including suppliers' credit notes),
owing, accrued or payable to Nestle Ireland in respect of the Irish
Business (whether or not then invoiced and whether or not then due
and payable) which relate to the period up to Irish Completion
(including, without limitation, in respect of goods and services
supplied by the Irish Business up to Irish Completion);
"IRISH REGULATIONS" means the European Communities (Safeguarding of
Employees' Rights on Transfers of Undertakings) Regulations 1980
and 2000;
"IRISH SCHEME" means the Nestle (Ireland) Pension Fund;
"IRISH SHARED CONTRACTS" means those contracts, agreements and
arrangements entered into by Nestle Ireland or any other member of
the Sellers' Group which are wholly or partly unperformed at the
Irish Completion Date and which relate in part to the Irish
Business and in part to other businesses of the Sellers' Group
(other than solely the UK Business);
"IRISH STOCK" means the stock in trade, raw materials, fuels,
packaging materials, engineering spares and work in progress, in
each case, located at suppliers of the Irish Business in Ireland or
at the Irish Property or in transit and finished goods acquired or
produced in the course of and which relate exclusively to the Irish
Business as at Irish Completion, including the Snack 5 Stock;
"IRISH VEHICLES" means the motor vehicles listed in part 2 of
schedule 11; and
"KNOW-HOW" means trade secrets and confidential business
information (including, without limitation, details of supply
arrangements), customer lists and pricing policy, sales targets,
sales statistics, market share statistics, marketing surveys and
10
reports, marketing research, advertising literature, unpatented
technical and other information (including inventions, discoveries,
production methods and techniques, recipes, processes and
procedures, ideas, concepts, formulae, specifications, procedures
for experiments and tests and results of experimentation in testing
and information comprised in computer software) together with all
common law and statutory rights protecting any such thing,
including any action for breach of confidence and any similar or
analogous rights to any of the above, whether arising or granted
under the laws of England or Ireland or any other jurisdiction;
"LONDON STOCK EXCHANGE" means London Stock Exchange plc;
"MERGERS ACT" means the Irish Mergers, Take-overs and Monopolies
(Control) Act 1978 (as amended);
"PARTIES" means the parties to this Agreement (and "RELEVANT
PARTIES" means the Relevant Buyer and the Relevant Seller, as the
context may require);
"PRODUCTS" means the UK Products and the Irish Products;
"PROPERTIES" means the UK Properties and the Irish Property, and
all of them and any of them as the context admits or any part or
parts thereof (and "RELEVANT PROPERTY" means the UK Properties or
the Irish Property as the context may require);
"RECEIVABLES" means the UK Receivables and the Irish Receivables;
"REGULATIONS" means the UK Regulations or the Irish Regulations (as
the context may require);
"RELEVANT EXCLUDED ASSETS" means the Excluded UK Assets or the
Excluded Irish Assets (as the context may require);
"ROWNTREE'S EQUIPMENT" means the plant and machinery located at
Nestle's production facility in Aylesbury and currently used
exclusively in the manufacture of Rowntree's dehydrated desserts;
"REGULATORY REQUIREMENTS" means any applicable requirement of law
or of any person who has regulatory authority in relation to the
relevant matter or person;
"SELLERS" means Nestle UK and Nestle Ireland, and each of them and
either of them as the context admits (and "RELEVANT SELLER" means
Nestle UK or Nestle Ireland, as the context may require);
"SELLERS' CODES" means the Global Trade Item Number and SSCC number
relating to each Product;
"SELLERS' GROUP" means the Sellers and any Affiliate of the Sellers
for the time being, and all of them and any of them as the context
admits;
11
"SELLERS' IRISH SOLICITORS" means A & L Goodbody;
"SELLERS' PENSION SCHEMES" means the UK Scheme and the Irish Scheme
(and each of them and either of them as the context may require)
(and "RELEVANT SELLER'S PENSION SCHEME" shall be construed
accordingly);
"SELLERS' UK SOLICITORS" means CMS Cameron McKenna;
"SENIOR EMPLOYEES" means any of the Assumed UK Employees who are
entitled to salary in excess of (pound)50,000 per annum and any of
the Assumed Irish Employees who are entitled to salary in excess of
(euro)80,000 per annum;
"SNACK 5 BUSINESS" means the business carried on by Nestle Ireland
comprising the import, marketing and sale of the Snack 5 Products;
"SNACK 5 PRODUCTS" means the dehydrated instant snack products
marketed and sold under the "Snack 5" brand;
"SNACK 5 STOCK" means the finished goods that relate exclusively to
the Snack 5 Business (wherever located) as at Irish Completion;
"SNACK STOP BUSINESS" means the business carried on by Nestle UK
comprising the production, marketing and sale of the Snack Stop
Products;
"SNACK STOP EQUIPMENT" means the plant and machinery located at
Nestle's production facility in Aylesbury and currently used
exclusively in the manufacture of the Snack Stop Products;
"SNACK STOP PRODUCTS" means the dehydrated instant snack products
marketed and sold under the "Snack Stop" brand;
"SNACK STOP STOCK" means the stock in trade, raw materials,
packaging materials, engineering spares (intended for use in
connection with the Snack Stop Equipment) and work in progress, in
each case, located at suppliers of the Snack Stop Business or
located at or formerly located at Nestle's production facility in
Aylesbury and finished goods acquired or produced in the course of
and which relate exclusively to the Snack Stop Business as at UK
Completion;
"SOFTWARE" means any and all computer programs in both source and
object code form, including all modules, routines and sub-routines
such programs and all source and other preparatory materials
relating to them, including user requirements, functional
specifications and programming specifications, ideas, principles,
programming languages, algorithms, flow charts, logic, logic
diagrams, orthographic representations, file structures, coding
sheets, coding and any manuals or other documentation relating to
them and computer generated works;
"STOCK" means the UK Stock and the Irish Stock (and "RELEVANT
STOCK" means the UK Stock or the Irish Stock, as the context may
require);
12
"STOCK VALUATION POLICY" means the policies for valuing Stock as
set out in schedule 12;
"TAXATION" or "TAX" means:
(a) all forms of taxation and statutory, governmental,
state, federal, provincial, local government or
municipal charges, duties, imposts, contributions,
levies, withholdings or liabilities wherever
chargeable and whether of the UK or Ireland or any
other jurisdiction; and
(b) any penalty, fine, surcharge, interest, charges or
costs payable in connection with any taxation within
(a) above;
"TAXATION AUTHORITY" means the Inland Revenue, Customs, the
Department of Social Security, the Irish Revenue Commissioners and
any other governmental, local, federal, state or other authority
whatsoever competent to impose any Taxation, whether in the United
Kingdom or Ireland or elsewhere;
"TCGA" means the Taxation of Chargeable Gains Act 1992;
"TERRITORY" means, in relation to the UK Business, the United
Kingdom, and in relation to the Irish Business, Ireland;
"THIRD PARTY INSURANCE POLICIES" means the insurance policies
described in Schedule 8;
"UK ASSETS" means the UK Business Claims, UK Goodwill, UK Books and
Records, UK Contracts, UK Fixed Plant, UK Loose Plant, UK Local
Intellectual Property, UK Local Know-How, UK Vehicles, UK IT, UK
Stock, Rowntrees Equipment, Snack Stop Equipment and Snack Stop
Stock and all other property, rights and assets (other than the
Excluded UK Assets) owned by Nestle UK and used, enjoyed or
exercised exclusively in the UK Business on UK Completion;
"UK BOOKS AND RECORDS" means the lists of customers and suppliers
of the UK Business, and all other records exclusively relating to
the UK Business;
"UK BUSINESS" means the business carried on by Nestle UK comprising
(a) the production of those of the UK Products manufactured at the
UK Properties; (b) the right for the Relevant Buyer to produce
those of the UK Products as are manufactured at location(s) other
than the UK Properties; (c) the production of private label,
industrial ingredients and other products manufactured at the UK
Properties; and (d) the sales and marketing and other ancillary
functions of Nestle UK carried on from Nestle UK's offices in
Croydon relating to the UK Products and the private label,
industrial ingredients and other products manufactured at the UK
Properties together with the Snack Stop Business;
"UK BUSINESS CLAIMS" means the benefit of all rights, entitlements
or claims to which Nestle UK is entitled (other than claims arising
under any policy of insurance) arising directly out of or in
connection with the operation by Nestle UK of the UK Business prior
13
to UK Completion, but only to the extent that such rights,
entitlements and claims are freely assignable by Nestle UK without
the consent of a third party;
"UK BUSINESS INTELLECTUAL PROPERTY" means all Intellectual Property
owned or used by Nestle UK or any other member of the Sellers'
Group other than the UK Local Intellectual Property and the UK
Local Know-How;
"UK CASH CONSIDERATION" means the sum of(pound)102,000,000
(exclusive of VAT);
"UK COMPLETION" means completion of the sale and purchase of the UK
Business, UK Assets and UK Properties in accordance with the terms
set out in this Agreement;
"UK COMPLETION DATE" means the date on which UK Completion takes
place (or is scheduled to take place) pursuant to clause 4.1, or
such other date as the Relevant Parties shall agree;
"UK COMPLETION STATEMENT" means the statement of apportionments
required to be prepared in relation to the UK Business pursuant to
clause 11;
"UK CONTRACTS" means all contracts, agreements and arrangements
entered into by Nestle UK or any other member of the Sellers' Group
which are wholly or partly unperformed at the UK Completion Date
and which relate exclusively to the UK Business, but excluding:
(a) contracts of employment with the Assumed UK Employees;
and
(b) any contracts which are Excluded UK Assets;
"UK CREDITORS" means the aggregate amount of all book, trade and
other debts (including, without limitation, financial debt) and
sums due (including credit notes granted and sums payable in
respect of any breach by Nestle UK of any Material Contract prior
to UK Completion), owing, accrued or payable by Nestle UK in
respect of the UK Business (whether or not invoiced and whether or
not then due and payable) which relate to, or have been incurred
in, the period up to UK Completion (including, without limitation,
in respect of goods and services provided to the UK Business up to
UK Completion);
"UK FIXED PLANT" means the fixed plant, machinery and equipment
used or intended for use exclusively in the UK Business attached or
fixed to the UK Properties;
"UK GOODWILL" means the exclusive right for the Buyer to represent
itself as carrying on the UK Business in succession to Nestle UK;
"UK IT" means the Hardware listed in part 1 of schedule 13;
14
"UK LISTING AUTHORITY" means the Financial Services Authority in
its capacity as the competent authority for the purposes of Part VI
of the Financial Services and Markets Act 2000;
"UK LOCAL INTELLECTUAL PROPERTY" means that Intellectual Property
owned by Nestle UK and used exclusively in the UK Business;
"UK LOCAL INTELLECTUAL PROPERTY ASSIGNMENT" means the deed under
which the UK Local Intellectual Property is to be assigned by
Nestle UK to the UK Buyer;
"UK LOCAL KNOW-HOW" means any Know-How used exclusively in the UK
Business including shop practices, instructions and training
manuals, market forecasts, quotations and marketing methods and
procedures;
"UK LOOSE PLANT" means the movable plant, machinery, equipment,
spare parts, tooling and furniture located at the UK Properties and
used or intended for use exclusively in the UK Business including
any assets which are capable of being moved if unbolted from the UK
Properties, but not including any such assets which are Excluded UK
Assets;
"UK PRODUCTS" means the pickle products marketed and sold under the
"Crosse & Blackwell" (including sub brands such as Branston,
Sarson's and Waistline) and "Pan Yan" brands, the table sauce,
vinegar and dressings products marketed and sold under the "Crosse
& Blackwell" and "Dufrais" brands, the spreads products marketed
and sold under the "Gale's" and "Sun-Pat" brands, the ambient
dessert products marketed and sold under the "Rowntree's" brand and
the dehydrated food products marketed and sold under the "Crosse &
Blackwell" and "Creamola" brands, but not including the Snack Stop
Products;
"UK PROPERTIES" means the freehold properties located at Hadfield,
Derbyshire and Middleton, Greater Manchester, further details of
which are set out in part 1 of schedule 4;
"UK RECEIVABLES" means the aggregate amount of all book, trade and
other debts or sums due (including suppliers' credit notes), owing,
accrued or payable to Nestle UK in respect of the UK Business
(whether or not then invoiced and whether or not then due and
payable) which relate to the period up to UK Completion (including,
without limitation, in respect of goods and services supplied by
the UK Business up to UK Completion);
"UK REGULATIONS" means the Transfer of Undertakings (Protection of
Employment) Regulations 1981;
"UK SCHEME" means the Nestle UK Pension Fund;
"UK SHARED CONTRACTS" means those contracts, agreements and
arrangements entered into by Nestle UK or any other member of the
Sellers' Group which are wholly or partly unperformed at the UK
Completion Date and which relate in part to the UK Business and in
15
part to other businesses of the Sellers' Group (other than solely
the Irish Business);
"UK STOCK" means the stock in trade, raw materials, fuels,
packaging materials, engineering spares and work in progress, in
each case, located at suppliers of the UK Business or at the UK
Properties or in transit and finished goods acquired or produced in
the course of and which relate exclusively to the UK Business as at
UK Completion, but not including any raw honey produced in China
and any finished honey products which contain raw honey produced in
China;
"UK VEHICLES" means the motor vehicles listed in part 1 of schedule
11; and
"VAT" means value added tax (in the UK and/or Ireland) or any
similar tax which may be substituted for it or levied in addition
to it;
"VATA" means the Value Added Tax Act 1994;
"VAT ELEMENT" means the amount of consideration for any supply of
goods or services which is attributable to VAT chargeable on that
supply;
"WARRANTIES" means the warranty given pursuant to clause 16.1 and
each of the warranty statements set out in schedule 3, and each
warranty statement shall be a "WARRANTY" (and "WARRANTY STATEMENT"
shall be construed accordingly).
1.2 In this Agreement:
1.2.1 the table of contents and headings are for convenience
only and shall not form part of the operative
provisions, or affect the construction of this
Agreement;
1.2.2 references to the Parties include their respective
permitted assignees and, in the case of individuals
their respective successors in title, personal
representatives, heirs and estates and references to
the masculine gender shall include the feminine and
vice versa;
1.2.3 references to any statute, statutory provision,
directive of the Council of the European Union
(whether issued jointly with any other person or under
any other name) or other legislation include a
reference to that statute, statutory provision,
directive or legislation as amended, extended,
consolidated or replaced from time to time (whether
before or after the date of this Agreement) and
include any order, regulation, instrument or other
subordinate legislation made under the relevant
statute, statutory provision, directive or
legislation;
1.2.4 references to persons shall include bodies corporate
and unincorporated, associations, partnerships and
individuals;
1.2.5 references to recitals, clauses or schedules are to
recitals to, clauses of and schedules to this
Agreement;
16
1.2.6 the recitals, the schedules and the documents in the
Agreed Form part of the operative provisions of this
Agreement and references to this Agreement shall,
unless otherwise expressly stated, include references
to the recitals, the schedules and the documents in
the Agreed Form; and
1.2.7 the expressions "HOLDING COMPANY", "SUBSIDIARY" and
"SUBSIDIARY UNDERTAKING" bear the same meanings as
they respectively bear in the Companies Act.
2. SALE AND PURCHASE
UK BUSINESS
2.1 Nestle UK, as beneficial owner, shall sell (or procure to be sold)
to the UK Buyer with full title guarantee and the UK Buyer shall
purchase the UK Assets and the UK Business with effect from UK
Completion free from any Encumbrances.
2.2 Clause 2.1 shall (subject to the provisions contained in clause 12)
operate as an assignment of the benefit (subject to the burden) of
each of the UK Contracts with effect from UK Completion.
2.3 The Excluded UK Assets and the Excluded UK Liabilities are not
included in the sale and purchase pursuant to clause 2.1.
2.4 Nestle UK shall sell to the UK Buyer the UK Properties subject to
the conditions set out in schedule 4.
IRISH BUSINESS
2.5 Nestle Ireland, as beneficial owner, shall sell (or procure to be
sold) to the Irish Buyer and the Irish Buyer shall purchase the
Irish Assets (other than the Irish Fixed Plant which shall be sold
in accordance with clause 2.8) and the Irish Business with effect
from Irish Completion free from any Encumbrances.
2.6 Clause 2.5 shall (subject to the provisions contained in clause 12)
operate as an assignment of the benefit (subject to the burden) of
each of the Irish Contracts with effect from Irish Completion.
2.7 The Excluded Irish Assets and the Excluded Irish Liabilities are
not included in the sale and purchase pursuant to clause 2.5.
2.8 Nestle Ireland shall sell to the Irish Buyer the Irish Property and
the Irish Fixed Plant subject to the conditions set out in schedule
5.
3. CONSIDERATION
3.1 The aggregate consideration for the sale of the UK Assets and UK
Properties shall be:
17
3.1.1 the payment by the UK Buyer to Nestle UK of the UK
Cash Consideration, such sum to be paid in cash on UK
Completion in accordance with clause 4.2.4;
3.1.2 the assumption by the UK Buyer of the Assumed UK
Liabilities; and
3.1.3 the payment by the UK Buyer to Nestle UK of the sum of
(pound)13,000,000 (which shall be retained by Nestle
UK in the event that the sale of the Irish Business
under this Agreement is not completed (in which case
it shall be treated as additional consideration for
the UK Goodwill);
3.2 The aggregate consideration for sale of the Irish Assets and Irish
Property shall be:
3.2.1 the payment by the Irish Buyer to Nestle Ireland of
the Irish Cash Consideration, such sum to be paid in
cash on Irish Completion in accordance with clause
4.6.5; and
3.2.2 the assumption by the Irish Buyer of the Assumed Irish
Liabilities.
3.3 The amounts payable for each of the Assets and Properties shall be
the amount apportioned thereto as set out in schedule 2, and such
amounts shall be adopted by the Relevant Seller and the Relevant
Buyer for all purposes including Tax and stamp duty.
3.4 Any amount payable by the Relevant Seller to the Relevant Buyer or
by the Relevant Buyer to the Relevant Seller (as the case may be)
pursuant to clause 10.8, 10.9 or 11.9 shall, so far as possible and
reasonable, adjust the sum attributed to the particular Relevant
Asset in respect of which such payment is required to be made or,
if no such adjustment is possible or reasonable, shall adjust the
sum attributed to UK Goodwill or, in the case of an adjustment paid
to or by the Irish Seller, the sum attributed to such other
Relevant Assets as shall be reasonable (as the context may require)
accordingly.
4. COMPLETION
4.1 UK Completion shall take place at the offices of the Sellers' UK
Solicitors at 10am on 27 May 2002.
4.2 On UK Completion:
4.2.1 Nestle UK shall deliver (or otherwise make available)
to the Buyer at the UK Properties, all certificates,
records and other papers in its possession or control
relating to the UK Local Intellectual Property and UK
Local Know-How (if any), those of the UK Books and
Records located at the UK Properties, the UK Loose
Plant and all other UK Assets which are capable of
transfer by delivery with the intent that title in
such UK Assets shall pass by and upon such delivery,
18
and shall permit the UK Buyer to enter into and take
possession of such UK Assets;
4.2.2 Nestle UK will deliver to the UK Buyer the title deeds
and documents relating to the UK Properties;
4.2.3 Nestle UK will execute (or, where relevant, procure
the execution of) and deliver to the UK Buyer, and the
UK Buyer will execute (or, where relevant, procure the
execution of) and deliver to Nestle UK:
(a) the UK Local Intellectual Property
Assignment;
(b) the Domain Name Transfers; and
(c) transfers of the UK Properties in the
Agreed Form;
4.2.4 the UK Buyer shall pay:
(a) the UK Cash Consideration; and
(b) the sum of(pound)13,000,000 (which shall
be repaid only on Irish Completion);
by the electronic transfer of funds to the bank
account of the Sellers' UK Solicitors at Lloyds TSB
Bank plc, 39 Threadneedle Street, London EC2R 8AU,
account number 0230949, sort code 30-00-09 and the
receipt of the Sellers' UK Solicitors therefor shall
be a good discharge to the UK Buyer.
4.3 If the Buyer or Nestle UK (the "DEFAULTING PARTY") fails in any
material respect to comply with its completion obligations set out
in clause 4.2 on the date specified for UK Completion in clause
4.1, the other Party (the "NON-DEFAULTING Party") will not be
obliged to complete the sale and purchase of the UK Business, UK
Assets and UK Properties in accordance with this Agreement and may
immediately by written notice:
4.3.1 defer the date set for UK Completion to a date not
more than 28 days after the date set out in clause
4.1;
4.3.2 without prejudice to its rights under this Agreement,
proceed so far as practicable with the transactions
contemplated by this Agreement in relation to the sale
and purchase of the UK Business, UK Assets and UK
Properties;
4.3.3 terminate those provisions of this Agreement that
relate solely to the sale and purchase of the UK
Business, UK Assets and UK Properties, but without
prejudice to any rights of the Non-Defaulting Party
against the Defaulting Party in respect of any
antecedent breach of this Agreement; or
19
4.3.4 waive all or any of the Defaulting Party's completion
obligations at its discretion.
4.4 Irish Completion shall be conditional upon (i) the Charge having
been formally released (ii) the UK Buyer not having exercised any
right to terminate (to the extent the same exists) pursuant to
clause 4.3.3 and (iii) the Minister for Enterprise, Trade and
Employment having stated in writing to the Irish Buyer and Nestle
Ireland that she does not intend to make an order under section 9
of the Mergers Act in relation to the proposed acquisition of the
Irish Assets and the continuation of the Irish Business by the
Irish Buyer; or, in the event of the said Minister making an order
subject to conditions, the Relevant Parties accepting such
conditions and for this purpose the Relevant Parties undertake to
co-operate with each other in good faith and accept any and all
reasonable conditions and the Irish Buyer further undertakes to
accept and give such undertakings relating to its business, the
Irish Business and any operations in Ireland as the said Minister
shall require of it; or, in the event of no such order being made
and the said Minister not stating in writing that she does not
intend to make such an order, the "relevant period" within the
meaning of section 6 of the Mergers Act, having elapsed PROVIDED
THAT if the condition set out in (i) above has not been fulfilled
in circumstances where the conditions set out in (ii) and (iii)
above have been fulfilled, the Irish Buyer may elect (within 5
Business Days thereafter) either:
4.4.1 to waive the condition set out in (i) above and
proceed to Irish Completion, in which event Nestle UK
shall indemnify and keep indemnified and hold harmless
the Buyers' Group against any costs, claims, damages,
expenses and other losses that they may incur as a
result of the failure to procure the formal release of
the Charge by Nestle Ireland prior to Irish
Completion; or
4.4.2 not to complete the purchase of the Irish Business,
Irish Assets and Irish Property, in which event the UK
Buyer shall, for the avoidance of doubt, be entitled
to retain the payment of (pound)13,000,000 made
pursuant to clause 4.2.4.
4.5 The Relevant Parties shall each use their reasonable endeavours
(and shall co-operate with each other) so as to procure that the
conditions specified in clause 4.4 are satisfied on or before the
date falling six months after the date of this Agreement or the
relevant date specified by the Minister (whichever is the later).
If such conditions are not so satisfied, those provisions of this
Agreement that relate solely to the sale and purchase of the Irish
Business shall terminate and have no further effect and the Irish
Buyer and Nestle Ireland shall be released and discharged from
their respective obligations under those provisions of this
Agreement but without prejudice to any rights of the Irish Buyer or
Nestle Ireland against the other in respect of any antecedent
breach of this Agreement.
4.6 Irish Completion shall take place at the offices of the Sellers'
Irish Solicitors on the fifth Business Day following satisfaction
of the conditions set out in clause 4.4 at which time:
20
4.6.1 Nestle Ireland shall deliver (or otherwise make
available) to the Irish Buyer at the Irish Property,
all certificates, records and other papers in its
possession or control relating to the Irish Local
Intellectual Property and the Irish Know-How (if any),
the Irish Books and Records, the Irish Loose Plant and
all other Irish Assets which are capable of transfer
by delivery with the intent that title in such Irish
Assets shall pass by and upon such delivery, and shall
permit the Irish Buyer to enter into and take
possession of such Irish Assets and prior to Irish
Completion, Nestle Ireland shall ensure that all bolts
and fastenings attaching plant, machinery or fittings
to land or buildings (insofar as included in the sale
hereunder) shall be undone so that the same shall be
severed at Irish Completion and the title thereto
shall pass by delivery;
4.6.2 Nestle Ireland will execute (or, where relevant,
procure the execution of) and deliver to the Irish
Buyer, and the Irish Buyer will execute (or, where
relevant, procure the execution of) and deliver to
Nestle Ireland:
(a) the Irish Local Intellectual Property
Assignment; and
(b) a transfer of the Irish Property (in the
Agreed Form);
4.6.3 Nestle Ireland will produce to the Irish Buyer a
capital gains tax certificate issued under section
980(8) Taxes Consolidation Act 1997 confirming that
Tax should not be deducted from that part of the Irish
Cash Consideration that is attributable to the Irish
Property and Irish Goodwill;
4.6.4 Nestle Ireland shall deliver to the Irish Buyer:
(a) the documents listed in Special Condition
15 in part 2 of schedule 5; and
(b) the deeds and documents relating to the
Irish Property;
4.6.5 subject to Nestle UK having repaid the sum referred to
in clause 4.2.4, the Irish Buyer shall pay the Irish
Cash Consideration to Nestle Ireland by the electronic
transfer of funds to the bank account of the Sellers'
Irish Solicitors at Bank of Ireland (International
Banking), Head Office, Lower Baggot Street, Dublin 2,
account number 30892089, swift code BOFI 1E2D and the
receipt of the Sellers' Irish Solicitors therefor
shall be a good discharge to the Irish Buyer.
4.7 If, following satisfaction of the conditions set out in clause 4.4,
the Irish Buyer or Nestle Ireland (the "DEFAULTING PARTY") fails in
any material respect to comply with its completion obligations set
out in clause 4.6 on the date specified for Irish Completion in
clause 4.6, the other Party (the "NON-DEFAULTING PARTY") will not
be obliged to complete the sale and purchase of the Irish Business,
Irish Assets and Irish Property in accordance with this Agreement
and may immediately by written notice:
21
4.7.1 defer the date set for Irish Completion to a date not
more than 28 days after the date set out in clause
4.6;
4.7.2 without prejudice to its rights under this Agreement,
proceed so far as practicable with the transactions
contemplated by this Agreement in relation to the sale
and purchase of the Irish Business, Irish Assets and
Irish Property;
4.7.3 terminate those provisions of this Agreement that
relate solely to the sale and purchase of the Irish
Business, Irish Assets and Irish Property, but without
prejudice to any rights of the Non-Defaulting Party
against the Defaulting Party in respect of any
antecedent breach of this Agreement; or
4.7.4 waive all or any of the Defaulting Party's completion
obligations at its discretion.
4.8 The UK Buyer's obligation to pay the Irish Cash Consideration
pursuant to clause 4.6.5 may be set off against Nestle UK's
obligation to repay the sum referred to in clause 4.2.4.
5. INTERIM PERIOD
5.1 Pending Completion, the Relevant Seller undertakes to the Relevant
Buyer that (unless otherwise agreed in writing by the Relevant
Buyer) it shall:
5.1.1 carry on the Relevant Business in the ordinary course
of trading in the manner in which the same has been
carried on prior to the date of this Agreement in
accordance with all applicable legal and
administrative requirements of a material nature;
5.1.2 not make any material change in the nature of the
Relevant Business;
5.1.3 not enter into any contract of a long-term or unusual
nature exceeding (pound)200,000 or (euro)100,000 in
value (as appropriate);
5.1.4 not enter into or vary in any material respect any
transaction in respect of the Relevant Business
otherwise than in the ordinary course of trading and
on arms' length terms;
5.1.5 save as disclosed by the Data Room Documents, not
(other than in consultation with the Relevant Buyer)
employ or dismiss any persons whose remuneration
exceeds (pound)150,000 (in aggregate) in the UK or
(euro)150,000 (in aggregate) in Ireland other than (in
relation to dismissal) any person whom the Relevant
Seller is entitled to dismiss summarily;
5.1.6 not dispose of or agree to dispose of any material
Relevant Asset or material Relevant Stock other than
in the ordinary course of business;
22
5.1.7 not create, extend, grant, issue or redeem or agree to
create, grant or issue any Encumbrance over the
Relevant Business or the Relevant Assets (other than
liens arising in the ordinary course of business);
5.1.8 not agree to make capital expenditure or commitments
requiring capital expenditure in excess of
(pound)50,000 in the UK or (euro)25,000 in Ireland in
respect of any individual contract, or (pound)200,000
in the UK or (euro)100,000 in Ireland in aggregate;
5.1.9 save in the ordinary course of business, not agree to
give an indemnity, guarantee or other agreement to
secure a third party's obligation;
5.1.10 not pay or delay payment to its creditors other than
in the ordinary course of business, nor change its
policies in relation to the payment of creditors;
5.1.11 not commence, compromise, settle or waive any material
right in relation to ongoing litigation or arbitration
proceedings;
5.1.12 not do anything likely to affect the Relevant Seller's
rights in respect of the UK Local Intellectual
Property or Irish Local Intellectual Property (as the
case may be);
5.1.13 not alter or agree to alter any terms of employment or
benefits affecting all of its employees or alter any
material working practices of the Relevant Business or
collective agreement relating to such material working
practices; and
5.1.14 not amend or discontinue (wholly or partly) the
Relevant Seller's Pension Scheme or communicate to any
of the members of the Relevant Seller's Pension Scheme
a plan, proposal or intention to amend or discontinue
(wholly or partly) that scheme (unless and to the
extent that such amendment is required by law);
5.1.15 at the reasonable request of the Relevant Buyer,
provide the Relevant Buyer reasonably promptly with
information concerning the business, assets and
ongoing affairs of the Relevant Business;
5.1.16 on reasonable notice, allow the Relevant Buyer and its
officers and representatives reasonable access to the
Relevant Property at pre-arranged times convenient to
both the Relevant Seller and the Relevant Buyer and
allow the Relevant Buyer and its officers and
representatives reasonable access to Senior Employees
at all times having regard to such persons' ongoing
duties as employees of the Relevant Seller;
5.1.17 continue (consistent with past practice) to maintain
the Third Party Insurance Policies and not knowingly
do anything which would cause any such insurance
policies to become void; and
23
5.1.18 save in the ordinary course of business, not to do
anything to affect the value or existing use or
covenants or consents of or pertaining to the Relevant
Properties.
5.2 The UK Buyer shall have the right to elect by notice in writing to
Nestle UK not to complete the acquisition of the UK Business, UK
Assets and UK Properties in the event of there having occurred in
the period pending UK Completion any destruction or damage to the
UK Properties and/or UK Assets which results in a Material Effect
on the UK Business taken as a whole. A "Material Effect" for the
purposes of this clause 5.2, means that the events described above
are of such considerable significance as to have caused a
fundamental adverse change to the UK Business which is of a long
term nature and which fundamentally affects the value of the
Business.
5.3 During the period from the date of this Agreement until such time
as the Irish Buyer exercises its right not to acquire the Irish
Business, Irish Assets and Irish Property pursuant to clause 4.4.2
(to the extent that such right exists), Nestle Ireland shall use
its best endeavours to procure the formal release of the Charge.
6. CREDITORS AND RECEIVABLES
6.1 The Sellers shall collect the Receivables for their own account and
the Buyers shall give reasonable assistance to the Sellers to
enable the Sellers to collect the Receivables. The Relevant Parties
shall co-operate to ensure that in all respects, including the
application of payments in dealing with defaulting debtors, debtors
are treated in a manner which is consistent with the Relevant
Seller's previous practice.
6.2 Any sums received by the Relevant Buyer representing any of the
Receivables shall be held on trust by the Relevant Buyer for the
Relevant Seller and shall be paid to the Relevant Seller as soon as
reasonably practicable after they are received by the Relevant
Buyer. If a payment is received by the Relevant Buyer from a person
who owes any of the Receivables and who is also a debtor of the
Relevant Buyer, such payment shall be applied (save in the case of
any direction of that person to the contrary) in discharge of the
earliest undischarged debt due from that person to the Relevant
Seller or the Relevant Buyer (as the case may be).
6.3 If the Sellers receive any sums following the Completion Date which
represent payment by a third party for goods or services supplied
by the Relevant Business following the Completion Date, the
Relevant Seller shall hold such sums on trust for the Relevant
Buyer and shall account to the Relevant Buyer for such sums as soon
as reasonably practicable after they are received by it.
6.4 The Sellers shall discharge the Creditors and shall indemnify the
Buyers against all costs, claims, demands, proceedings, expenses
and liabilities in respect of them.
6.5 The Buyers shall discharge all post-completion creditors (as
hereinafter defined) and shall indemnify the Sellers against all
costs, claims, demands, proceedings, expenses and liabilities in
24
respect of them. In this clause 6.5, "POST-COMPLETION CREDITORS"
means the aggregate amount of all book, trade and other debts
(including, without limitation, financial debt) and sums (including
credit notes granted) in respect of the UK Business which arise in
the period following UK Completion, and in respect of the Irish
Business which arise in the period following Irish Completion.
7. SELLERS' POST COMPLETION OBLIGATIONS
7.1 Subject to the provisions contained in the Services Agreements, the
benefit of all contracts and orders relating to the UK Business
which are placed with Nestle UK on or after UK Completion, and the
benefit of all contracts and orders relating to the Irish Business
which are placed with Nestle Ireland on or after the Irish
Completion, and all payments relating to such contracts and orders
which are received by the Sellers (which shall be dealt with in
accordance with clause 6.3), shall belong to and be for the benefit
of the Relevant Buyer and the Relevant Seller shall as soon as
reasonably practicable send to the Relevant Buyer all notices,
correspondence, information, orders or enquiries relating to the
Relevant Business or the Relevant Assets which are received by it
on or after Completion.
7.2 During the six years following the Completion Date, the Relevant
Seller will, as soon as reasonably practicable following request,
provide the Relevant Buyer with all information in tangible form
known to it (or which would on reasonable enquiry be known to it)
in relation to the Relevant Seller's operation of the Relevant
Business prior to the Completion Date which after the Completion
Date remains in the Relevant Seller's (but not the Relevant
Buyer's) possession or control if it is required by the Relevant
Buyer for the purposes of complying with Regulatory Requirements.
7.3 As soon as reasonably practicable after UK Completion and in any
event by no later than 30 September 2002, Nestle UK shall procure
that:
7.3.1 those of the UK Books and Records that are located at
its offices in Croydon are delivered to the UK Buyer
and pending such delivery Nestle UK shall make all
such books and records available for inspection by the
UK Buyer (or its representatives) at its offices in
Croydon at all reasonable times and on reasonable
prior notice; and
7.3.2 the Rowntree's Equipment, Snack Stop Equipment and
Snack Stop Stock is (in each case) delivered to the
property referred to in part 1 of schedule 4, and (as
applicable) commissioned and made available for use.
7.4 Nestle Ireland shall procure that the Irish Buyer shall be entitled
to use the Endorser Brands on "Double Centre", "Yorkshire Toffee",
"Scots Clan" and "Or Toffee" products for a period of six months
following the Irish Completion Date.
7.5 On or as soon as reasonably practicable after the date of this
Agreement, the Relevant Parties shall send out a joint notice in
the Agreed Form to all of the suppliers and customers of the
25
Relevant Business notifying them of the proposed transfer of the
Relevant Business to the Buyer.
7.6 The Relevant Seller undertakes to provide the Relevant Buyer with
all reasonable assistance and information to enable the Relevant
Buyer to calculate its entitlement to capital allowances on the
buildings located at the UK Properties and the Irish Property (as
the case may be).
7.7 To the extent that any Insurance Claim arises, the Sellers will (at
the Relevant Buyer's request), subject to being indemnified by the
Buyers against any expense, cost or liability which they may
thereby incur (including, without limitation, any excess or
deductible payable under the relevant policy of insurance), use
their reasonable endeavours, consistent with past practice, to
enforce such Insurance Claim and pay to the Relevant Buyer any
proceeds thereof, net of any excess and costs (including Tax)
incurred by the Relevant Seller.
8. BUYERS' POST COMPLETION OBLIGATIONS
8.1 During the six years following the Completion Date, the Relevant
Buyer will, as soon as reasonably practicable following request,
provide the Relevant Seller with all information in tangible form
known to it (or which would on reasonable enquiry be known to it)
in relation to the Relevant Business, if it is required by the
Relevant Seller for the purposes of complying with Regulatory
Requirements.
8.2 If any complaints are made after Completion by customers of the
Relevant Business in relation to goods delivered by the Relevant
Seller prior to Completion, the Relevant Buyer shall, as soon as
reasonably practicable after such complaints come to its notice,
furnish full particulars thereof in writing to the Relevant Seller
so as to enable it to investigate the same. If the Relevant Seller
shall require the Relevant Buyer to supply to the customer in
question any goods by way of replacement, the Relevant Buyer shall
(on the request in writing by the Relevant Seller) supply the same
to the customer and charge the Relevant Seller for such goods at
cost price.
8.3 Following Completion, where physically located at the Properties,
the Relevant Buyer will hold the Excluded UK Assets and the
Excluded Irish Assets on trust for the Relevant Seller and shall
(subject to the terms of the Services Agreements) permit the
Relevant Seller to enter the Properties at reasonable pre-arranged
times to remove them. The Relevant Seller undertakes that if the
removal of any Relevant Excluded Assets causes damage to the
Relevant Property and/or the Relevant Assets, the Relevant Seller
will restore the damaged property to its prior condition.
8.4 Save as expressly set out in this Agreement, the Buyers acknowledge
and agree on behalf of themselves and each member of the Buyers'
Group that nothing in this Agreement shall operate as an agreement
to transfer (nor shall transfer) any right, title or interest in
any trade mark, house mark or company name to the extent it
contains or consists of the words "Mackintosh's" or "Nestle" or any
other mark in which any of those words or elements appears
26
(together the "SELLERS' MARKS"). The Buyers agree that they will
procure that as soon as reasonably practicable and, in any event,
within six months following the UK Completion Date, the Sellers'
Marks and the Sellers' Codes will be removed from all signage,
stocks, sales literature or other promotional or packing materials
or literature and all other assets whatsoever of the Buyers and the
Buyers agree that neither they nor any other member of the Buyers'
Group will use the Sellers' Marks or the Sellers' Codes or any
signage, stocks, sales literature or other promotional or packing
materials or literature bearing or containing a Sellers' Mark or a
Sellers' Code nor shall the Buyers or any other member of the
Buyers' Group hold themselves out as being part of or in any way
connected with the Sellers' Group. The Buyers will as soon as
practicable and in any event within six months following the UK
Completion Date obtain new Sellers' Codes for each of the Products.
9. ASSUMED LIABILITIES AND EXCLUDED LIABILITIES
9.1 The Buyers undertake with the Sellers (for themselves and as
trustee for each member of the Sellers' Group) that they will duly
and properly perform, assume and pay and discharge when due, and
indemnify the Sellers (and each member of the Sellers' Group)
against, all Assumed Liabilities.
9.2 Subject to the provisions of the Services Agreements insofar as the
procedures for payment, satisfaction and discharge are concerned,
the Sellers hereby agree with the Buyers (for themselves and as
trustee for each member of the Buyers' Group) that they will pay
and discharge when due, and indemnify the Buyers (and each member
of the Buyers' Group) against, all Excluded Liabilities.
9.3 If any action, claim or demand is brought or alleged against the
Buyers or, as the case may be, the Sellers (the "INDEMNIFIED
PARTY") in respect of which an indemnity is to be sought from the
Sellers or, as the case may be, the Buyers (the "INDEMNIFYING
PARTY") pursuant to this clause 9, the Indemnified Party shall as
soon as reasonably practicable notify the Indemnifying Party of
such action, claim or demand and the Indemnifying Party shall have
the option to assume the defence thereof. If the Indemnifying Party
fails to assume such defence, it shall be liable to the Indemnified
Party for any reasonable legal or other expenses subsequently
incurred by the Indemnified Party in connection with such defence
and the Indemnified Party shall be entitled to conduct such defence
in such a manner as it shall, in its absolute discretion, deem
appropriate. Where the Indemnifying Party assumes such defence, it
shall not settle the action, claim or demand without the consent of
the Indemnified Party (such consent not to be unreasonably withheld
or delayed).
10. APPORTIONMENTS, PREPAYMENTS AND DISCOUNTS
10.1 All periodical charges and periodical outgoings of each Relevant
Business, including but not limited to, rents, rates, non-customer
rebates, gas, electricity, telephone and water charges and all
liabilities in relation to salaries (including PAYE), wages,
27
national insurance and pension contributions, accrued holiday pay
and holiday entitlements (but not any entitlement to redundancy
payments or any other obligation in respect of an Assumed
Employee's period of continuous service) shall be apportioned on a
time basis so that such part of the relevant charges attributable
to the period up to the Effective Time shall be borne by the
Relevant Seller and such part of the relevant charges attributable
to the period after the Effective Time shall be borne by the
Relevant Buyer. All rents, licence fees, royalties and other
periodical receipts of the Relevant Business shall be apportioned
between the Relevant Seller and the Relevant Buyer on a like basis.
All such costs and outgoings described in this clause 10.1, other
than those relating exclusively to the Irish Property which shall
be apportioned in the Apportionment Account pursuant to schedule 5,
shall be apportioned in the Completion Statement.
10.2 All prepayments and payments in advance excluding the amount of any
VAT Element thereof to the extent that the Relevant Seller or the
representative member of any VAT group of which the Relevant Seller
is a member is required to account to Customs for such VAT, made to
the Relevant Seller in the ordinary course of business prior to the
Completion Date in respect of goods which are to be supplied or
services which are to be provided by the Relevant Business after
the Completion Date, liability for which is to be assumed by the
Relevant Buyer under this Agreement, shall be apportioned in the
Completion Statement and shall be paid by the Relevant Seller to
the Relevant Buyer.
10.3 All prepayments and payments in advance excluding any VAT Element
thereof which is recovered by the Relevant Seller or the
representative member of any VAT group of which the Relevant Seller
is a member, made by the Relevant Seller in the ordinary course of
business prior to the Completion Date in respect of goods which are
to be supplied or services which are to be provided to the Relevant
Business after the Completion Date, the benefit of which the
Relevant Buyer shall receive under this Agreement, shall be
apportioned in the Completion Statement and shall be paid to the
Relevant Seller by the Relevant Buyer.
10.4 Notwithstanding any other provision of this Agreement, the Relevant
Seller shall remain responsible for paying customer discounts which
accrue in respect of sales made in the period up to the Completion
Date and the Relevant Buyer shall be responsible for paying
customer discounts which accrue in respect of sales made in the
period after the Completion Date on the basis set out in clauses
10.5 and 10.6.
10.5 In respect of any discounts (including, for this purpose, any
volume related payments) which apply in respect of sales or
purchases made both before and after Completion, the Relevant
Parties shall use all reasonable endeavours to agree with the
relevant third party an apportionment of such discounts up to the
Completion Date. Promptly, following the expiry of the period to
which they relate, the Relevant Parties shall calculate how much of
such discount is payable by the Relevant Seller and how much by the
Relevant Buyer. Such calculation shall be made according to the
discount structure by calculating the volume of the particular
28
sales or purchases made before the Completion Date and the volume
of the particular sales or purchases made after the Completion Date
and applying the ratio of these amounts to the total discount due.
The total discount due in respect of the total discount period
shall be calculated in line with the relevant contract conditions
existing on the Completion Date and shall be pro-rated between the
Relevant Buyer and the Relevant Seller according to the said ratio
notwithstanding that the discount is expressed on a differential
basis (e.g. even though a high discount may be payable once sales
or purchases pass a certain figure, the Relevant Parties shall
assume that the total discount due is evenly spread across the
total volume to which the discount relates). Any amount required to
be paid by the Relevant Seller or the Relevant Buyer (as the case
may be) under this clause 10.5 shall be paid directly to the
relevant third party at such time as such amount falls
contractually due. If the Relevant Parties are unable to agree on
the amount(s) required to be paid pursuant to this clause, the
matter(s) in dispute shall be referred to the decision of an
Independent Expert.
10.6 In the event that the Relevant Buyer wishes to modify an existing
discount scheme, it shall first bring to an end the existing scheme
and make the calculations under clause 10.5 in respect of the
period up to the date on which the scheme is ended.
10.7 On or prior to the Completion Date the Relevant Parties shall
attend at the Relevant Property and, in the case of UK Stock, also
at the finished goods stores at Bardon and Scunthorpe in the UK,
and, in the case of the Irish Stock, also at the finished goods
stores at Clondalkin and Mallow in Ireland, and shall procure that
the Relevant Stock shall be counted or checked (as appropriate) and
valued in accordance with the Stock Valuation Policy. The value
attributed to the Relevant Stock shall be reduced by any amount(s)
paid or payable to the Relevant Seller for the Relevant Stock prior
to Completion (not being amounts to be apportioned under clauses
10.1 to 10.3). Any dispute as to the valuation of the Relevant
Stock shall be referred to the decision of an Independent Expert.
10.8 If the value of the UK Stock as agreed or determined in accordance
with clause 10.7 is less than (pound)11,750,000, the consideration
payable for the UK Business and UK Assets shall be reduced by the
amount of that shortfall (on a (pound) for (pound) basis). If the
value of the UK Stock as agreed or determined in accordance with
clause 10.7 is greater than (pound)13,250,000, the consideration
payable for the UK Business and UK Assets shall be increased by the
amount of that excess (on a (pound) for (pound) basis).
10.9 If the value of the Irish Stock as agreed or determined in
accordance with clause 10.7 is less than (euro)3,650,000, the
consideration payable for the Irish Business and Irish Assets shall
be reduced by the amount of that shortfall (on a (euro) for (euro)
basis). If the value of the Irish Stock as agreed or determined in
accordance with clause 10.7 is greater than (euro)3,950,000, the
consideration payable for the Irish Business and Irish Assets shall
be increased by the amount of that excess (on a (euro) for (euro)
basis).
29
11. COMPLETION STATEMENT
11.1 As soon as practicable following Completion, the Relevant Seller
shall (in relation to the Relevant Business) prepare a draft
Completion Statement. The Relevant Buyer shall procure that the
Relevant Seller is given access, through its employees, agents and
advisers, to all relevant files and/or working papers (with the
right to take copies) in its possession or control to the extent
that they are reasonably required in connection with the
preparation of the draft Completion Statement.
11.2 The draft Completion Statement:
11.2.1 shall include a statement of the apportionments
required to be made pursuant to clauses 10.1 to 10.4;
11.2.2 shall include a statement of any payment required to
be made by the Relevant Buyer to the Relevant Seller
or (as the case may be) vice-versa; and
11.2.3 shall include a statement of any payment required to
be made in respect of the Relevant Stock pursuant to
clauses 10.8 or 10.9 (as the case may be);
11.3 The Relevant Seller shall use its reasonable endeavours to procure
that the draft Completion Statement is submitted to the Relevant
Buyer for review within 20 Business Days after the Completion Date.
The Relevant Seller shall give the Relevant Buyer (and its
employees, agents and advisers) access to all relevant files and/or
working papers (with the right to take copies) in the Relevant
Seller's possession or control to the extent they are reasonably
required for the purposes of the Relevant Buyer's review of the
draft Completion Statement.
11.4 The Relevant Parties shall pay their own respective costs in
connection with the preparation of the draft Completion Statement.
11.5 The draft Completion Statement shall be deemed to have been
accepted by the Relevant Parties as the Completion Statement
unless, within 10 Business Days of it being received by the
Relevant Buyer, the Relevant Buyer delivers to the Relevant Seller
a notice to the contrary (a "DISPUTE NOTICE") specifying:
11.5.1 the item or items disputed;
11.5.2 its reasons; and
11.5.3 how the draft Completion Statement should be adjusted.
11.6 In circumstances where the Relevant Buyer has served a dispute
notice on the Relevant Seller, the Relevant Parties shall attempt
in good faith to resolve any areas of disagreement. If the Relevant
Parties are able to resolve the matters raised in the dispute
notice within 10 Business Days following receipt of the dispute
notice by the Relevant Seller, the draft Completion Statement
(adjusted, if necessary, as agreed between the Relevant Parties)
30
will be deemed to have been accepted by them as the Completion
Statement. No Party shall put in issue any aspect of the draft
Completion Statement which is not the subject of any disagreement.
11.7 If, in the case where a dispute notice is delivered by the Relevant
Buyer, the Relevant Parties are unable to reach agreement within 10
Business Days of it being delivered, the matter(s) in dispute may,
at the written election of either of them, be referred to the
decision of an Independent Expert.
11.8 Following the decision of the Independent Expert, the draft
Completion Statement, as adjusted (if necessary) to reflect the
Independent Expert's decision, will be deemed to have been accepted
by the Relevant Parties as the Completion Statement.
11.9 Any payment required to be made pursuant to the Completion
Statement shall be paid to the Relevant Buyer or the Relevant
Seller (as the case may be) in cash within fifteen Business Days
after agreement or determination (as the case may be) thereof and
shall adjust the purchase price paid for the Relevant Business
accordingly.
12. CONTRACTS AND THIRD PARTY CONSENTS
12.1 Where any consent or agreement of any third party is required to
enable the Relevant Buyer to perform any Contract after Completion
or to enable the relevant member of the Sellers' Group to assign or
novate the benefit or burden of any Contract to the Relevant Buyer,
then the following provisions shall apply:
12.1.1 this Agreement shall not constitute an assignment or
an attempted assignment of the particular Contract if
or to the extent that such an assignment or attempted
assignment would constitute a breach of such Contract;
12.1.2 after Completion, the Relevant Parties shall use their
respective reasonable endeavours to obtain the consent
or agreement of the other party to whatever
assignment, transfer or novation is necessary to
enable the Relevant Buyer to perform such Contract
after Completion or, as the case may be, to transfer
the benefit and burden of such Contract to the
Relevant Buyer;
12.1.3 until the consent or agreement referred to in clause
12.1.2 is obtained, the Relevant Buyer shall, unless
the Contract prohibits it, perform all the obligations
of the relevant member of the Sellers' Group under
such Contract in relation to the Relevant Business as
agent for or sub-contractor to the relevant member of
the Sellers' Group or, if the Contract prohibits the
Relevant Buyer from so acting as agent and
sub-contractor, the Relevant Seller shall, at the
pre-approved cost of the Relevant Buyer, do all such
acts and things as the Relevant Buyer may reasonably
31
require to enable due performance of the Contract and
to provide for the Relevant Buyer the benefit, subject
to the burden, of the Contract. For this purpose, it
shall not be reasonable to require the Relevant Seller
to make any payment under the Contract unless the
Relevant Buyer has first put the Relevant Seller in
cleared funds sufficient to make such payment.
12.2 After Completion, and until such time as the consent or agreement
referred to in clause 12.1 is obtained, the Relevant Seller shall
be deemed to hold the benefit of the Contract on trust for the
Relevant Buyer. The Relevant Buyer shall indemnify the Relevant
Seller (for itself and as trustee for each member of the Sellers'
Group) from and against any act or omission of the Relevant Buyer
to perform or comply with any obligation of the Relevant Seller or
the relevant member of the Sellers' Group which falls to be
performed or complied with under the Contract after Completion.
12.3 Where any consent or agreement of any third party is required to
effect the transfer of any Asset (other than the Properties and the
Contracts) and such consent or agreement has not been obtained on
or before Completion, the sale of such Asset shall not take effect,
notwithstanding Completion, until that consent or agreement has
been obtained and the Relevant Parties shall use their respective
reasonable endeavours after Completion to obtain it as soon as
possible.
12.4 After Completion, and until such time as any consent or agreement
referred to in clause 12.3 is obtained, the Relevant Seller shall
be deemed to hold the benefit of the relevant Asset referred to in
clause 12.3 on trust for the Relevant Buyer.
13. EMPLOYEES
13.1 The Relevant Seller and the Relevant Buyer agree (in each case)
that the sale of the UK Business under this Agreement is a
"relevant transfer" for the purposes of the UK Regulations and the
sale of the Irish Business is a "transfer" for the purposes of the
Irish Regulations and that on Completion the contracts of
employment of the Relevant Assumed Employees and the Relevant
Seller's rights, powers, duties and liabilities under or in
connection with such contracts of employment shall be transferred
to the Relevant Buyer pursuant to the Regulations.
13.2 If the contract of employment of any Relevant Assumed Employee is
found or alleged not to have effect after Completion as if
originally made with the Relevant Buyer as a consequence of the
sale and purchase of the Relevant Business under this Agreement
(other than by virtue of Regulation 5 (4A) of the UK Regulations in
the case of an Assumed UK Employee or, in respect of the Irish
Business, an Assumed Irish Employee who objects to becoming
employed by the Relevant Buyer), the Relevant Buyer agrees that:
13.2.1 in consultation with the Relevant Seller it will,
within five Business Days of being so requested by the
Relevant Seller (so long as the request is made no
32
later than ten Business Days after the Relevant Seller
becomes aware of any such finding or allegation), make
to that Relevant Assumed Employee an offer in writing
to employ him under a new contract of employment to
take effect upon the termination referred to below;
13.2.2 the offer to be made will be such that none of the
terms and conditions of the new contract (other than
the identity of the employer and any terms and
conditions relating to an occupational pension scheme)
will differ from the corresponding provision of the
Relevant Assumed Employee's contract of employment
immediately before Completion; and
13.2.3 upon that offer being made (or at any time after the
expiry of five Business Days if the offer is not made
as requested), the Relevant Seller shall release the
Relevant Assumed Employee concerned from his
employment in the Relevant Business.
13.3 If the contact of employment of any employee of the Relevant Seller
other than a Relevant Assumed Employee is found or alleged to have
effect after Completion as if originally made with the Relevant
Buyer as a consequence of the sale and purchase of the Relevant
Business under this Agreement, the Relevant Seller agrees that:
13.3.1 the Relevant Buyer may, upon becoming aware of any
such contract, terminate it forthwith provided that
prior to the Relevant Buyer taking any action to
terminate any such contract the Relevant Buyer shall
consult with the Relevant Seller; and
13.3.2 it will make to the employee an offer in writing to
employ him under a new contract of employment to take
effect upon the termination referred to above and the
offer will be such that the terms and conditions of
the new contract will be the same as the provisions of
the employee's contract of employment with the
Relevant Seller immediately prior to Completion.
13.4 The Buyers shall indemnify the Sellers (for themselves and as
trustee for each member of the Seller's Group) against all costs,
liabilities, damages and expenses incurred by any member of the
Sellers' Group as a result of:
13.4.1 any breach by the Buyers of the warranties set out in
clause 17.1.3 and 17.1.4;
13.4.2 any claim (other than a claim arising out of or in
connection with any act or omission of the Relevant
Seller) arising from an act or omission of the
Relevant Buyer relating to the terms and conditions of
employment or benefits offered or provided to the
Assumed Employees in connection with their employment
after Completion including, without limitation, claims
relating to the pension or life assurance benefits for
or in respect of the Assumed Employees; and
33
13.4.3 the employment costs for which the Buyers are
responsible pursuant to clause 13.6.
13.5 The Sellers shall be responsible for all emoluments and outgoings
(including bonuses, commissions and employer pension contributions)
which are due and payable to or in respect of the Assumed Employees
up to the Effective Time.
13.6 The Buyers shall be responsible for all emoluments and outgoings
(including bonuses, commissions and employer pension contributions)
which are due and payable to or in respect of the Assumed Employees
on or after the Effective Time.
13.7 The Sellers shall indemnify the Buyers against matters arising from
or in connection with:
13.7.1 the employment costs for which they are responsible
pursuant to clause 13.5;
13.7.2 any claim by any Assumed Employee in respect of any
act or omission of the Sellers before Completion
concerning or arising from his employment with the
Sellers before that date;
13.7.3 any claim by any former or existing employee of the
Sellers or any member of the Sellers' Group (other
than an Assumed Employee) (other than a claim arising
out of or in connection with any act or omission of
the Buyers) which is based on any act or omission of
the Sellers or any member of the Sellers' Group prior
to Completion in respect of which the Buyers incur any
liability as a result of the operation of the
Regulations; and
13.7.4 any claims in connection with or as a result of any
claim (including any individual employee entitlements
under or as a consequence of such a claim) (other than
a claim arising out of or in connection with any act
or omission of the Relevant Buyer) by any trade union
or any other employee representative within the
meaning of the Regulations arising from or connected
with any failure by the Relevant Seller to comply with
any legal obligations to such trade union or any other
employee representative under the Regulations.
14. RISK AND INSURANCE
14.1 Risk in all the Assets shall pass to the Buyer on execution of this
Agreement.
14.2 The Buyers acknowledge and agree that on Completion all insurance
cover provided in relation to the Relevant Business and Relevant
Assets and the Relevant Assumed Employees pursuant to policies
maintained by the Sellers' Group shall terminate.
34
15. VALUE ADDED TAX
15.1 All amounts expressed in this Agreement as being payable by any
Party are expressed exclusive of any VAT which may be chargeable
thereon and the amount of any such VAT shall be payable in addition
thereto subject as hereinafter provided.
15.2 The Relevant Parties shall use all reasonable endeavours to procure
that the conditions of:
15.2.1 article 5(1) of the UK Value Added Tax (Special
Provisions) Order 1995 (SI 1268) and of section 49(1)
of VATA ; and
15.2.2 sections 3(5)(b)(iii) and 5(8) of the Irish Value
Added Tax Act 1972,
are fulfilled so that the sale of the Relevant Business, Relevant
Assets and Relevant Property hereunder is properly treated as
neither a supply of goods nor a supply of services for the purposes
of either UK or Irish VAT.
15.3 Each of the Buyers warrants to the Sellers that:
15.3.1 it is and will at Completion be registered for the
purposes of UK or Irish VAT as appropriate; and
15.3.2 it intends to carry on the same kind of business as
that carried on by the Sellers and does not intend to
dispose of any of the Assets other than the Stock.
15.4 The Relevant Parties shall within 30 days of Completion (insofar as
required by law) give notice of the transfer of the Relevant
Business to the appropriate office of Customs and the Irish Revenue
Commissioners (as the case may be) in accordance with the
applicable regulations.
15.5 Nestle UK shall retain all records referred to in section 49(1) of
VATA 1994 which relate to the UK Business and shall apply to
Customs for a direction under Section 49(1)(b) of VATA that such
records be retained by it, and Nestle UK undertakes to preserve
those records in such a manner and for such periods as may be
required by law and give to the UK Buyer or its agents as from UK
Completion reasonable access during normal business hours to
inspect or copy such records. Nestle UK undertakes that it shall
not at any time cease to preserve such records without giving the
UK Buyer a reasonable opportunity to inspect or remove any of them
as the UK Buyer wishes. If Customs refuses to make such a direction
Nestle UK shall within 20 days of the receipt of the written
notification of such refusal, deliver all such records to the UK
Buyer.
15.6 In the event that either Customs or the Irish Revenue Commissioners
notify the Relevant Seller in writing that VAT is chargeable on the
sale of the Relevant Business, Relevant Assets and Relevant
Property hereunder or any of them, the Relevant Seller shall
immediately deliver to the Relevant Buyer a copy of such
35
notification and the Relevant Buyer shall (against production by
the Relevant Seller of a VAT invoice in respect thereof) pay the
amount of any such VAT to the Relevant Seller as determined by
Customs or the Irish Revenue Commissioners to be so properly due
and chargeable with any interest and penalties thereon by way of
additional purchase price, five Business Days prior to the date on
which the Relevant Seller is due to account for the VAT to Customs
or the Irish Revenue Commissioners, for which the Relevant Seller
may be liable but such payment shall be without prejudice to the
right of the Relevant Buyer under this Agreement to call upon the
Relevant Seller to make or join in any appeal against the aforesaid
determination.
15.7 Before sending any letter to Customs or the Irish Revenue
Commissioners seeking the notification referred to in 15.6, the
Relevant Seller shall give the Relevant Buyer a reasonable
opportunity to comment on it and shall make such amendments as the
Relevant Buyer reasonably requires.
15.8 If the Relevant Buyer pays the Relevant Seller an amount in respect
of VAT under clause 15.6 above and Customs or the Irish Revenue
Commissioners rule (by means of an internal review of any decision
which was notified under clause 15.6 above), that all or part of it
was not properly chargeable, the Relevant Seller shall repay the
amount or the relevant part of it to the Relevant Buyer. The
Relevant Seller shall make the repayment promptly after the ruling,
unless it has already accounted to Customs or the Irish Revenue
Commissioners for the VAT. In that case, the Relevant Seller shall
apply for a refund of the VAT (plus any interest payable by Customs
or the Irish Revenue Commissioners as appropriate), use its best
endeavours to obtain it as soon as possible and pay to the Relevant
Buyer the amount of the refund and any interest immediately when
and to the extent received from Customs or the Irish Revenue
Commissioners.
15.9 All VAT payable in respect of goods and services supplied or deemed
to be supplied by the Relevant Seller in connection with the
Relevant Business prior to Completion, and all interest payable
thereon and penalties attributable thereto, shall be paid to
Customs or the Irish Revenue Commissioners as appropriate, by the
Relevant Seller, and the Relevant Seller shall be entitled to
receive and to retain for its own benefit all reimbursement or
credits from Customs or the Irish Revenue Commissioners as
appropriate, for VAT borne by the Relevant Seller on goods and
services supplied to the Relevant Seller prior to Completion and
any payments received in respect of VAT overpaid to Customs or the
Irish Revenue Commissioners as appropriate, prior thereto.
15.10 The Relevant Seller shall on request make available any information
or documentation in its control reasonably required to establish to
Customs and any tribunal or court that no liability, or a reduced
liability arises on the Relevant Buyer or any other company under
Section 44 of the VATA as result of the sale of the Relevant
Business, Relevant Assets and Relevant Property pursuant to this
Agreement.
36
16. WARRANTIES
16.1 The Sellers hereby warrant to the Buyers (on a joint and several
basis) in the terms of the warranty statements contained in
schedule 3.
16.2 Each of the Warranties shall be construed as a separate warranty
and (save as expressly provided to the contrary) shall not be
limited or restricted by the terms of any of the other warranty
statement.
16.3 The only Warranties given by the Sellers:
16.3.1 in respect of consents and licences, are those
contained in paragraph 7 of schedule 3, and each of
the other Warranties shall be deemed not to have been
given in relation to consents and licences;
16.3.2 in respect of the Properties (or any documents of
title that relate to the Properties), are those
contained in paragraphs 7, 10, 14 and 17 of schedule
3, and each of the other Warranties shall be deemed
not to have been given in relation to the Properties;
16.3.3 in respect of pensions, are those contained in
paragraph 13 of schedule 3, and each of the other
Warranties shall be deemed not to have been given in
relation to pensions;
16.3.4 in respect of Taxation, are those contained in
paragraphs 14 to 21 of schedule 3, and each of the
other Warranties shall be deemed not to have been
given in relation to Taxation.
16.4 The Sellers accept that the Buyers are entering into this Agreement
in reliance upon the Warranties.
16.5 The Buyers acknowledge and agree that (save as provided in the
Warranties) the Sellers make no representation or warranty as to
the accuracy of the forecasts, estimates, projections, statements
of intent or statements of opinion (honestly made) provided to the
Buyers (howsoever provided) on or prior to the date of this
Agreement or in the Disclosure Letter or in the documents provided
to the Buyers or their advisers in the course of the Buyers' due
diligence exercise.
16.6 The provisions of schedule 7 shall operate to qualify or limit (as
the case may be) the liability of the Sellers under and in respect
of the Warranties, and (where stated) all other provisions of this
Agreement.
16.7 Save as expressly stated in paragraph 10.3 of schedule 3, in
schedule 3, where any warranty statement is expressed to be
qualified by the expression "SO FAR AS THE SELLERS ARE AWARE" or
otherwise qualified by reference to the knowledge of the Sellers,
that Warranty shall be deemed to include an additional statement
that the Sellers have made reasonable enquiries of the "SPECIFIED
PERSONS" in relation thereto and on the basis of matters within the
actual knowledge of such persons. The Specified Persons are Peter
Mayes, Andrew Cundiff, David Glik, Maurice Goodson, David Harvey,
37
David Wilkinson, Michael Robertson, Stephanie Dicks and Karen
French in relation to any matter related to the UK Business, and
Eddie Humphreys, Tony Fieldhouse, Denis Casey, John Redmond, Simon
Smith and James Yarr in relation to any matter related to the Irish
Business.
16.8 The Sellers acknowledge that, the Buyers, in themselves giving
warranties to a subsequent buyer of the Business or Assets, may
rely on the Warranties during the period in respect of which the
Buyers will have the benefit of Warranty protection under the terms
of this Agreement.
17. BUYER'S WARRANTIES
17.1 The Buyers hereby warrant to the Sellers (on a joint and several
basis) that:
17.1.1 they and each relevant member of the Buyers' Group,
have the requisite power and authority to enter into
and perform this Agreement and the other documents
which are to be executed by the Buyers and each
relevant member of the Buyers' Group on Completion;
17.1.2 this Agreement constitutes and the other documents to
be executed by the Buyers and each relevant member of
the Buyers' Group on Completion will, when executed by
the Buyers and each relevant member of the Buyers'
Group, constitute binding obligations of the Buyers
and each relevant member of the Buyers' Group in
accordance with their respective terms;
17.1.3 they have provided the Sellers with all the
information the Sellers require in order to comply
fully with their obligations under the Regulations;
and
17.1.4 save in relation to pensions, they shall not make any
change to or otherwise alter the terms and conditions
of employment of the Assumed Employees to the
detriment of the Assumed Employees for a period of six
months following the Completion Date.
18. PROTECTION OF GOODWILL
The Sellers undertake that they will not, and shall procure that
each member of the Sellers' Group will not, within the period of
two years from the date hereof, entice away from the employment of
any member of the Buyers' Group, any Senior Employee.
38
19. ANNOUNCEMENTS
Save as specifically otherwise agreed in writing or as required by
law, by the rules of the UK Listing Authority, London Stock
Exchange or any other stock exchange on which any securities of the
relevant Party are listed or any regulatory or governmental body to
which any Party is subject (provided that the announcing Party has
consulted so far as reasonably practicable with the other Parties
prior to making such announcement), no public announcement shall be
made in respect of the subject matter of this Agreement.
20. CONFIDENTIALITY
20.1 Subject to clause 20.2, each Party shall treat as strictly
confidential all information received or obtained as a result of
entering into or performing this Agreement which relates to:
20.1.1 the provisions of this Agreement or any of the
documents in the Agreed Form;
20.1.2 the making of, or the negotiations relating to this
Agreement or any of the documents in the Agreed Form;
and/or
20.1.3 the other Parties or their business affairs.
20.2 In respect of the information referred to in clause 20.1, any Party
may disclose information which would otherwise be confidential if
and to the extent:
20.2.1 required by law, by the rules of the UK Listing
Authority, London Stock Exchange or any other stock
exchange on which any securities of the relevant Party
are listed or any regulatory or governmental body to
which it is subject;
20.2.2 disclosed to the employees, professional advisers,
auditors, bankers or potential financiers of that
Party whose province it is to know the same and who
shall hold such information on a confidential basis;
20.2.3 required to be disclosed to any relevant Taxation
Authority;
20.2.4 disclosed to its Affiliates, shareholders, controllers
or managers who shall hold such information on a
confidential basis;
20.2.5 the information has come into the public domain
through no fault of that Party; or
20.2.6 the disclosure of such information is necessary to
ensure the compliance of any Party with the terms of
this Agreement or any of the documents in the Agreed
Form.
39
21. ASSIGNMENT
21.1 No Party may assign the benefit of this Agreement whether
absolutely or by way of security, except (in the case of the Buyers
only):
21.1.1 by way of an absolute assignment to another member of
the Buyers' Group; and
21.1.2 by way of security in accordance with the terms of any
arm's length arrangements for the funding (in whole or
in part) of the purchase of the Business, Assets and
Properties under this Agreement or the refinancing of
such funding;
provided that, following an assignment pursuant to clause 21.1.2
above, the assignee may not assign the benefit of this Agreement to
any other person without the express written consent of the Sellers
(save to an Affiliate for so long as it remains an Affiliate of the
permitted assignee under clause 21.1.2 and that assignee continues
to provide funding), and any purported assignment in contravention
of this clause shall be ineffective.
21.2 Subject to clause 21.1, this Agreement shall be binding upon and
shall enure for the benefit of the personal representatives and
permitted assigns and successors in title of each of the Parties,
and references to the Parties shall be construed accordingly.
21.3 Following any assignment in accordance with clause 21.1.2, as
between the Sellers and the Buyers, the Sellers may enforce this
Agreement against the Buyers (and the Guarantor) as if the
assignment had not occurred.
22. COSTS
22.1 Save as otherwise expressly stated in this Agreement, each Party
shall pay its own costs in connection with the negotiation,
preparation and implementation of this Agreement and the documents
in the Agreed Form.
22.2 Any stamp duty payable in respect of or arising in connection with
the sale of the Business, Assets and Properties shall be paid by
the Buyer.
23. ENTIRE AGREEMENT
23.1 Each Party, on behalf of itself and as agent for each of its
Affiliates, acknowledges and agrees with the other Parties (each
such Party acting on behalf of itself and as agent for each of its
Affiliates) that:
23.1.1 this Agreement together with the documents in the
Agreed Form (together the "TRANSACTION DOCUMENTS")
constitutes the entire and only agreement between the
Parties and their respective Affiliates relating to
the subject matter of the Transaction Documents;
40
23.1.2 neither it nor any of its Affiliates has been induced
to enter into any Transaction Document in reliance
upon, nor has any such Party been given any warranty,
representation, statement, assurance, covenant,
agreement, undertaking, indemnity or commitment of any
nature whatsoever other than as are expressly set out
in the Transaction Documents and, to the extent that
any of them has been, it (acting on behalf of itself
and as agent on behalf of each of its Affiliates)
unconditionally and irrevocably waives any claims,
rights or remedies which any of them may otherwise
have had in relation thereto;
23.1.3 save as expressly set out in any Transaction Document:
(a) the only remedies available to it in
respect of the Transaction Documents
(and, where appropriate, to its
Affiliates) are damages for breach of
contract; and
(b) neither it nor its Affiliates, where
appropriate, have any right to rescind or
terminate any Transaction Documents
either for breach of contract or for
negligent or innocent misrepresentation,
PROVIDED THAT the provisions of this clause 23 shall not exclude
any liability which any of the Parties or, where appropriate, their
Affiliates would otherwise have to any other Party or, where
appropriate, to any other Party's Affiliates or any right which any
of them may have in respect of any statements made fraudulently by
any of them prior to the execution of this Agreement or any rights
which any of them may have in respect of fraudulent concealment or
fraudulent omissions by any of them.
24. WAIVER, AMENDMENT
24.1 A waiver of any term, provision or condition of, or consent granted
under, this Agreement shall be effective only if given in writing
and signed by the waiving or consenting Party and then only in the
instance and for the purpose for which it is given.
24.2 No failure or delay on the part of any Party in exercising any
right, power or privilege under this Agreement shall operate as a
waiver thereof, nor shall any single or partial exercise of any
such right, power or privilege preclude any other or further
exercise thereof or the exercise of any other right, power or
privilege.
24.3 No breach of any provision of this Agreement shall be waived or
discharged except with the express written consent of the Relevant
Seller and the Relevant Buyer.
24.4 The rights and remedies herein provided are cumulative with and not
exclusive of any rights or remedies provided by law.
41
24.5 No variation to this Agreement shall be effective unless made in
writing and signed by all the Parties.
25. FURTHER ASSURANCE
25.1 Each of the Parties shall, from time to time on being required to
do so by any other Party, as soon as reasonably practicable and at
the sole cost and expense of the requesting Party, do or procure
the doing of all such reasonable acts and/or execute or procure
execution of all such documents as are necessary for giving full
effect to this Agreement.
25.2 The terms of this Agreement shall, insofar as they are not
performed at Completion, and subject as specifically otherwise
provided in this Agreement continue in force after and
notwithstanding Completion.
26. NOTICES
26.1 Any notice, demand or other communication given or made under or in
connection with the matters contemplated by this Agreement shall be
in writing and shall be delivered personally or sent by fax or
prepaid first-class post (air mail, if posted to or from a place
outside the United Kingdom):
In the case of Nestle UK to:
St. George's House
Croydon
Surrey CR9 1NR
Fax: 020 8667 5775
Attention: Company Secretary
In the case of Nestle Ireland to:
3030 Lake Drive
City West Business Campus
Saggart
Co. Dublin
Fax: 00 353 1451 2823
Attention: Company Secretary
In the case of the UK Buyer to:
Premier Ambient Products (UK) Limited
28 The Green
Kings Norton
Birmingham
B38 8SD
England
Fax: 0121 459 2729
Attention: The Directors
42
(copied to Weil, Gotshal & Manges for the attention of Mike
Francies)
In the case of the Irish Buyer to:
Pastam Limited
28 The Green
Kings Norton
Birmingham
B38 8SD
Fax: 0121 459 2729
Attention: The Directors
(copied to Weil, Gotshal & Manges for the attention of Mike
Francies)
and shall be deemed to have been duly given or made as follows:
26.1.1 if personally delivered, upon delivery at the address
of the relevant Party;
26.1.2 if sent by first class post, two Business Days after
the date of posting; and
26.1.3 if sent by fax, when despatched;
provided that if, in accordance with the above provisions, any such
notice, demand or other communication would otherwise be deemed to
be given or made after 5.00 p.m. on a Business Day such notice,
demand or other communication shall be deemed to be given or made
at 9.00 a.m. on the next Business Day.
26.2 A Party may notify any other Party of a change to its name,
relevant addressee, address or fax number for the purposes of
clause 26.1 provided that such notification shall only be effective
on:
26.2.1 the date specified in the notification as the date on
which the change is to take place; or
26.2.2 if no date is specified or the date specified is less
than five Business Days after the date on which notice
is given, the date falling five Business Days after
notice of any such change has been given.
27. COUNTERPARTS
This Agreement may be executed in any number of counterparts which
together shall constitute one agreement. Any Party may enter into
this Agreement by executing a counterpart and this Agreement shall
not take effect until it has been executed by all Parties.
43
28. GOVERNING LAW
28.1 This Agreement (and any dispute, controversy, proceedings or claim
of whatever nature arising out of or in any way relating to this
agreement or its formation) shall be governed by and construed in
accordance with English law.
28.2 The Parties submit to the non-exclusive jurisdiction of the High
Court of Justice in London for the purpose of hearing and
determining any dispute arising out of this Agreement and for the
purpose of the enforcement of any judgement against their
respective assets.
29. INVALIDITY
29.1 If any provision of this Agreement is or becomes invalid, illegal
or unenforceable in any respect under the law of any jurisdiction:
29.1.1 the validity, legality and enforceability under the
law of that jurisdiction of any other provision; and
29.1.2 the validity, legality and enforceability under the
law of any other jurisdiction of that or any other
provision,
shall not be affected or impaired in any way.
30. PENSIONS
The provisions of schedule 6 shall have effect in relation to
pensions.
31. INDEPENDENT EXPERT
31.1 Where any matter in this Agreement is to be referred to the
decision of an Independent Expert, the provisions of this clause 31
will apply to his appointment and terms of reference.
31.2 The Independent Expert shall be an independent chartered accountant
to be appointed (in default of nomination by agreement between the
Sellers and the Buyers) by the President for the time being of the
Institute of Chartered Accountants in England and Wales on the
written application of the Relevant Seller or of the Relevant Buyer
(whichever applies first). The Independent Expert shall act as an
expert and not as arbitrator and neither the Arbitration Act 1996
nor any earlier or later enactments on arbitration shall apply. The
Independent Expert's decision shall (in the absence of gross or
manifest error) be final and binding on the Relevant Parties for
all the purposes of this Agreement.
31.3 Each of the Relevant Parties shall promptly on request supply to
the Independent Expert such documents and information as the
Independent Expert may require for the purpose of the reference.
44
31.4 The costs of the Independent Expert shall be apportioned between
the Relevant Parties as the Independent Expert shall decide but
each Relevant Party shall be responsible for its own costs of
presenting its case to the Independent Expert. If the Independent
Expert shall not determine how its costs shall be determined, his
costs shall be borne equally between the Relevant Seller (on the
one hand) and the Relevant Buyer (on the other).
32. THIRD PARTY RIGHTS
32.1 Any person (other than the Parties) who is given any rights or
benefits under clause 23 (a "THIRD PARTY") shall be entitled to
enforce those rights or benefits against the Parties in accordance
with the Contracts (Rights of Third Parties) Act 1999.
32.2 Save as provided in clause 32.1, the operation of the Contracts
(Rights of Third Parties Act) 1999 is hereby excluded.
32.3 The Parties may, amend, vary or terminate this agreement in such a
way as may affect any rights or benefits of any Third Party which
are directly enforceable against the parties under the Contracts
(Rights of Third Parties) Act 1999 without the consent of such
Third Party.
32.4 Any Third Party entitled pursuant to the Contracts (Rights of Third
Parties) Act 1999 to enforce any rights or benefits conferred on it
by this Agreement may not veto any amendment, variation or
termination of this agreement which is proposed by the Parties and
which may affect the rights or benefits of the Third Party.
33. RESTRICTED FINANCIAL TRANSFERS
Nestle Ireland declares for the purposes of the Financial Transfers
Act, 1992 of Ireland that it is not resident in any jurisdiction to
which financial transfers (within the meaning of the said Act) are
restricted by order of the Irish Minister for Finance in accordance
with the provisions of that Act and does not hold any of the Irish
Assets or Irish Property and will not receive any part of the Irish
Cash Consideration as nominee for any person so resident, and the
Irish Buyer declares for the purposes of the said Act that it is
not so resident, it is not acquiring the Irish Assets or Irish
Property as nominee for any person so resident and it is not
controlled directly or indirectly by persons so resident.
34. GUARANTEE
34.1 The Guarantor, as primary obligor and not as surety only,
irrevocably and unconditionally for the benefit of the Relevant
Beneficiaries:
45
34.1.1 guarantees to the Relevant Beneficiaries (in
consideration of the Relevant Beneficiaries promising
by this clause each severally to pay it the sum of
(pound)1 on demand) the due and punctual performance
of, and the due payment and discharge of all sums and
liabilities which now are or at any other time shall
be due, owing or incurred by the Relevant Obligors to
its Relevant Beneficiaries in respect of the Relevant
Obligations; and
34.1.2 undertakes that if any amount guaranteed by this
clause is not recoverable on the basis of a guarantee
for any reason it will (as a separate and independent
stipulation) pay the Relevant Beneficiaries on demand
whatever amount or amounts shall equal what it would
have been liable to pay but for such irrecoverability
and shall indemnify the Relevant Beneficiaries against
all costs, liabilities and expenses suffered or
incurred by the Relevant Beneficiaries in connection
with such irrecoverability.
34.2 This is a continuing guarantee and the Guarantor's undertakings
under this Agreement shall remain in full force and effect until
final performance in full of its obligations under this Agreement
notwithstanding any intermediate payment or performance or the
invalidity or unenforceability in whole or in part of the
respective Relevant Obligations or any other event.
34.3 The guarantee and undertakings contained in this clause shall be
discharged in relation to the Guarantor by the full performance of
its obligations under this Agreement, but otherwise shall not be
discharged or affected by any act, omission, matter or thing which,
but for this provision, might operate to release or otherwise
exonerate the Guarantor from those obligations in whole or in part
including:
34.3.1 the granting of time, or any waiver or other
indulgence (including any extension, renewal,
acceptance, forbearance or release in respect of any
Relevant Obligations or any of the Guarantor's
obligations under this Agreement);
34.3.2 the taking, variation, compromise, renewal or release
of or refusal or neglect to perform or enforce any
rights, remedies or securities against the Relevant
Obligors or any other person;
34.3.3 any modification, variation or addition to the terms
of any Relevant Obligations or of any other document
or security;
34.3.4 any irregularity, defect or informality in the terms
of any Relevant Obligations or any other document or
security or any legal limitation, disability,
incapacity or want of authority of any person;
34.3.5 any transfer or assignment of any rights or
obligations by any Party, whether or not they relate
to Relevant Obligations;
46
34.3.6 any corporate reorganisation, reconstruction,
amalgamation, dissolution, liquidation, merger,
acquisition of or by or other alteration in the
corporate existence or structure of any Party, or the
non-existence of the Relevant Obligors; or
34.3.7 any composition or similar arrangement by any Party or
any other person
34.4 Where any discharge (whether in respect of any Relevant Obligations
or any security for Relevant Obligations or otherwise) is made in
whole or in part or any arrangement is made on the faith of any
payment, security or other disposition which is avoided or must be
restored for any reason, any liability of the Guarantor under this
Agreement which in the absence of this clause would be released by
virtue of that discharge or arrangement shall continue as if the
discharge or arrangement had not been made.
34.5 This guarantee and indemnity is in addition to and is not in any
way prejudiced by any other security now or in future held by or on
behalf of the Relevant Beneficiaries.
34.6 In this clause:
34.6.1 "RELEVANT BENEFICIARIES" means, in relation to the
obligations of the Guarantor, each of the Sellers;
34.6.2 "RELEVANT OBLIGORS" means, in relation to the
obligations of the Guarantor, each of the Buyers; and
34.6.3 "RELEVANT OBLIGATIONS" means the Relevant Obligors'
obligations to either or both of the Relevant
Beneficiaries under this Agreement and under any
agreements between the Relevant Parties which are
expressed to be supplemental to this Agreement or
which this Agreement expressly preserves or requires
to be executed.
IN WITNESS whereof this Agreement has been executed on the date first above
written.
47
Signed by )
for and on behalf of ) /s/ Nestle UK Ltd.
NESTLE UK LTD. )
Signed by )
for and on behalf of ) /s/ Nestle (Ireland) Limited
NESTLE (IRELAND) LIMITED )
Signed by )
for and on behalf of ) /s/ Premier Ambient Products
PREMIER AMBIENT PRODUCTS ) (UK) Limited
(UK) LIMITED )
Signed by )
for and on behalf of ) /s/ Pastam Limited
PASTAM LIMITED )
Signed by )
for and on behalf of ) /s/ Premier Financing Limited
PREMIER FINANCING LIMITED )