EXECUTION COPY
FRANCHISE ACQUISITION AGREEMENT
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THIS AGREEMENT is executed and delivered this 29th day of
September, 2000, by and among WVBC, INC., a Delaware corporation ("WVBC"), ROBC,
INC., a Delaware corporation ("ROBC") (WVBC and ROBC are sometimes referred to
herein collectively as the "Sellers" and individually as a "Seller"), and
COCA-COLA ENTERPRISES INC., a Delaware corporation ("Enterprises").
IN CONSIDERATION of the representations, warranties, covenants
and agreements contained in this Agreement, the parties, intending to be legally
bound, hereby agree as follows:
1 ARTICLE
PURCHASE OF FRANCHISE ASSETS AND RIGHTS;LIABILITIES EXCLUDED AND
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ASSUMED
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1.1 Franchise Assets. At the Closing (as defined in Section 7.01), subject to
the terms and conditions of this Agreement, Sellers shall sell, assign, convey,
transfer, and deliver to Enterprises, and Enterprises shall purchase, accept and
acquire from Sellers, the Franchise Assets (as defined below): The "Franchise
Assets" shall consist collectively of all right, title and interest of Sellers
in and to: (i) all licenses and contract rights incident thereto in connection
with the Bottling Authorizations (as defined in Section 3.02(a)) listed in
Disclosure Schedules 3.02(a) and (b); and (ii) all licenses and contract rights
incident thereto in connection with the License Agreements (as defined in
Section 3.02(c)) listed on Disclosure Schedule 3.02(c). Excluded Assets.
Notwithstanding anything contained herein to the contrary, it is understood that
all assets of Sellers other than the Franchise Assets are specifically excluded
from transfer to Enterprises, including but not limited to: cash, cash
equivalents, accounts receivable, bank accounts, partnership interests,
marketable or other securities, commercial paper, all minute books, and all
corporate, partnership, financial and income tax records not specifically
included in the Franchise Assets (all such assets being hereinafter referred to
collectively as the "Excluded Assets").
1.1 Excluded Liabilities.
1.2
(a) Except with respect to the Assumed Liabilities described in Section 1.04
hereof, or as otherwise expressly indicated elsewhere in this Agreement,
Enterprises shall not assume, nor shall it agree to pay, perform or discharge
any liability or obligation of any kind or nature whatsoever of Sellers
(collectively, the "Excluded Liabilities"), including, without limitation,
(i) any liability for indebtedness of any Seller evidenced by bonds, debentures,
notes or similar instruments or for the deferred purchase price of property;
(i) any liability to pay any Taxes of any Seller, regardless of whether the
liability for such Taxes exists now or in the future, or in connection with the
consummation of the transactions contemplated hereby or otherwise;
(i) any liability to pay the Taxes of any other person or entity (other than
Sellers) because any Seller was a member of an affiliated group under Section
1504(a) of the Internal Revenue Code of 1986, as amended ("IRC") or any similar
state tax provision;
(i) any liability or obligation with respect to the Excluded Assets;
(i) any obligation to indemnify any person by reason of the fact that such
person was a director, officer, employee or agent of any Seller or was serving
at the request of any Seller as a partner, trustee, director, officer, employee
or agent of another entity;
(i) any liability (1) in the event of any claims brought by employees or former
employees of any Seller claiming employment discrimination under state or
federal law, or (2) from any labor disputes between any Seller and the labor
unions representing its employees, including without limitation strikes or
picketing, wherever they may occur;
(i) any liability with respect to any employment, collective bargaining or
consulting contract, or deferred compensation, profit-sharing, pension, bonus,
stock option, stock purchase or any other fringe benefit or compensation
contract, commitment, arrangement or plan (whether written or oral) including
each welfare plan (as defined in Section 3(1) of the Employee Retirement
Security Act of 1974, as amended ("ERISA")), which any Seller has established
or maintained or in which any Seller has had an obligation to make contributions
or to pay benefits, for the benefit of persons who are, were, or will become in
accordance with the terms of the plan, active employees, former employees,
retirees, directors or independent contractors (or their descendants, spouses or
beneficiaries) of any Seller or their predecessors in interest or any employer
that would constitute an "ERISA Affiliate", which term will refer to all
employers that by reason of common control are treated together with any Seller
as a single employer within the meaning of IRC section 414;
(i) any liability for payments to employees of any Seller under the Worker
Adjustment and Retraining Notification Act (the "WARN Act") or the Family and
Medical Leave Act of 1993;
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(i) any liability for offering and providing COBRA continuation coverage prior
to the Closing Date to any qualified beneficiary who is covered by a group
health plan (where, for the purposes of this subsection 1.03(a)(ix), the terms
"continuation coverage," "qualified beneficiary" and " group health plan" have
the meanings given such terms under IRC section 4980B and ERISA section 601 et
seq.);
(i) any liability arising on or before the Closing Date for commitments relating
to the employment, relocation or termination of any employees of any Seller
including, without limitation, accrued salary or severance pay;
(i) any liability for Sellers' costs and expenses incurred in connection with
this Agreement and the transactions contemplated hereby;
(i) any liability or obligation of Sellers arising or incurred after the
Closing;
(i) any liability or obligation arising under the Franchise Assets on or prior
to the Closing Date; and
(i) any liability of any Seller that becomes a liability of Enterprises under
any common law doctrine of de facto merger or successor liability, or otherwise
by operation of law).
(a) Sellers shall remain liable for, and shall discharge to the extent properly
due and payable, all of the Excluded Liabilities with respect to which failure
to so discharge would adversely affect Enterprises.
1.1 Assumed Liabilities.
1.2
(a) At the Closing, Enterprises shall assume only the liabilities and
obligations of the Sellers under the Franchise Assets arising on or after the
Closing Date (the "Assumed Liabilities").
(a) Enterprises shall be liable for, and shall discharge, when due, all of the
Assumed Liabilities.
(b)
(c) Except as expressly set forth in this Section 1.04, Enterprises shall not
assume or in any way be liable for any obligation or liability of any Seller,
whether known or unknown, fixed or contingent, or incurred before or after the
Closing.
(d)
(e)
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2 ARTICLE
THE PURCHASE PRICE
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1.1 Purchase Price. The purchase price for the Franchise Assets shall be
$18,513,023 (the "Franchise Purchase Price"), paid at the Closing by wire
transfer to the bank accounts set forth on Exhibit 2.01.
1.2
1.3 Allocation of Purchase Price. The Franchise Purchase Price shall be
allocated for federal and state tax purposes in the manner specified in Exhibit
2.02 with such adjustments as may be mutually agreeable to Enterprises and
Sellers. Each of the parties to this Agreement (a) acknowledges that such
allocation complies with the requirements of Section 1060 of the IRC and the
regulations promulgated thereunder and (b) shall file Form 8594 with its United
States Federal Income Tax Return and any related or analogous filings required
under any state laws, or otherwise, consistent with such allocation, for the tax
year in which the Closing occurs.
1.4
1.5
1.6
1.7
1.8
1.9
1.10
2 ARTICLE
REPRESENTATIONS AND WARRANTIES CONCERNINGSELLERS
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As an inducement to the execution of this Agreement by
Enterprises and the consummation of the transactions contemplated hereunder,
Sellers, jointly and severally, hereby represent and warrant to Enterprises as
follows as of the date of this Agreement and as of the Closing Date:
1.1 Organization and Authorization.
1.2
(a) Sellers are corporations duly organized, validly existing and in good
standing under the laws of the State of Delaware. Each Seller is an indirect
wholly owned subsidiary of Coca-Cola Bottling Co. Consolidated, a Delaware
corporation ("Consolidated"). Each Seller was incorporated under Delaware law on
November 23, 1993 and since that date neither Seller has engaged in any merger,
consolidation, share exchange or other combination with any entity. The sole
purpose of each Seller is now and has always been to hold the Bottling
Authorizations and to license and grant interests therein to corporate
affiliates of Consolidated pursuant to the License Agreements. Neither Seller
has conducted any other business.
(b)
(c) Each Seller has the full corporate power and authority to enter into this
Agreement and all other agreements, documents and certificates contemplated or
required of it hereby (collectively, the "Seller Documents") and to consummate
the transactions contemplated
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under this Agreement and the Seller Documents. The execution and delivery of
this Agreement and each Seller Document by Sellers and the consummation by each
Seller of the transactions contemplated hereby and thereby have been duly
approved by Sellers, and no corporate or other action on the part of any Seller
or their shareholders is necessary to approve and authorize the execution and
delivery of this Agreement and each Seller Document or the consummation of the
transactions contemplated hereby or thereby. This Agreement and each Seller
Document have been duly and validly executed and delivered by each Seller and
constitute the valid and binding agreements of Sellers, enforceable against them
in accordance with their respective terms.
(d)
(e) The execution and delivery of this Agreement and each Seller Document by
Sellers and the consummation by Sellers of the transactions contemplated by this
Agreement and the Seller Documents will not:
(f)
(i) violate or conflict with any provision of the certificates of
incorporation or bylaws of any Seller;
(i) breach, violate or constitute an event of default (or an event that
with the lapse of time, or the giving of notice, or both, would
constitute an event of default) under or give rise to any right of
termination, cancellation, modification or acceleration under, any
note, bond, indenture mortgage, security agreement, lease, license,
franchise (excluding the Bottling Authorizations) collective bargaining
agreement or any other material agreement, instrument or obligation to
which any Seller is a party, or by which any Seller or any of their
properties or assets are bound;
(i) result in the creation of any lien, claim or encumbrance or other
right of any third party of any kind whatsoever upon the Franchise
Assets pursuant to the terms of any such instrument or obligation;
(i) violate or conflict with any Order or Law, where:
(A) "Order" means any award,
decision, injunction, judgment, order, ruling, subpoena or
verdict entered, issued or made or rendered by any
Governmental Authority or arbitrator;
(B) "Law" means any law, ordinance,
principle of common law, regulation, statute or treaty,
whether federal, state, local, municipal, foreign,
international or multinational; and
(C) "Governmental Authority" means
any court, tribunal or panel, and any government, government
agency, authority or regulatory body, whether federal, state,
local, municipal, foreign, international or multinational;
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(v) require, on the part of any
Seller, any filing or registration with, or permit, license,
exemption, consent, authorization or approval of, or the
giving of any notice to, any Governmental Authority, except
for the premerger notification requirements of the
Hart-Scott-Rodino Antitrust Improvements Act of 1976, as
amended (the "HSR Act") and such filings, registrations,
permits, licenses, consents, authorizations or approvals
which, if not made or obtained, as the case may be, would not,
in the aggregate, have a material adverse effect on the
business, operations, properties, assets, financial condition,
results of operations or prospects of any Seller taken as a
whole.
1.1 Bottling Authorizations.
1.2
(a) To Sellers' knowledge, Sellers have in effect all authorizations from
concentrate franchise companies to bottle, distribute and sell soft drink and
other nonalcoholic beverage products of The Coca-Cola Company that are necessary
for Sellers to conduct their respective businesses within the portions of the
states of Ohio and Kentucky in which such distributions are made pursuant to the
Master Bottle Contract between The Coca-Cola Company, a Delaware corporation
("The Coca-Cola Company") and Coca-Cola Bottling Works of Charleston, Inc.,
dated December 31, 1986; the Master Bottle Contract between The Coca-Cola
Company and Coca-Cola Bottling Works of Charleston, Inc. (Huntington, WV
Territory), dated December 31, 1986; and the Master Bottle Contract between The
Coca-Cola Company and Lonesome Pine Coca-Cola Bottling Company dated January 27,
1989 (collectively, the "Territory"). As further clarification, the Territory's
boundary will follow the Ohio and Kentucky state lines as they border the states
of Virginia and West Virginia. All such authorizations within the Territory (the
"Bottling Authorizations") are listed in Disclosure Schedule 3.02(a).
(a) All Bottling Authorizations giving Sellers the temporary right to sell soft
drinks and other nonalcoholic beverage products in any portion of the Territory
that is within the territory of another bottler that is not an affiliate of
Consolidated are specifically identified in Disclosure Schedule 3.02(b).
(b)
(c) Sellers have made no assignment of any right or interest in the Bottling
Authorizations other than to CCBCWV and CCBCR pursuant to the license agreements
(the "License Agreements") which are listed on Disclosure Schedule 3.02(c).
1.1 Taxes.
1.2
(a) All Taxes, deposits or other payments or withholdings for which any Seller
has any liability under any Law through the date of this Agreement and at the
Closing Date (whether or not shown on any Return) have either been paid in full,
or will be paid on or before the date that such Taxes are due to be paid
(including any extensions thereof).
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(a) All Returns of any Seller that are due to have been filed in accordance with
any Law have been filed, and all such Returns are correct and complete in all
material respects.
(b)
(c) For purposes of this Agreement:
(d)
(i) "Taxes" means all taxes, assessments, charges, duties, fees,
levies or other governmental charges, including federal, state, city,
county, parish, foreign or other income, franchise, capital stock, real
property, personal property, tangible, withholding, social security (or
similar), unemployment compensation, disability, environmental
(including taxes under section 59A of the IRC), transfer, sales, soft
drink, use, excise, gross receipts, alternative or add-on-minimum,
estimated and all other taxes of any kind for which any Seller may have
any liability imposed by any Governmental Authority (including
interest, penalties or additions associated therewith), and including
any transferee or secondary liability in respect of any tax (whether
imposed by law, contractual agreement or otherwise) and any liability
in respect of any tax as a result of being a member of any affiliated,
consolidated, combined, unitary or similar group and shall include all
liabilities of any Seller under any unclaimed property Law applicable
to such Seller; and
(i) "Returns" means all returns, declarations, reports, statements,
claims for refunds, estimated returns or reports, and other documents
required to be filed in respect of Taxes, including any amendments or
supplements to any of the foregoing.
1.1 Judgments, etc.. There are no judgments, orders, injunctions, decrees,
stipulations or awards (whether rendered by a court, administrative agency, or
by arbitration, pursuant to a grievance or other procedure) affecting the
Franchise Assets or Sellers' operations that are, or will become upon
consummation of the transactions contemplated by this Agreement, binding upon
Enterprises, or will create a lien or any other encumbrance on the Franchise
Assets.
1.2
1.3 No Other Consolidated Affiliates within the Territory. Except for Sellers,
The Coca-Cola Bottling Company of West Virginia, Inc. and Coca-Cola Bottling
Company of Roanoke, Inc., no affiliate of Consolidated owns any asset or is a
party to any contract relating to the operating of any business in the Territory
other than the Metrolina Bottling Company, the affiliate of Consolidated that
owns the Bottling Authorizations for Seagram in the Territory.
1.4
1.5 Copies. True and correct copies of the Disclosure Schedules are attached
hereto and incorporated herein by reference and true and correct copies of all
documents referred to therein have been made available to or delivered to
Enterprises.
1.6
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2 ARTICLE
REPRESENTATIONS AND WARRANTIES OF ENTERPRISES
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As an inducement to the execution of this Agreement by Sellers
and the consummation of the transactions contemplated hereunder Enterprises
hereby represents and warrants to Sellers as follows as of the date of this
Agreement and as of the Closing Date:
1.1 Organization and Authorization. Enterprises is a corporation duly
organized, validly existing and in good standing under the laws of the State of
Delaware.
1.2 Authorization of the Transaction. Enterprises has the full corporate power
and authority to enter into this Agreement and all other agreements, documents
and certificates contemplated or required of it hereby (collectively, the "Buyer
Documents") and to consummate the transactions contemplated under this Agreement
and the Buyer Documents. The execution and delivery by Enterprises of this
Agreement and each of the Buyer Documents and the consummation by Enterprises of
the transactions contemplated hereby and thereby have been duly approved by the
board of directors of Enterprises, and no other corporate action on the part of
Enterprises is necessary to approve and authorize the execution and delivery of
this Agreement and each of the Buyer Documents or to consummate the transactions
contemplated under this Agreement and the Buyer Documents. This Agreement and
each of the Buyer Documents have been duly and validly executed and delivered by
Enterprises and constitute the valid and binding agreements of Enterprises,
enforceable against Enterprises in accordance with their respective terms.
1.3
1.4 Non-contravention. The execution and delivery of this Agreement and each of
the Buyer Documents by Enterprises and the consummation by Enterprises of the
transactions contemplated hereby and thereby will not:
1.5
(a) violate or conflict with any provision of the certificate of incorporation
or bylaws of Enterprises;
(b)
(c) breach, violate or constitute an event of default (or an event which with
the lapse of time or the giving of notice, or both, would constitute an event of
default) under, or give rise to any right of termination, cancellation,
modification or acceleration under, any note, bond, indenture, mortgage,
security agreement, lease, license franchise or other material agreement,
instrument or obligation to which Enterprises is a party, or by which
Enterprises or any of its properties or assets is bound;
(d)
(e) result in the creation of any lien, claim or encumbrance or other right of
any third party of any kind whatsoever upon the properties or assets of
Enterprises pursuant to the terms of any such instrument or obligation;
(f)
(g) violate or conflict with any Order or Law;
(h)
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(i) (except for anything that would be a breach of the representations in the
foregoing clauses (b), (c) and (d), but would not, individually or in the
aggregate, have a material adverse effect on the operations, properties, assets,
financial condition, results of operations or prospects of Enterprises); or
(j)
(k) require, on the part of Enterprises, any filing or registration with, or
permit, license, exemption, consent, authorization or approval of, or the giving
of any notice to, any Governmental Authority except for the premerger
notification requirements of the HSR Act and such filings, registrations,
permits, licenses, consents, authorizations or approvals which, if not made or
obtained, as the case may be, would not, in the aggregate, have a material
adverse effect on the business, operations, properties, assets, financial
condition, results of operations or prospects of Enterprises.
(l)
(m)
2 ARTICLE
OTHER AGREEMENTS
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1.1 Expenses. Except as may be otherwise provided herein, each party hereto
shall pay all costs and expenses incurred by such party or on such party's
behalf in connection with this Agreement and the transactions contemplated
hereby.
1.1 Brokerage Commissions. Sellers and Enterprises hereby represent and warrant
for the benefit of the other parties that no person, firm, corporation or other
entity is entitled to any brokerage commission or finder's fee in connection
with any of the transactions contemplated by this Agreement.
1.2
1.3 Access. For the purpose of conducting, at Enterprises' expense, a
financial, business, and legal due diligence review of the Sellers, Sellers
agree that until the Closing or earlier termination of this Agreement they shall
(a) provide Enterprises with such information as Enterprises may from time to
time reasonably request with respect to them and the transactions contemplated
by this Agreement; (b) provide Enterprises and its officers, counsel and other
authorized representatives access during regular business hours to their
facilities, books, records (financial and other), officers, employees,
accountants (and the accounting work papers), lawyers and consultants, as
Enterprises may from time to time reasonably request; and (c) permit Enterprises
to make such investigation thereof as Enterprises may reasonably request.
1.4
1.5 Other Offers. So long as this Agreement shall not have been terminated,
neither Seller shall solicit or entertain any offer for, or sell or agree to
sell, or participate in any business combination with respect to the Franchise
Assets.
1.6
1.7 Transfer Taxes. To the extent reasonably requested by a party to this
Agreement, each of the parties will use its reasonable, good faith efforts
legally to minimize any sales, use and/or transfer Taxes associated with the
transactions contemplated by this Agreement; provided,
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however, that this shall not require any party (a) to take actions requiring the
expenditure of money without reimbursement from the requesting party or
incurrence of additional Taxes that are not sales, use and/or transfer Taxes; or
(b) to take a position on a Return inconsistent with positions taken on other
Returns of such party.
2 ARTICLE
INDEMNIFICATION
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1.1 Certain Definitions. As used in this Agreement:
1.2
(a) "Buyer's Protected Parties" means Enterprises and its affiliated companies,
and the successors or assigns, officers, directors, employees and agents of the
foregoing.
(a) "Claim" or "Claims" means a claim for Losses asserted by an Indemnified
Party under this Article VI.
(b)
(c) "Sellers' Protected Parties" means WVBC, ROBC, and their affiliated
companies, and the successors or assigns, officers, directors, employees and
agents of the foregoing.
(d)
(e) "Finally Resolved" means that the amount due to the Buyer's Protected
Parties or Sellers' Protected Parties, as the case may be, has been finally
determined under the provisions of Section 6.05, or by agreement of the parties,
or by the decision of a court of competent jurisdiction from which there is no
further appeal.
(f)
(g) "Indemnified Party" means any party entitled to receive indemnification
under this Article VI.
(h)
(i) "Indemnifying Party" means any party required to provide indemnification
under this Article VI.
(j)
(k) "Loss or Losses" means claims, losses, liabilities, damages, costs
(including court costs) and expenses (including the reasonable fees of
attorneys). Any Losses shall be computed net of any insurance proceeds or other
recovery received from any third party by any Indemnified Party in respect of or
as a result of such Loss or the facts or circumstances relating thereto.
(l)
1.2 Indemnification of Buyer's Protected Parties. Sellers shall indemnify
Buyer's Protected Parties for the amount of any Losses suffered or incurred by
any of Buyer's Protected Parties arising out of or with respect to:
1.3
(a) any breach or inaccuracy of any representation or warranty contained in
Article III or in the closing certificate delivered pursuant to Section 7.05(a);
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(b)
(c) any breach of or noncompliance by Sellers with any covenant or agreement
made by Sellers in this Agreement or in any document signed on behalf of any
Seller and delivered on its behalf at the Closing; and
(d)
(e) any Excluded Liability;
(f)
(g) 6.03 Indemnification of Sellers' Protected Parties. Enterprises shall
indemnify Sellers' Protected Parties for the amount of any Losses suffered or
incurred by any of Sellers' Protected Parties arising out of or with respect to:
(h)
(i) (a) any breach or inaccuracy of any representation or warranty contained in
Article IV or in the closing certificate delivered pursuant to Section 7.06(a);
(j)
(k) (b) any breach of or noncompliance by Enterprises with any covenant or
agreement made by Enterprises in this Agreement or in any document signed on
behalf of Enterprises and delivered on its behalf at the Closing; and
(l)
(m) (c) any failure of Enterprises to perform and discharge in full, in a due
and timely manner, the Assumed Liabilities.
6.04 Limitations.
(a) The maximum amount of Losses which may be
recovered in the aggregate under Section 6.02 or Section 6.03 hereof and under
Article VI of the Concurrent Agreement (as defined in Section 7.01) shall not
exceed the sum of the Franchise Purchase Price and the Asset Purchase Price (as
defined in the Concurrent Agreement), provided, however, that the maximum amount
of Losses which may be recovered in aggregate under Section 6.02 or Section 6.03
hereof and under Article VI of the Concurrent Agreement, with respect to Claims
first asserted after the second anniversary of the Closing Date, shall not
exceed the sum of all claims outstanding on such second anniversary and $10
million.
(b) No Claim may be asserted under Section 6.02 or
Section 6.03 until the aggregate of the Losses claimed hereunder and under the
Concurrent Agreement first exceeds $250,000 (the "Deductible"), and thereafter
only to the extent of the excess; subsequent Claims may be asserted
dollar-for-dollar. Provided however, that the Deductible shall not apply to (i)
a single Claim equal to or exceeding $250,000 or a group of Related Claims equal
to or exceeding $250,000; and (ii) any Claim asserted under Section 6.02(c). For
purposes hereof, "Related Claims" shall mean claims arising from a breach of an
individual representation or warranty that arose contemporaneously, or from the
same transaction, occurrence or condition. By way of example, a shortage of 100
items of inventory on the Closing Date, even if submitted as 100 Claims, would
be deemed Related Claims.
(c) The representations and warranties contained in
this Agreement shall survive the Closing notwithstanding any investigation or
examination of Sellers and
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Enterprises. Claims under Section 6.02 or Section 6.03 may be asserted only
prior to the second anniversary of the Closing Date, except that Claims based on
Section 3.03 ("Taxes") may be asserted any time prior to the 90th day following
the expiration of the applicable statute of limitations.
6.05 Procedure for Claims.
(a) Claims must be asserted as promptly as
practicable and within the periods allowed by Section 6.04(c). Each notice of a
Claim must be given as provided in Section 9.02 of this Agreement, set forth in
reasonable detail the basis for the Claim, and cite the section of this
Agreement under which the Claim arises.
(b) Within 60 days after the receipt of a Claim, the
Indemnifying Party must give the Indemnified Party notice that it either agrees
with the Claim or disputes it. If the Indemnifying Party objects to the Claim,
the parties shall negotiate in good faith to determine the amount, if any, of
the Loss. If no resolution of the Claim has occurred within 180 days after the
receipt of the Claim, then the parties shall submit the dispute to mediation
with a mutually agreeable mediator. If no resolution of the Claim has occurred
within 250 days following receipt of the Claim, either party may institute
proceedings in a court of competent jurisdiction to resolve the Claim.
6.06 Source of Recovery; Payment of Claims. When a Claim has
been Finally Resolved under this Article VI, if the Indemnifying Party shall not
have paid such Claim within 30 days of the date such Claim has been Finally
Resolved, the Indemnifying Party shall pay to the Indemnified Party an amount
equal to such Claim plus 7% annual interest accruing from the date such Claim is
Finally Resolved.
6.07 Third Party Action. When a Claim arises out of the claim
of a third party (the "Third Party Action"), including any audit or liability
for sales, use and transfer Taxes or other Taxes arising out of the consummation
of the transactions contemplated hereby (while any notice or audit relating to
Taxes shall be delivered promptly to the Indemnifying Party, such notice or
audit shall, while constituting a Claim, not be subject to the 180 and 250 time
limitations set forth in Section 6.05(b) until an assessment has been issued by
the third party), then the party receiving notice of the Claim shall promptly
provide notice to the other parties, and the Indemnifying Party may, at its
expense, assume the defense thereof by prompt written notice to the Indemnified
Party. If the Indemnifying Party cannot or does not elect this option, the
Indemnified Party shall defend or settle the Third Party Action. Where the
Indemnifying Party has undertaken to defend the Third Party Action, (1) the
Indemnified Party may participate, at its own expense, in any and all
proceedings related to the Third Party Action and shall be entitled to receive
copies of all notices and pleadings or other submissions in any judiciary or
regulatory proceeding; and (2) there shall be no settlement requiring any action
on the part of the Indemnified Party, other than payment of the settlement
payment, without the consent of the Indemnified Party, which shall not be
unreasonably withheld. All parties to this Agreement shall cooperate in the
defense of Third Party Actions and shall furnish such records, information and
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testimony, and shall attend such conferences, discovery proceedings, hearings,
trials and appeals, as may be reasonably requested in connection therewith.
6.08 Duty to Mitigate. Notwithstanding anything in this
Article VI, the Indemnified Party shall have a duty to make commercially
reasonable efforts to mitigate Losses asserted hereunder.
6.09 Exclusive Remedy. Except for common law fraud, the
indemnification provisions of this Article VI shall be the exclusive remedy
following the Closing for any claim related to the transactions contemplated
hereby, including without limitation, any breaches or alleged breaches of any
representation, warranty or failure to fulfill any covenants or agreement
contained herein.
1 ARTICLE
THE CLOSING
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1.1 Time, Date and Place of Closing. The payments and deliveries contemplated by
this Agreement to be made at the Closing shall be made concurrently with the
closing of the transactions contemplated by the Asset Acquisition Agreement of
even date herewith by and between The Coca-Cola Bottling Company of West
Virginia, Inc., Coca-Cola Bottling Company of Roanoke, Inc., and Enterprises
(the "Concurrent Agreement"). The date on which the last of such payments and
deliveries occurs is hereinafter referred to as the "Closing Date," and the
events comprising such payments and deliveries are hereinafter collectively
referred to as the "Closing." The effective time of the Closing shall be at
11:59 p.m., Pikeville, Kentucky time, on September 29, 2000.
1.1 Events Comprising the Closing. The Closing shall not be deemed to have
occurred unless and until the Franchise Purchase Price has been paid and all
other documents set forth herein have been delivered, and none of these items
shall have been deemed to be paid and delivered unless and until all of them
have been paid and delivered.
1.2
1.3 Conditions to Obligations of Enterprises. The obligations of Enterprises to
make the deliveries and payments under this Article VII and to close this
transaction are subject to the fulfillment prior to or at the Closing Date of
each of the following conditions, any one or more of which may be waived by
Enterprises:
1.4
(a) The representations and warranties contained in Article III hereof shall be
true in all material respects as of the date when made and as of the Closing
Date as if made on such date.
(b) Sellers shall have performed and complied in all material respects with all
agreements and conditions required by this Agreement to be performed or complied
with by them prior to or at the Closing Date.
(c)
13
(d) No Governmental Authority with competent jurisdiction over the subject
matter hereof shall have instituted any action, suit or proceeding or given
notice of its intentions to do so, which in the reasonable opinion of
Enterprises and its counsel has a material and adverse effect on the
transactions contemplated by this Agreement.
(e)
(f) Enterprises shall have received (1) commitments from The Coca-Cola Company
that it will consent to the transactions contemplated hereby and the assignment
of the Bottling Authorizations and the License Agreements and shall have
provided documentation with respect to the same reasonably satisfactory to
Enterprises, and (2) any other consents set forth on Disclosure Schedule 7.03(d)
hereto.
(g)
(h) Any governmental approvals legally required for the consummation of the
transaction that are set forth on Disclosure Schedule 7.03(e) shall have been
obtained, and all applicable waiting periods pursuant to the HSR Act shall have
expired or been terminated.
(i)
(j) All agreements, certificates and other documents delivered by Sellers to
Enterprises hereunder shall be in form and substance reasonably satisfactory to
Enterprises.
(k)
(l) Certified copies of the resolutions of the board of directors and the
shareholders (if required) of each Seller, and the Executive Committee of the
board of directors of Consolidated, authorizing the execution and delivery of
this Agreement and the consummation of the transactions herein contemplated
shall have been delivered to Enterprises.
(m)
(n) (h) The transactions contemplated by the Concurrent Agreement are
simultaneously consummated.
(o)
1.5 Conditions to Obligations of Sellers. The obligations of Sellers to make the
deliveries under this Article VII and to close this transaction are subject to
the fulfillment prior to or at the Closing Date of each of the following
conditions, any one or more of which may be waived by Sellers:
1.6
(a) The representations and warranties of Enterprises in Article IV hereof shall
be true in all material respects as of the date when made and as of the Closing
Date as if made on such date;
(b)
(c) Enterprises shall have performed and complied with in all material respects
all agreements and conditions required by this Agreement to be performed or
complied with by it prior to or at the Closing Date;
(d)
(e) No Governmental Authority with competent jurisdiction over the subject
matter hereof shall have instituted any action, suit or proceeding or given
notice of its intentions to do so, which in the reasonable opinion of Sellers
and their counsel has a material and adverse effect on the transactions
contemplated by this Agreement;
(f)
14
(g) The Coca-Cola Company shall have consented to the transactions contemplated
hereby and to the assignment of the Bottling Authorizations and the License
Agreements and shall have provided documentation with respect to the same
reasonably satisfactory to Sellers;
(h)
(i) All governmental approvals legally required for the consummation of the
transaction that have been set forth on Disclosure Schedule 7.03(e) shall have
been obtained, and all applicable waiting periods pursuant to the HSR Act shall
have expired or been terminated; and
(j)
(k) All agreements, certificates and other documents delivered by Enterprises to
Sellers hereunder shall be in form and substance reasonably satisfactory to
Sellers.
(l)
1.7 Deliveries by Sellers at the Closing. Delivery by Sellers of the following
at the Closing shall be a condition to the obligations of Enterprises under this
Agreement:
1.8
(a) A certificate dated the Closing Date executed by an officer of each Seller
certifying that (i) the representations and warranties of Sellers hereunder are
true and correct in all material respects on the Closing Date as if made on and
as of such date, (ii) the Sellers have performed and complied in all material
respects with all agreements, covenants, and conditions required by this
Agreement to be performed or complied with by it prior to or at the Closing, and
(iii) the applicable conditions precedent to the obligations of Sellers
hereunder have been fulfilled or waived;
(b)
(c) Opinion of counsel to Sellers, dated the Closing Date, in the form of
Exhibit 7.05(b);
(d)
(e) Certified copies of the resolutions of the board of directors and the
shareholders (if required) of each Seller, and the Executive Committee of the
board of directors of Consolidated, authorizing the execution and delivery of
this Agreement and the consummation of the transactions herein contemplated; and
(f)
(g) A bill of sale or similar assignment document in the form of Exhibit
7.05(d), executed by Sellers.
1.9 Deliveries by Enterprises at the Closing. Delivery by Enterprises of the
following at Closing shall be a condition to the obligations of Sellers under
this Agreement:
1.10
(a) A certificate dated the Closing Date executed by an officer of Enterprises
certifying that (i) the representations and warranties of Enterprises hereunder
are true and correct in all material respects on the Closing Date as if made on
and as of such date (ii) Enterprises has performed and complied in all material
respects with all agreements, covenants and conditions required by this
Agreement to be performed or complied with by it prior to or at the Closing, and
(iii) the applicable conditions precedent to the obligations of Enterprises
hereunder have been fulfilled or waived;
15
(b)
(c) Certified copies of the resolutions of the board of directors of Enterprises
authorizing the execution and delivery of this Agreement and the consummation of
the transactions herein contemplated;
(d)
(e) Opinion of counsel to Enterprises, dated the Closing Date, in the form of
Exhibit 7.06(c); and
(f)
(g) The Franchise Purchase Price in accordance with Section 2.01.
(h)
1 ARTICLE
TERMINATION AND ABANDONMENT
---------------------------
1.1 Termination and Abandonment. This Agreement may be terminated at any time
and the transaction abandoned at any time prior to the Closing under the
following circumstances:
(a) The mutual written agreement of Sellers and Enterprises.
(b)
(c) By Sellers if the Closing has not occurred before December 31, 2000 because
all conditions to Sellers' obligations have not been satisfied or waived or
because Enterprises has not made all required deliveries, unless the Closing has
not occurred solely because of a Governmental Objection.
(d)
(e) By Enterprises if the Closing has not occurred before December 31, 2000
because all conditions to Enterprises' obligations have not been satisfied or
waived or because Sellers have not made all required deliveries, unless the
Closing has not occurred solely because of a Governmental Objection.
(f)
(g) Any party may terminate by written notice to the others if any action or
proceeding shall have been instituted before any Governmental Authority or, to
the knowledge of the party giving such notice, shall have been threatened
formally in writing by any Governmental Authority with requisite jurisdiction,
to restrain or prohibit the transactions contemplated by this Agreement or to
subject one or more of the parties or their directors or their officers to
liability on the grounds that it or they have breached any law or regulation or
otherwise acted improperly in connection with such transactions (a "
Governmental Objection"), and such action or proceeding shall not have been
dismissed or such written threat shall not have been withdrawn or rescinded
before December 31, 2000.
(h)
1.2 Rights and Obligations on Termination. If this Agreement is terminated and
abandoned as provided in this Article VIII, each party will, at the request of
another, return all documents, work papers and other material of the requesting
party, including all copies thereof,
16
relating to the transactions contemplated by this Agreement, whether so obtained
before or after the execution of this Agreement, to the party furnishing the
same, and all information received by any party to this Agreement with respect
to the business of any other party shall not at any time be used for the
advantage of, or disclosed to third parties by, such party to the detriment of
the party furnishing such information except as may be required by Law;
provided, however, that this shall not apply to any document, work paper,
material, or any other information which is a matter published in any
publication for public distribution or filed as public information with any
Governmental Authority or is otherwise in the public domain.
1.3
1.4
2 ARTICLE
MISCELLANEOUS PROVISIONS
------------------------
1.1 Good Faith; Further Assurances; Further Cooperation. The parties to this
Agreement shall in good faith undertake to perform their obligations under this
Agreement, to satisfy all conditions and to cause the transactions contemplated
by this Agreement to be carried out promptly in accordance with the terms of
this Agreement. Upon the execution of this Agreement and thereafter, the parties
hereto shall do such things as may be reasonably requested by the other parties
hereto in order more effectively to consummate or document the transactions
contemplated by this Agreement.
1.1 Notices. All notices, communications and deliveries under this Agreement
shall be made in writing, signed by the party making the same, shall specify the
Section of this Agreement pursuant to which it is given, and shall be deemed
given on the date delivered if delivered in person (or by recognized overnight
courier) or seven days after being mailed (with postage prepaid) if mailed
certified mail, return receipt requested. Such notice shall not be effective
unless copies are provided contemporaneously as specified below, but neither the
manner nor the time of giving notice to those to whom copies are to be given
shall control the date notice is given or received. The addresses and
requirements for copies are as follows:
1.2
To Enterprises:
Mr. John R. Alm
President and Chief Operating Officer
Coca-Cola Enterprises Inc.
2500 Windy Ridge Parkway
Atlanta, Georgia 30339
[Post Office Box 723040]
[Atlanta, Georgia 31139-0040]
17
Notices to Enterprises shall be
accompanied by a copy to:
Mr. E. Liston Bishop III
Miller & Martin LLP
1000 Volunteer Building
832 Georgia Avenue
Chattanooga, Tennessee 37402-2289
* * * * * * *
To Sellers:
WVBC, Inc.
ROBC, Inc.
200 W. 9th Street
Wilmington, Delaware 19801
Attention: Norman Shuman
Notices to Sellers shall be
accompanied by a copy to:
Kennedy Covington Lobdell & Hickman LLP
Bank of America Corporate Center
Suite 4200
100 North Tryon Street
Charlotte, North Carolina 28202-4006
Attention: Sheila Wohl Chandonnet
or to such representative or to such other address as the parties hereto may
furnish to the other parties in writing. If notice is given pursuant to this
Section 9.02 of a permitted successor or assign of a party to this Agreement,
then notice shall be given as set forth above to such successor or assign of
such party.
1.1 Definition of Knowledge. As used in this Agreement, the term "to the
knowledge of Sellers" or any variations thereof shall mean the state of facts,
conditions or circumstances which is known or reasonably should have been known
to any director or officer of either Seller or to Christian J. Dominik.
1.2
1.3 Assignment. This Agreement shall be binding upon and shall inure to the
benefit of the parties hereto, and their respective legal representatives,
heirs, successors and assigns. No assignment or transfer of rights and
obligations hereunder shall be made except with the prior written consent of the
parties hereto, except that Enterprises need not obtain Sellers' consent to
Enterprises' assignment of rights and delegation of obligations under this
Agreement to an
18
affiliated corporation of Enterprises (which, for purposes of this Agreement,
shall be limited to any of Enterprises' wholly owned subsidiaries) provided that
such subsidiary or affiliate expressly assumes such liabilities and obligations
and that Enterprises remains fully liable for its obligations hereunder.
1.4
1.5 Captions; Definitions. The titles or captions of articles, sections and
subsections contained in this Agreement are inserted only as a matter of
convenience and for reference and in no way define, limit, extend or describe
the scope of this Agreement or the intent of any provision hereof and shall not
be considered in the interpretation or construction of this Agreement in any
proceeding. The parties agree to all definitions in the statement of parties to
this Agreement and in the other introductory language to this Agreement.
1.6
1.7 Controlling Law; Amendment; Waiver. This Agreement shall be construed in
accordance with and governed by the Laws of the State of Delaware, without
giving effect to the principles of conflicts of law thereof. No provision of
this Agreement or any related document shall be construed against or interpreted
to the disadvantage of any party hereto by any court or other governmental or
judicial authority by reason of such party's having or being deemed to have
structured or drafted such provision. This Agreement may not be altered or
amended except in writing signed by Enterprises and Sellers. The failure of any
party hereto at any time to require performance of any provisions hereof shall
in no manner affect the right to enforce the same. No waiver by any party hereto
of any condition, or of the breach of any term, provision, warranty,
representation, agreement or covenant contained in this Agreement, whether by
conduct or otherwise, in any one or more instances shall be deemed or construed
as a further or continuing waiver of any such condition or breach or a waiver of
any other condition or of the breach of any other term, provision, warranty,
representation, agreement or covenant herein contained.
1.8
1.9 No Third-Party Beneficiaries. With the exception of the parties to this
Agreement and each of their legal representatives, heirs, successors and
permitted assigns, there shall exist no right of any person to claim a
beneficial interest in this Agreement or any rights arising by virtue of this
Agreement.
1.10
1.11 Exhibits; Disclosure Schedule. All exhibits and the Disclosure Schedules
to this Agreement are hereby incorporated into and made a part of this Agreement
as if set out in full in the first place that reference is made thereto.
1.12
1.13 Counterparts; Entire Agreement. This Agreement may be executed by each
party upon a separate copy, and in such case one counterpart of this Agreement
shall consist of enough of such copies to reflect the signatures of all of the
parties to this Agreement. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, and it shall not be
necessary in making proof of this Agreement or the terms of this Agreement to
produce or account for more than one of such counterparts. This Agreement
together with all Disclosure Schedules and exhibits hereto, the Concurrent
Agreement and all other agreements and undertakings provided for hereunder shall
constitute the entire agreement of the parties and
19
supersedes any and all prior agreements, oral or written, with respect to the
subject matter contained herein. There are no other agreements, representations,
warranties or other understandings between the parties in connection with this
transaction which are not set forth in this Agreement or the Disclosure
Schedules and exhibits hereto.
1.14
1.15 Non-disclosure of Terms.
1.16
1.17 (a) Neither party, nor their affiliates may at any time prior to, on or
after the Closing Date, without the prior written approval of the other parties
hereto, which shall not be unreasonably withheld, disclose the Franchise
Purchase Price or any other economic term of this Agreement or the transactions
contemplated hereby to any third party, or issue any press release or make any
announcement relating to the subject matter of this Agreement or the
transactions contemplated hereby, other than as required by Law, including but
not limited to the Securities Act of 1933, as amended, other state or federal
securities Laws or in connection with compliance with the HSR Act.
1.18
1.19 (b) In the event that either party is ordered to make a disclosure by
virtue of a subpoena, civil investigative or discovery demand, criminal
investigative demand or similar order lawfully issued by a court of competent
jurisdiction, then such party shall promptly notify the other parties hereto and
cooperate with such parties to quash or otherwise limit the scope of such
disclosure.
1.20 9.11 Consent. Sellers hereby consent to the transactions contemplated by
the Concurrent Agreement.
1.21
[SIGNATURE PAGE FOLLOWS]
20
DULY EXECUTED by the parties hereto, under seal, as of the
date first above written.
WVBC, INC.
By: ____________________________________
Title: __________________________________
ROBC, INC.
By: ___________________________________
Title: _________________________________
COCA-COLA ENTERPRISES INC.
By:________________________________
Title:_______________________________