Exhibit 2
EBS/CFS
/
XXXXXXXXX & COMPANY, INCORPORATED
STOCK PURCHASE AGREEMENT
DUCROS
SODIS
July 12, 2000
STOCK PURCHASE AGREEMENT
BETWEEN
XXXXXXXX XXXXXX-SAY, a French joint-stock company with a share capital of [EURO]
259,834,460, having its registered office at rue Beghin 59239, Thumeries,
registered with the Registry of Commerce and Companies of Lille under the number
B 000 000 000,
Represented by Xx. Xxxxxxx Xxxxxx, its CEO,
Hereinafter "EBS"
COMPAGNIE FRANCAISE DE SUCRERIE - CFS, a French joint-stock company with a share
capital of FRF 1,871,590, having its registered office at rue Beghin 59239,
Thumeries, registered with the Registry of Commerce and Companies of Lille under
the number B 383 806 023,
Represented by Xx. Xxxxxx Xxxxx, duly empowered for this purpose,
Hereinafter "CFS"
Hereinafter collectively referred to as "THE SELLERS",
Acting jointly and severally
ON THE ONE HAND
AND
XXXXXXXXX & COMPANY, INCORPORATED, a company organized and existing under the
laws of the State of Maryland (United States of America), having its registered
office at 00 Xxxxxxx Xxxxxx, Xxxxxx, XX 00000-0000 (USA),
or any company that XxXxxxxxx & Company, Incorporated may substitute for itself,
and in which it holds a direct or indirect equity stake equal to 100%, and whom
XxXxxxxxx & Company, Incorporated guarantees, jointly and severally,
Represented by Xx. Xxxxxx X.Xxxxxxx, Chairman, President and Chief Executive
Officer and Xx. Xxxxxx X. Xxxxx Xx., Vice President - Acquisitions & Financial
Planning,
Hereinafter referred to as "THE BUYER",
ON THE OTHER HAND
WITNESSETH:
1 - CFS, whose sole shareholder is EBS, is a holding company which holds
shares representing 99.99% of the capital of the company Ducros, a French
joint-stock company ("SOCIETE ANONYME") with a share capital of FRF
103,831,488, divided into 2,884,208 shares with a par value of FRF 36,
having its registered office at X.X. Xxxxxxxxx, 00000 Carpentras,
registered with the Registry of Commerce and Companies of Carpentras
under the number B 622 980 027 ("Ducros").
Ducros is currently involved in the import, export, production, packaging
and marketing activities of peppers, herbs and spices.
Ducros holds equity interests in a number of different companies, which
it may or may not Control and which are primarily involved either in the
same field as Ducros or else in the manufacturing and marketing of
Dessert Aids. Details of these equity interests, are given in EXHIBIT
1(a). for the percentage stake in the company capital given in EXHIBIT
1(a).
2 - EBS for its part holds 99.99% of the capital of the company Sodis, a
French simplified joint-stock company ("societe par actions simplifiee")
with a share capital of FRF 300,000 divided into 3,000 shares with a par
value of FRF 100, having its registered office at Xxxxxxxx xx xx Xxxx,
00000 Xxxxxxx, registered with the Registry of Commerce and Companies of
Carpentras under the number B 329 926 471 ("Sodis").
Sodis is a holding company whose Subsidiaries are involved in rack
jobbing in supermarkets and hypermarkets and the running of a warehouse
situated at Gennevilliers.
The list of Sodis Subsidiaries is set forth in EXHIBIT 1(b) for the
percentage stake in the company capital given in EXHIBIT 1(b).
The Sellers have declared their intention to transfer the shares and the Buyer
has decided to purchase the shares representing the capital of Ducros and Sodis
under the terms and conditions set out in this Agreement.
WHEREBY IT IS AGREED AS FOLLOWS
ARTICLE 1 - DEFINITIONS
Unless defined otherwise in the present Contract, the terms set out herein
below, where these terms appear in the text with an initial capital, shall have
the following meanings:
"1999 PROFORMA CONSOLIDATED Shall mean the proforma consolidated
BALANCE SHEET FOR THE DUCROS GROUP" balance sheet and the statutory
auditor's opinion report for the Ducros
Group as at December 31, 1999, as
contained in APPENDIX 1(d)(1) hereto,
prepared on the basis of the
consolidated balance sheet as contained
in the 1999 Consolidated Accounts for
the Ducros Group and as completed by the
balance sheets for Malile and Semap as
at December 31, 1999, and after taking
into account the necessary accounting
entries for the purposes of
consolidation (ECRITURES DE
CONSOLIDATION), all prepared in
accordance with French GAAP.
"1999 CONSOLIDATED ACCOUNTS Shall mean the consolidated accounts for
THE DUCROS GROUP" the Ducros for Group as at December 31,
1999, prepared in accordance with French
GAAP, and the statutory auditor's
certification report both contained in
APPENDIX 1(e) hereto.
"1999 CONSOLIDATED ACCOUNTS FOR Shall mean the consolidated accounts the
FOR THE SODIS GROUP" Sodis Group as at December 31, 1999,
prepared in accordance with French GAAP,
and the statutory auditor's
certification report as contained in
APPENDIX 1(f) hereto.
"ACCOUNTING FIRM" Shall mean the accounting firm (CABINET
D'EXPERT COMPTABLE) Xxxxxx Xxxxxxxx or,
if this firm is not available, any other
accounting firm appointed in accordance
with the provisions of Article 3.4 (3.3
in French version).
"CLOSING DATE CONSOLIDATED Shall mean the consolidated balance
BALANCE SHEET FOR THE DUCROS GROUP" sheet for the Ducros Group, at the
Closing Date, all prepared in accordance
with French GAAP.
"CLOSING DATE CONSOLIDATED Shall mean the consolidated balance
BALANCE SHEET FOR THE SODIS GROUP" sheet for the Sodis Group as at the
Closing Date, all prepared in accordance
with French GAAP.
"EBIT" Shall mean the amount of the
consolidated net income ("RESULTAT NET
PART DU GROUPE") for the group formed by
the Ducros Group and the Sodis Group
plus the net result of the financial
products and expenses, corporate income
tax and the exceptional item relating to
Dessert Products International and
indicated as FRF 24.300.000 for the year
2000, less 49% of the net amount of
interest expense of Dessert Products
International, 49% of the corporate
income tax for Dessert Products
International and 49% of the exceptional
item relating to Dessert Products
International as above. This definition
is illustrated by an example given in
APPENDIX 1(c)(1).
"PROJECTED EBIT" Shall mean the aggregate projected EBIT,
from one month to the next, in respect
of fiscal year 2000, as contained in
APPENDIX 1(c)(2) hereto, for the group
formed by the Ducros Group and the Sodis
Group calculated without taking into
account the exceptional charges related
to Dessert Products International and
indicated as FRF 24,300,000 for the year
2000. The calculation of the period of
Projected EBIT will be from January 1,
2000 up to and including the Closing
Date. If the Closing Date does not fall
on an accounting month end, then the
amounts for the period between the end
of the previous month and the Closing
Date will be calculated by a simple
extrapolation prorata temporis of
figures for the month during which the
Closing Date falls.
"ACTUAL EBIT" Shall mean the consolidated EBIT for the
group formed by the Ducros Group and the
Sodis Group, for the period between
January 1, 2000 up to and including the
Closing Date, calculated without taking
into account either (i) the exceptional
charges related to Desert Products
International indicated as FRF
24,300,000 for the year 2000, or (ii)
any one off items of a non recurring
nature which should have resulted in an
adjustment under French GAAP in the (i)
1999 Consolidated Accounts for the
Ducros Group or (ii) in the 1999
Consolidated Accounts for the Sodis
Group or (iii) the certified financial
statements for Malile for financial year
1999.
The Actual EBIT will be adjusted as
necessary to take into account the
provisions of Article 3.3.
"AGGREGATE CONSOLIDATED NET Shall mean the sum total of the
POSITION" consolidated net equity (CAPITAUX
PROPRES) for the group formed by the
Ducros Group and the Sodis Group as at
the Closing Date .
"PRO-FORMA NET POSITION FOR THE Shall mean 82,272,000 Euros, plus:
DUCROS GROUP"
o the consolidated net results for the
Ducros Group in respect of the period
from January 1, 2000 up to and
including the Closing Date,
o the amount of all Taxes, except for
VAT, recorded on the books between
January 1, 2000 and the Closing Date
which do not arise out of the normal
and usual activities of the Ducros
Group for such period, it being
specified that asset sales carried out
in the ordinary course of business are
considered to be normal and usual
activities.
"PRO-FORMA NET POSITION FOR THE Shall mean 50,000 Euros plus:
SODIS GROUP"
o the consolidated net results for the
Sodis Group, in respect of the period
from January 1, 2000 up to and
including the Closing Date,
o the amount of all Taxes, except for
VAT, recorded on the books between
January 1, 2000 and the Closing Date
which do not arise out of the normal
and usual activities of the Sodis
Group for such period, it being
specified that asset sales carried out
in the ordinary course of business are
considered to be normal and usual
activities.
"DESSERT AIDS" Shall mean the items used in the
preparation of pastries, sugars, yeasts
and cake-mixes, as well as dessert
decoration items.
"TO THE SELLERS' KNOWLEDGE" Shall mean that the Sellers have made
careful enquiries at the level of the
Companies as to the accuracy of each
representation or warranty and the
Sellers shall be deemed to have
knowledge of any matter of which they
would have been aware if they had made
such enquiry.
"GAAP" Shall mean the generally accepted
accounting principles in the country of
the concerned company, as consistently
applied by that company.
"ACTIVITIES" Shall mean the production, processing,
packaging, manufacturing, trading, sale
and distribution by the Companies of the
Products.
"AFFILIATE" OR "AFFILIATES" A company is said to be affiliated to
another legal person when, either
directly or indirectly through one or
more intermediaries, such company
Controls or is Controlled by such legal
person, or is subject to common Control
with such legal person.
"AGREEMENT" Shall mean the present Agreement and all
its EXHIBITS.
"AUTHORISATION" OR Shall mean any permit, authorisation,
"AUTHORISATIONS" licence, certificate or sanction issued
to the Companies by an administrative
authority in any of the countries in
which the Companies conduct their
Activities.
"BASE SALES PRICE" Shall mean the amounts indicated in
Article 3.1 for the sale, as the case
may be, of Ducros Shares or Sodis
Shares.
"BUSINESS DAY" OR "BUSINESS DAYS" Shall mean any day other than a
Saturday, a Sunday or a public holiday
in France, with the exception of any day
during which the banks in France are not
open for financial transfers.
"CLOSING" Shall mean the consummation of the
contemplated transaction provided for by
the Agreement.
"CLOSING DATE" Shall have the meaning indicated under
Article 5 of the Agreement.
"COMPANIES" Shall mean collectively Ducros and the
Ducros Subsidiaries, Sodis and the Sodis
Subsidiaries.
"CONDITIONS PRECEDENT" Shall mean the conditions as set forth
in Article 10 of the Agreement.
"CONTROL" Shall mean control as defined by Article
355-1 of the Act of 24 July 1966; or is,
the empowerment of a person to manage a
company or to determine the policies of
that company based on the possession of
shares with voting rights, agreements or
any other instrument, the verb Control
when it is used should be understood to
mean under the Control.
"DESSERTS PRODUCTS Shall mean the company Desserts Products
INTERNATIONAL" International, a French simplified
joint-stock company ("societe par
actions simplifiee) with share capital
of FRF 163,516,000, having its
registered office at Xxxx Xxxxxxxxxxxx
Xxxxxxxxx, 00000 Xxxxxxx, registered
with the Register of Commerce and
Companies of Carpentras under the number
B 409 286 234.
"DUCROS GROUP" Shall mean Ducros and the Ducros
Subsidiaries collectively.
"DUCROS SHARES" Shall mean the 2,884,208 shares
representing the entire capital of
Ducros.
"DUCROS SUBSIDIARIES" Shall mean the Companies listed in
EXHIBIT 1(a).
"EXHIBIT" OR "EXHIBITS" Shall mean the documents attached to the
present Agreement and the Exhibits to
the Exhibits.
"FRF" AND "FRENCH FRANC(S)" Shall mean the French Franc and, after
its replacement by the Euro, its
equivalent value in Euros.
"HERO FRANCE" Shall mean the company Hero France, a
French joint-stock company (SOCIETE
ANONYME") with share capital of FRF
276,720,000, having its registered
office at Xxxx Xxxxxxxxxxxx, xxxxx xx
Xxxxxx, 00000 Allex, registered with the
Register of Commerce and Companies of
Die under the number B 347 681 074.
"INDEMNIFIABLE LOSS" OR
"INDEMNIFIABLE LOSSES" Shall mean the loss or losses provided
for by Article 9.
"INDEMNITY" Shall mean the amount of
indemnification, if any, owed to the
Buyer by the Sellers in application of
Article 9 of this Agreement.
"INTELLECTUAL PROPERTY RIGHT" OR Shall mean the trademarks, patents,
"INTELLECTUAL PROPERTY RIGHTS" designs, models, copyrights, and all
filings of trademarks, patents, etc.,
and all trade names or registered
business names, know-how and processes.
"LAWS" Shall mean, for each company, all the
legislation or regulations in force on
the date the Contract is signed that are
applicable to it enacted by any
government or administrative authority.
"KEY EMPLOYEES" Shall mean the employees listed in
EXHIBIT 8.A.7.2.1. of EXHIBIT 8.A. and
listed in EXHIBIT 8.B.7.2.1. of EXHIBIT
8.B.
"THIRD PARTY OFFER" Shall have the definition given in
Article 7.3(b).
"PLAN" Shall have the definition given in
Article 7.10 of EXHIBITS 8.A. and 8.B.
"MALILE AND SEMAP" Shall mean collectively the subsidiary
and sub-subsidiary of Desserts Products
International since January 1, 2000,
namely:
(i) Malile, a joint-stock company with
share capital of FRF 2,000,000,
having its registered office at 00
xxx xx Xxxxxxxxx, 00000 Xxxxxx,
registered with the Register of
Commerce and Companies of Creteil
under the number B 650 026 485, and
merged into Dessert Products
International by decision of the
Extraordinary Shareholders' meeting
on May 5, 2000.
(ii) Societe d'Exploitation des Marques
d'Aides a la Patisserie-Semap, a
limited-liability sole
proprietorship with share capital
of FRF 50,000, having its
registered office at 00 xxx
x'Xxxxxxxxxx, 00000 Xxxxx,
registered with the Register of
Commerce and Companies of Paris
under the number B 404 464 976.
"LIENS" Shall mean, when referring to an asset
(including the Shares or any other
equity), any security, privilege,
attachment, charge, mortgage, collateral
or pledge, any rights, actions to obtain
possession, encumbrances, easements or
restrictions of any kind whatsoever, any
call or put options, promises of first
refusal or other rights of third parties
(including any usufruct, joint
entitlement).
"MOVABLE PROPERTY" Shall mean any equipment, machines,
containers, cars, lorries, installations
or any other movable property used by
the Companies to conduct their business.
"MUL" Shall mean the Company M & J Mul & Cie,
a simplified partnership with a share
capital of FRF 152.000 and with its
registered office at Xxxxxxxx xx
Xxxxxxx, 00000 Xxxxxxx, registered at
the Register of Commerce and Companies
of Grasse under the number B 417.250.396
and 49.93% of which is held by Ducros
and concerning which the definition "to
the Sellers' Knowledge" takes into
consideration the fact that the Sellers
do not Control the operation of the
Company as they have a minority
shareholding.
"PARTY" OR "PARTIES" Shall mean the Sellers(s) and/or the
Buyer, as applicable.
"SALES PRICE" Shall mean the amount of the Base Sales
Price of the Ducros Shares and of the
Sodis Shares, adjusted, as the case may
be, pursuant to the provisions of
Article 3.2.
"RELATED AGREEMENTS" Shall mean any agreements or conventions
to be signed in the Approved Terms
pursuant to Article 4 of the Agreement.
"SHARES" Shall mean the Ducros Shares and the
Sodis Shares.
"SODIS GROUP " Shall mean Sodis and the Sodis
Subsidiaries collectively.
"PRODUCTS" Shall mean peppers, herbs, spices, dry
seasonings and dry sauce mixes and
Dessert Aids.
"SODIS SHARES" Shall mean the 3,000 shares representing
the entire capital of Sodis.
"SODIS SUBSIDIARIES" Shall mean the Companies listed in
EXHIBIT 1(b).
"SUBSIDIARY" Shall mean collectively or individually,
OR "SUBSIDIARIES" as the case may be, legal entities over
which Ducros and Sodis have either
direct or indirect Control, as listed
respectively in EXHIBIT 1(a) and EXHIBIT
1(b).
"TAX" Shall mean all forms of direct or
indirect, national or local, past or
present or deferred (which term covers
in particular, but without limitation, A
SURSIS, A REPORT OR AN EXONERATION
CONDITIONNELLE), taxation, including,
without limitation, gross income, net
income, value added, real and personal
property, business, sales, transfer,
profits, withholding, payroll, excise,
severance or occupation taxes,
compulsory social security charges,
stamp or registration duties, customs
and other import or export duties,
together with any late interest,
penalties, charges, costs and expenses
payable in connection with Tax
(including, without limitation, all
reasonably incurred legal, accounting
and other professional fees and
disbursements, as well as any costs
incurred in connection with guarantees
needed for the postponement of a payment
of Tax), or any additional amounts
(including profit-sharing payments),
imposed under a Tax Legislation enacted
or administered by any Tax Authority.
"TAX AUTHORITY" Shall mean, in relation to any country,
the government of that country and any
ministry, department, political
subdivision, instrumentality, agency,
corporation or commission under the
direct or indirect control of such
government and responsible for a Tax.
"TAX COVENANT AND DEED OF TAX
INDEMNITY": Shall mean the agreement attached as
EXHIBIT 4.10.
"AGREEMENT FOR A DEPARTURE Shall mean the agreement attached as
FROM THE TAX CONSOLIDATED EXHIBIT 4.5.
GROUP"
"TAX LEGISLATION" Shall mean any federal, state, local,
municipal, foreign, international or
multinational treaty, statute, law,
constitution, court decision, decree,
order, regulation, ordinance or rule
with respect to a Tax.
"IN THE APPROVED TERMS" Shall mean, with reference to a
document, that the terms of this
document have been agreed by each of the
Parties hereto.
ARTICLE 2 - PURCHASE AND SALE OF SHARES - TRANSFER OF OWNERSHIP
2.1. TRANSFER OF THE DUCROS SHARES
CFS hereby irrevocably undertakes to transfer herein, under the terms
and conditions set out hereinafter, and subject to the Conditions
Precedent, the Ducros Shares to the Buyer, who irrevocably undertakes,
under the terms and conditions set out hereinafter and subject to the
Conditions Precedent, to purchase the Shares, free from any Liens and
accompanied by any rights present or future, for the Sales Price for
the Ducros Shares.
Upon transfer of the Ducros Shares, the Buyer shall own 100% (one
hundred percent) of the capital of Ducros.
2.2. TRANSFER OF THE SODIS SHARES
EBS hereby irrevocably undertakes to transfer herein, under the terms
and conditions set out hereinafter, and subject to the Conditions
Precedent, the Sodis Shares to the Buyer, who irrevocably undertakes,
under the terms and conditions set out hereinafter, and subject to the
Conditions Precedent, to purchase the Shares, free from any Liens and
accompanied by any rights present or future, for the Sales Price for
the Sodis Shares.
Upon transfer of the Sodis Shares, the Buyer shall own 100% (one
hundred percent) of the capital of Sodis.
2.3. ACQUISITION OF CERTAIN SHARES OR EQUITY BY THE SELLERS, DUCROS OR SODIS
It is agreed that CFS irrevocably undertakes to acquire, prior to the
Closing Date, the Ducros Shares, free from any Liens, to which shall be
attached any rights present or future belonging to individuals or
companies on the date of this Agreement. Details of these, including
the percentage stake in the company capital, are given in EXHIBIT 2.3
(i);
2.4. TRANSFER OF OWNERSHIP
The transfer of title in and to the Shares shall occur on the Closing
Date. The Buyer shall have full right, title and interest in and to the
Shares, and the voting rights attached to the
Shares, without any restrictions of any type whatsoever, as of the
Closing Date free and clear of any Liens.
ARTICLE 3 - SALES PRICE
The Sales Prices for the Ducros Shares and the Sodis Shares that the Buyer
hereby agrees to pay to the Sellers on the Closing Date shall be equal
respectively to (i) the Base Sales Price for the Ducros Shares specified below
in Article 3.1.1., as adjusted (where applicable) in accordance with the terms
and conditions set out below in Article 3.2.2, and, as the case may be,
increased in accordance with Article 3.2.3, and (ii) the Base Sales Price for
the Sodis Shares specified below in Article 3.1.2.
3.1 BASE SALES PRICE
3.1.1 BASE SALES PRICE FOR THE DUCROS SHARES
The Base Sales Price for the Ducros Shares shall be Two Billion Four
Hundred and Fifty Million French Francs (FRF 2,450,000,000).
3.1.2 BASE SALES PRICE FOR THE SODIS SHARES
The Base Sales Price for the Sodis Shares shall be Three Hundred
Million French Francs (FRF 300,000,000).
3.2 ADJUSTMENT OF THE BASE SALES PRICE FOR THE DUCROS SHARES
3.2.1 The Base Sales Price for the Ducros Shares has been determined on the
basis of the following principles:
a) the Aggregated Consolidated Net Position shall be equal to at least the
aggregation of the amounts of the Proforma Net Position for the Ducros
Group and the Proforma Net Position for Sodis Group;
b) the Actual EBIT shall be equal to at least the amount of the Projected
EBIT, in respect of the period from January 1, 2000 up to and including
the Closing Date.
3.2.2 ADJUSTMENT OF THE BASE SALES PRICE FOR THE DUCROS SHARES ON THE BASIS F
THE VARIATION IN THE NET POSITIONS, THE EBIT AND THE ONE OFF ITEMS OF A
NON-RECURRING NATURE:
The Base Sales Price for the Ducros Shares specified above in Article 3.1.1
shall be reduced accordingly (where applicable) so that it shall duly reflect:
(a) the negative difference resulting from the following operation: (the
Aggregate Consolidated Net Position) minus (the aggregate amount of the
Proforma Net Position of the Ducros Group and the Proforma Net Position
of the Sodis Group).
This negative difference shall give rise to a reduction in the Base
Sales Price for the Ducros Shares equal (on a Franc for Franc basis) to
the amount of such negative difference, payable in accordance with the
terms and conditions of Article 3.5.2.
(b) the negative difference resulting from the following operation: (amount
of the Actual EBIT) minus (amount of the Projected EBIT).
This negative difference shall give rise to a reduction in the Base
Sales Price for the Ducros Shares, payable in accordance with the terms
and conditions of Article 3.5.2. equal to:
(i) a multiple of ten (10) times the amount of said negative
difference, if the Closing Date occurs before August 1, 2000;
(ii) a multiple of nine (9) times the amount of said negative
difference, if the Closing Date occurs between August 1, and
on or prior to August 31, 2000;
(iii) a multiple of eight (8) times the amount of said negative
difference, if the Closing Date occurs between September 1,
2000 and on or prior to September 30, 2000;
(iv) a multiple of six (6) times the amount of said negative
difference, if the Closing Date occurs on or after October 1,
2000.
(c) the amount which results from any one off items of a non-recurring
nature which would have resulted in an adjustment under French GAAP, of
(i) the 1999 Consolidated Accounts of the Ducros Group, or (ii) the
1999 Consolidated Accounts of the Sodis Group, or (iii) the audited
financial statements for fiscal year 1999 for Malile, which was
excluded from the calculation of the Actual EBIT for the purposes of
Article 3.2.2(b) above, shall give rise to a reduction, on a Franc for
Franc basis, of the Base Sales Price for the Ducros Shares payable in
accordance with the terms and conditions of Article 3.5.2.
3.2.3 The Base Sales Price for the Ducros Shares shall be increased by an
amount of Twenty-Three Million French Francs (FRF 23,000,000).
Said amount shall be payable to CFS in accordance with the provisions
set out below in Article 3.5.2.
3.3 INDICATIONS FOR CALCULATING THE ACTUAL EBIT
For the sole purpose of calculating the Actual EBIT:
a) All expenses charged by the Sellers or one of their Affiliates on the
one hand to one of the Companies on the other hand will be calculated
in conformity with prior practice. With regards to the amounts
appearing on the line entitled "EBS Fees" and "Logo" such
amounts charged to the Companies will not be less than 95% nor more
than 105% of the budgeted amounts set forth in EXHIBIT 1(c)2;
b) Transactions between the Sellers or one of their Affiliates on the one
hand and one of the Companies on the other hand which take place
between January 1, 2000 up to and including the Closing Date, or any
transactions entered into between such Companies or omitted during this
period, which would have the effect, either directly or indirectly, of
artificially increasing, including by acceleration, the revenues of the
Companies or artificially decreasing or deferring their expenditure for
this period (including but not limited to assumption of expenses
relating to the Companies Activities, releases of liabilities or asset
transfers, changes to terms of agreement between any of the Sellers or
their Affiliates and any of the Companies):
i) shall not be taken into account in case of an increase in
profit, including by acceleration; and
ii) shall be charged to the Companies in the case of a decrease or
deferral of expenditure,
it being agreed that (i) the "PRIME DE REMERCIEMENTS" for an
approximate amount of FRF 2,000,000 (including employers social
charges), specifically provided for in the "PROTOCOLE D'ACCORD DE
REPRISE DE TRAVAIL" dated June 21, 2000, shall be paid by EBS, and (ii)
no costs or charges shall be made to or borne by the Ducros Group or
the Sodis Group in connection with the sale contemplated by this
Agreement;
c) For the purposes of verification and validation by the Buyer of the
amounts charged to the Companies by the Sellers or any of their
Affiliates, the Sellers shall provide the Buyer with documents
justifying the calculations thereof and the Sellers will answer
reasonable questions asked by the Buyer on such calculations.
3.4 ADJUSTMENT PROCEDURE
In connection with the adjustment procedure (if any), the Sellers and the Buyer
hereby agree as follows:
a) The Aggregate Consolidated Net Position and the Actual EBIT shall be
determined in accordance with French GAAP. Ducros procedures may be
used in preparation of these amounts to the extent such procedures are
in conformity with French GAAP.
If the Sellers and the Buyer were to decide that, in order to determine
the Aggregate Consolidated Net Position and/or the Actual EBIT, it
would be necessary to carry out a physical stock take of one or all of
the Companies of the Ducros Group, both Sellers and Buyer shall
participate therein; each Party shall be represented by its auditors.
b) Within a period of ninety (90) Business Days from the Closing Date, the
Buyer shall notify the Sellers (i) the amount of the Aggregate
Consolidated Net Position, (ii) the
amount of the Actual EBIT, (iii) the amount determined pursuant to
Article 3.2.2 c) and (iv) the amount of the reduction in the price,
together with documentary evidence on said amounts.
During this 90 (ninety) day period, the Sellers and the Buyer shall
have to agree on the methods of calculation and the amount of Tax
provisions to be recorded in the accounting documents which are
necessary for the preparation or the calculation of the Closing Date
Consolidated Balance Sheets for Ducros, the Closing Date Consolidated
Balance Sheets for Sodis, the Aggregate Consolidated Net Position,the
Actual EBIT, and the amount determined pursuant to Article 3.2.2.c).
Such provisions must be recorded in the Closing Date Consolidated
Balance Sheet for the Ducros Group and the Closing Date Consolidated
Balance Sheet for the Sodis Group and shall be specific and itemized
per company of the Ducros Group and per company of the Sodis Group and
by type of Tax.. These details shall also be set out on a schedule
attached to the Consolidated Balance Sheets.
In the case of a disagreement between the Sellers and the Buyer, such
disagreement shall be settled by the Accounting Firm in accordance with
the provisions of Article 3.4. c) to g).
c). As part of the verification and validation of the amounts stated above
by the Sellers (and solely for this purpose), after their receipt, the
Buyer (i) shall provide the Sellers or their advisors, with any
necessary information or documents and (ii) shall allow the Sellers'
advisors, who shall be bound by a confidentiality obligation, to have
access to any person who was involved in their preparation, subject to
approval by the Buyer of the conditions of involvement, such approval
shall not be unreasonably withheld, and such involvement being
reasonable and not disruptive to the Companies' business. The Buyer
shall give them access to the working papers relating to the accounting
documents used to determine (i) the Aggregate Net Position, (ii) the
Actual EBIT, (iii) the one off items of a non-recurring nature which
would not have been taken into account for the purposes of calculating
the Actual EBIT and which would give rise to the price reduction
stipulated in Article 3.2.2 c) above, and (iv) the Closing Date
Consolidated Balance Sheet for the Ducros Group and the Closing Date
Consolidated Balance Sheet for the Sodis Group.
The Sellers shall notify the Buyer of their disagreement with one or
more of the above amount(s) within a period of thirty (30) Business
Days after the notice referred to above in Article 3.4 (b) above.
In this case, the Parties shall attempt to resolve their dispute within
a period of thirty (30) Business Days following the above notice from
the Sellers. Said notice from the Sellers must specify each proposed
modification and the reasons for such modification. Those issues that
are not in dispute shall be deemed to have been accepted jointly by the
Parties.
If the Parties are unable to reach an agreement within said period of
thirty (30) Business Days, the Parties will take their dispute before
the Accounting Firm. If this Accounting
Firm is unable to accept its mission, it will be replaced in the
following manner: the Parties shall jointly designate another
Accounting Firm of international renown within five (5) Business Days
from the refusal of the Accounting Firm. If the Parties are unable to
reach agreement within five (5) Business Days, the Accounting Firm
shall be appointed pursuant to an order rendered by the PRESIDENT DU
TRIBUNAL DE COMMERCE (Chief Judge of the Commercial Court) of Paris,
deciding in summary proceedings (REFERE), upon the petition filed by
the most diligent party.
d) The fees and expenses of the Accounting Firm shall be split 50-50
between the Sellers and the Buyer.
e) The assignment of the Accounting Firm shall be limited to the
resolution of those matters in dispute between the Parties. The
findings of the Accounting Firm shall be binding on the Parties, shall
be final and shall not be subject to appeal.
f) The Buyer and the Sellers hereby irrevocably agree (i) to provide the
Accounting Firm with access to any information, documents and persons
necessary for it to perform its assignment, and (ii) to respect
bilateral procedures (DU CONTRADICTOIRE) with regard to each other.
g) The Accounting Firm (i) must strictly comply with the rules on
independent and bilateral procedures (PRINCIPE DU CONTRADICTOIRE) with
regard to the Parties, (ii) shall be bound by the confidentiality
clause set out below in Article 11.5 (iii) shall file its report within
60 days of being designated.
h) It is agreed that a generating factor which has given rise to a price
reduction pursuant to anyone of Articles 3.2.2 a), or 3.2.2 b) or 3.2.2
c) shall not give rise to another price reduction under another of
these articles.
3.5 TERMS OF PAYMENT OF THE SALES PRICE
3.5.1 PAYMENT OF THE BASE SALES PRICES
On the Closing Date, the Buyer shall pay to the Sellers the Base Sales Prices
for the Ducros Shares and the Sodis Shares, by means of irrevocable wire
transfers (VIREMENTS BANCAIRES IRREVOCABLES) paid into the bank accounts for
which the particulars shall be notified by the Sellers to the Buyer no less than
five (5) Business Days prior to the Closing Date:
- a wire transfer of FRF 2.450.000.000 (Two Billion Four Hundred and
Fifty Million French Francs) as the payment of the Base Sales Price for
the Ducros Shares;
- a wire transfer of FRF 300,000,000 (Three Hundred Million French
Francs) as the payment of the Base Sales Price for the Sodis Shares.
3.5.2 TERMS OF PAYMENT OF THE ADJUSTMENT IN THE BASE SALES PRICE FOR THE
DUCROS SHARES
a) CFS hereby irrevocably agrees (where applicable) to reimburse the Buyer
for the amount of the reductions in the Base Sales Price calculated in
accordance with the provisions of Article 3.2.2 above, within a period
of fifteen (15) Business Days after (i) the agreement between CFS and
the Buyer as to the amounts of the Aggregate Consolidated Net Position,
the Actual EBIT and the amount determined pursuant to Article 3.2.2(c),
or (ii) the filing of the report of Accounting Firm on the amount of
the Aggregate Consolidated Net Position, the Actual EBIT, and on the
amount determined pursuant to Article 3.2.2(c). Any amounts owed to the
Buyer in accordance with the provisions of Article 3.2.2 above shall
bear interest on the basis of the EURIBOR monthly rate for the period
running from the Closing Date until the date of payment. If the EURIBOR
cease to be published, it shall be replaced as of right by the interest
rate that replaces it.
b) The amounts (if any) owed by CFS shall be set-off against the amount of
FRF 23,000,000 (Twenty-Three Million French Francs) owed by the Buyer
in accordance with the provisions of Article 3.2.3. This amount of FRF
23,000,000 (Twenty-Three Million French Francs) shall not be deemed to
be a ceiling for the adjustment of the Base Sales Price for the Ducros
Shares.
c) The Buyer hereby irrevocably agrees to pay to CFS the amount of FRF
23,000,000 (Twenty-Three Million French Francs), or any remaining sum
still owed after the set-off performed in accordance with the
provisions of Article 3.5.2. (b) above, within a period of fifteen (15)
Business Days after (i) the agreement between CFS and the Buyer as to
the amounts of the Aggregate Consolidated Net Position, the Actual EBIT
and the amount determined pursuant to Article 3.2.2(c) or (ii) the
filing of the report of Accounting Firm on the amount of the Aggregate
Consolidated Net Position, the Actual EBIT, and on the amount
determined pursuant to Article 3.2.2(c). Any amounts owed to CFS in
accordance with the provisions of Article 3.2.3 above shall bear
interest on the basis of the EURIBOR monthly rate for the period
running from the Closing Date until the date of payment. If the EURIBOR
ceases to be published, it shall be replaced as of right by the
interest rate which replaces it.
ARTICLE 4 - RELATED AGREEMENTS AND UNDERTAKINGS
Prior to the transfer of the Shares by the Sellers to the Buyer, the Sellers
irrevocably undertake to sign or have signed or to conclude or have concluded in
the Approved Terms the following agreements or undertakings, which are essential
conditions for the transfer of the Shares.
4.1. Not used.
4.2. Not used.
4.3. Assignment of ownership of the trademarks held by Ducros International
B.V. to Ducros, which are listed on EXHIBIT 4.3.
4.4. Letters informing the Sellers of the hiring of Xx. Xxxxxxx Xxxxxxx and
Xx. Xxxx Xxxxxxxx by one of the Buyer's Affiliates under the condition
precedent that the transaction, object of this Agreement, closes, and
their letters of resignation from their positions with EBS, with no
conditions other than the closing of the transaction which is the
object of this Agreement in the forms attached as EXHIBIT 4.4, or if
there are no such letters of hiring and letters of resignation, an
undertaking to take on the employment contracts of Xx. Xxxxxxx Xxxxxxx
and Xx. Xxxx Xxxxxxxx and the ancillary agreements to these work
contracts, also attached in EXHIBIT 4.4.
4.5 Agreement for a departure from the Tax Consolidation Group amongst
Ducros, EBS and the Buyer, in accordance with the agreement attached as
EXHIBIT 4.5.
4.6 Agreements related to the conditions for terminating the cash-pooling
agreement binding the Companies to EBS or to the Affiliates of EBS, in
accordance with the agreement attached as EXHIBIT 4.6, and for the
related reimbursements or payments to be completed by the amounts owed
by one or the other Parties.
4.7 Acceptance by the Buyer of the transfer to it or to any company
substituted for it, including Ducros, of undertakings by the Sellers or
their Affiliates of the letters of guarantee, security or comfort
granted by the Sellers or the Affiliates of the Sellers, copies of
which are attached as EXHIBIT 4.7 either by means of a full and final
release from the beneficiary in the form of a counter guarantee by the
Buyer in identical terms of the undertakings of the Sellers or the
Affiliates of the Sellers, in such a way that the Sellers or their
Affiliates are entirely released.
4.8 Agreements related to the conditions for terminating the license for
the use of the EBS logo, in accordance with the agreement attached as
EXHIBIT 4.8, to be completed by the amounts owed by one or the other
Parties.
4.9 Agreements related to the termination conditions of the service
contracts between the Sellers and the Companies whose list is set forth
in EXHIBIT 4.9 to be completed by the amounts owed by one or the other
of the Parties.
4.10 Tax Covenant and Deed of Tax Indemnity, attached as EXHIBIT 4.10.
ARTICLE 5 - COMPLETION OF THE TRANSFER - DOCUMENTS TO BE DELIVERED BY THE
SELLERS AND BY THE BUYER - INSURANCE
5.1. Closing Date
The closing of the Share transfer shall take place at the latest on the expiry
of a period of five (5) Business Days following the fulfillment of the last of
all the Conditions Precedent provided for under Article 10 or on any other date
as mutually agreed upon by the Parties and at the time set forth on the share
transfer certificates (the "CLOSING DATE").
The Closing shall take place during a meeting held in the offices of the law
firm C.L.&A (0, xxx Xxxxxxx 00000 Xxxxx) or at another place as mutually agreed
upon by the Parties.
5.2. DOCUMENTS TO BE DELIVERED BY THE SELLERS
The Sellers irrevocably undertake to deliver the following documents each in the
Approved Terms to the Buyer on the Closing Date, subject to the Buyer satisfying
the requirements of this Article 5.
5.2.1. Share transfer certificates to the Buyer duly completed and signed,
indicating the time of the Closing of the Transaction and pertaining to
all of the Shares.
5.2.2. Letters from the Sellers reiterating the representations and warranties
stipulated in Article 8 below in the form attached as EXHIBIT 5.2.2..
5.2.3. Tax documents necessary for the registration of the Share transfers in
the form attached as EXHIBIT 5.2.3..
5.2.4. Where applicable (i) share transfer registers, (ii) shareholder
registers, (iii) registers of the minutes from the Shareholders'
General Meetings and meetings of the Board of Directors of Ducros and
Sodis, all updated as of the date herein, it being stated that the
Registers ("Corporate books") of the French Companies shall be placed
at the Buyer's disposal at its first demand and the registers of
Companies with their registered office abroad will be available to be
Buyer at their registered office;
5.2.5. Letters of resignation of:
(a) the legal representatives ("MANDATAIRES SOCIAUX") of the Companies
listed in EXHIBIT 5.2.5 (i), and indicated therein as having resigned;
(b) the members of the Board of Directors of the Companies with appropriate
waivers of claims and release related to their position as a board
member also listed in EXHIBIT 5.2.5 (i).
5.2.6. Notice of an Ordinary General Meeting of the shareholders of Ducros to
take place on the Closing Date for the purpose of acknowledging the
resignations of the foregoing members of the Board of Directors with
release and appointing new members to the Board of Directors of Ducros.
5.2.7. Notice of an Ordinary General Meeting of the Shareholder of Sodis, to
take place on the Closing Date for the purpose of appointing a new
Chairman.
5.2.8. Minutes of the meeting of the Board of Directors of CFS authorizing the
transfer of the Shares to the Buyer.
5.2.9. Minutes of the meeting of the Board of Directors of Ducros approving
the Buyer as a new shareholder.
5.2.10. Minutes of the meetings (i) of the European Group-Level Workers Council
of EBS, (ii) of the Central Workers Council of EBS and (iii) the
Central Workers Council of Ducros, duly convened and held prior to the
signing of the Contract, pertaining to the transfer of the Shares to
the Buyer and outlining the opinion of the said workers councils.
5.2.11. The assignment agreements in which Xxxx Xxxxxxxx undertakes to sell to
Ducros the shares that he holds in the capital of Ducros SRL and in the
capital of Xxxxxx XX (Espagne) attached as EXHIBIT 5.2.11.
5.2.12. Amendments terminating agreements drawn up between (i) the Sellers and
the Companies and (ii) the Companies and the Affiliates of the Sellers
as listed in Article 4, in the form of the agreement attached thereto.
5.2.13. A receipt duly signed by each of the Sellers for the Base Sales Prices.
5.2.14. Undertakings to return the shares held by individuals duly signed by
them. The list of such individuals and their shareholdings is set forth
in EXHIBIT 5.2.14.
5.2.15. Non-compete undertaking from Montedison in the form attached as
EXHIBIT 5.2.15.
5.3. DELIVERY BY THE BUYER
The Buyer irrevocably undertakes to deliver the following items to the Sellers
during the Closing meeting subject to the Sellers duly satisfying the other
requirements of this Article 5.
5.3.1. The Base Sales Price pursuant to the provisions of Article 3.5.1.
5.3.2. The extract from the minutes of the meeting of the Board of Directors
of the Buyer authorising the acquisition of the Shares from the
Sellers.
5.3.3. Copies of the release, along with the corresponding original
undertakings or copies of the counter guarantees of the Buyer for the
letters of guarantee, or comfort replacing the letters of guarantee or
comfort issued by the Sellers or their Affiliates, copies of which are
attached as EXHIBIT 4.7.
5.4. DELIVERY BY THE SELLERS AND/OR THE BUYER
The Sellers and/or the Buyer, as the case may be, irrevocably undertake to
deliver during the Closing meeting:
(a) signed copies of the Related Agreements other than those mentioned in
Article 5.2.12.;
(b) the means of payment or evidence that such payments have been made,
corresponding to the reimbursement of the reciprocal financial debts
among the Sellers and their Affiliates and the Companies in order that
there is no financial debt between these companies.
5.5. INSURANCE
The Buyer shall subscribe to new insurance policies necessary for the operation
of the Companies from the Closing Date. The Companies' insurance policies listed
in EXHIBIT 5.5 being subscribed to within the framework of insurance policies of
the EBS Group, will automatically be terminated upon the Closing Date.
5.6. TRANSITIONAL SERVICES AGREEMENTS
The Buyer may ask the Sellers to supply it with transitional services agreements
from the list attached as Exhibit 5.6, under the terms and conditions negotiated
by the Parties in good faith.
5.7. DISTRIBUTION OF AGREEMENTS
The Parties shall negotiate in good faith and prior to the Closing Date the
terms and conditions of the continuation of the distribution agreements between
Ducros Distribution Benelux, the Affiliates of the Seller and the companies
Xxxxxxx and Carapelli Firenze SpA, it being understood that if no agreement is
reached, these agreements will be terminated without notice at Closing Date
pursuant to their article 2.
ARTICLE 6 - CONDUCT OF BUSINESS
Unless otherwise contemplated or permitted by this Agreement; between the date
of signature of the Contract and the Closing Date:
6.1 The Sellers shall use their best efforts to cause each of the Companies
(except for Mul) to:
(i) conduct its business and activities diligently in the ordinary
course of business consistent with past practice; and
(ii) not, without the prior written consent of the Buyer and such
consent shall not be unreasonably withheld, enter into any
transaction outside the ordinary course of business or
involving for each of the Companies a commitment or a sale of
assets for an amount in excess of five million (5,000,000)
French Francs, or for an amount in excess of twelve million
(12,000,000) French Francs with respect to (i) purchase orders
for peppers and almonds, (ii) currency transactions related to
the
foregoing purchases, and (iii) intra groups transactions
within EBS pursuant to the contracts attached hereto.
To this effect, the Sellers shall use their best efforts to
and shall cause each of the Companies to, not without the
prior written consent of the Buyer and such consent shall not
be unreasonably withheld, change their respective present
management, including the Key Employees, and to not materially
change their business and administrative organization and
their relations with their customers and suppliers.
The Sellers (i) shall not and shall cause each of the
Companies (except for Mul) to not take any action outside of
the ordinary course of business of the Companies which would
render the representations and warranties provided in EXHIBIT
8.A. and EXHIBIT 8.B. inexact at the Closing Date, except with
the prior written consent of the Buyer, which shall not be
unreasonably withheld; and (ii) will not grant, assign and
shall cause each of the Companies to not grant or assign any
right or Lien over the Intellectual Property Rights to third
parties.
6.2. The Sellers shall not conclude any agreement, obligation or contract
limiting or restricting its right to transfer the Shares or modifying
the number of shares of the Companies, except those related to the
current increase in the share capital of Ducros Polska.
6.3 The Sellers will provide monthly management accounts ("REPORTING") to
be delivered within thirty (30) days of the end of the relevant month
or at such earlier time as they are available.
ARTICLE 7 - NON-COMPETITION CLAUSE
7.1. The Sellers shall and shall procure that the subsidiaries over which
they have Control shall irrevocably refrain from the Closing Date from
carrying out in any of the countries as listed in Article 7.2 below,
either directly or indirectly, the Activities or any other activity
that competes with the Activities.
7.2. The present non-competition clause shall be valid for 4 (four) years
from the Closing Date and shall be limited to the Member States of the
European Union, the overseas departments and territories of France and
those countries in which at the date of this Agreement the Products are
produced, marketed or distributed by the Companies in a
"non-occasional" manner.
This non-competition clause shall not apply to sugar, sugar
derivatives, and edible products made primarily from sugar, or
non-edible products made from sugar, or any products that can be
substituted in whole or in part for sugar processed, packaged,
manufactured, marketed, traded or distributed by EBS and/or by its
Affiliated Companies.
For the purposes of this Article, the term "SUGAR DERIVATIVES" shall
not include the type of products made and marketed under the trademarks
"VAHINE" and "MALILE" at the date of signature of this Agreement, by
the Ducros Group except for (i) flavored sugar that EBS and / or its
Affiliates reserve the right to manufacture and market in packaging and
under presentation which is not that habitually used by Vahine and
Malile at the date of signature of the Contract and, (ii) the products
manufactured and marketed by the Sellers and their Subsidiaries (other
than the Ducros Group) at the date of signature of the Agreement.
7.3. a) In the event that, during such four (4) year period, in
connection with a transaction concerning an acquisition of a
company or a joint-venture involving mainly an activity other
than the Activities, the Sellers would take Control of a
company carrying out, directly or through the intermediary of
an Affiliate, an activity competing with the Activities, the
Sellers shall use their best efforts to sell the business
activity that competes with the Activities within a period of
one (1) year from the effective date of the acquisition under
the terms and conditions of Article 7.3 b) and c) below. In
the event that the Sellers are unable to sell said competing
business activities within the period specified above, the
Sellers irrevocably undertake to take the measures necessary
to ensure that they shall not exercise any Control that they
may hold, and that they shall not directly manage such
competing business activities.
b) (i) The Sellers agree to place up the competing business
activities for sale immediately after the effective
date of acquisition thereof.
(ii) Prior to the sale of the competing business
activities pursuant to a serious offer from a third
party (the "THIRD PARTY OFFER"), the Sellers must
give notice of said offer to the Buyer. The notice
must contain a written copy of the Third Party Offer
that sets out the essential terms and conditions
thereof, the sale price, the method of payment and
the proposed consummation date, and ((beta)) evidence
that the third party in question has the proven
capacity (from both a financial and legal standpoint)
to consummate the transaction.
(iii) The Buyer shall have a period of thirty (30) days
after the date of receipt of the notice either to
accept or to reject the sale, in accordance with the
same terms and conditions as those of the Third Party
Offer. In the event that the Buyer accepts the sale,
such sale must be consummated by the date proposed in
the Third Party Offer or at another date agreed upon
by the Sellers and the Buyer.
(iv) Upon the expiration of said period of thirty (30)
days or upon the receipt of the Buyer's refusal to
purchase prior to said period, the Sellers shall then
have the right to sell such business activity, but
only under terms and conditions which will not be
more favorable to the third party than those
contained in the Third Party Offer.
(v) In the event that the Sellers do not receive any
serious offer from a third party within a period of
six (6) months after the effective date of
acquisition of the competing business activities, the
provisions of Article 7.3 c) below shall apply.
c) (i) Within a period of two (2) months from the expiration
of the period of six (6) months referred to above in
Article 7.3 b)(v), the Sellers shall offer the
competing business activity to the Buyer to be
purchased at a price to be established by the Sellers
on the basis of the market value.
Within a period of thirty (30) days after the date of
the Buyer's receipt of the offer thus transmitted by
the Sellers, the Parties shall meet and negotiate in
good faith the sales price, and the other terms of
the sale for the purpose of determining whether an
agreement can be reached in respect of the Buyer's
acquisition of the competing business activities.
(ii) In the event that, within a period of forty-five (45)
days after the date of the Buyer's receipt of said
price offer, the Parties have not reached any
agreement in respect of such acquisition, the Sellers
and the Buyer shall meet in order to appoint an
independent third party expert, whose assignment
shall be to determine the fair price for the
acquisition of the competing business activity. The
independent expert must be appointed pursuant to a
joint decision by the Parties, within a period of
fifteen (15) days after the expiration of the
aforementioned period of forty-five (45) days.
Failing any such agreement between the Parties by the
end of said period of fifteen (15) days, the
independent expert shall be designated pursuant to an
order to be rendered by the Chief Judge of the
TRIBUNAL DE COMMERCE (Commercial Court) of Paris,
ruling in summary proceedings (REFERE), upon a
petition filed by the most diligent Party.
The fees and the expenses of the independent expert
shall be split equally between the Sellers and the
Buyer.
The Sellers and the Buyer hereby irrevocably agree to
provide the independent expert with any information
and documents that may be relevant for the purpose of
determining the fair price.
The independent expert must comply with the principle
of bilateral procedures (PRINCIPE DU CONTRADICTOIRE),
with the confidentiality clause appearing in Article
11.5. of this Agreement and must file his report
within 2 months of being designated.
(iii) Within a period of fifteen (15) days after the filing
of the independent expert's report, the Buyer must
state whether it intends to acquire the competing
business activities, in which case such sale must be
consummated within a period of fifteen (15) days
thereafter, and the sales price must be paid in cash
by the Buyer, against delivers by the Sellers of the
deeds of title in and to the competing business
activities.
7.4. For a period of three (3) years starting from the Closing Date the
Sellers shall not (and shall procure that the subsidiaries that they
Control shall not) directly or indirectly solicit for employment the
Key Employees without the prior written consent of the Buyer.
ARTICLE 8 - REPRESENTATIONS AND WARRANTIES
8.1 REPRESENTATIONS AND WARRANTIES OF THE SELLERS
The Sellers hereby jointly and severally grant the Buyer warranties in the form
of representations and warranties provided in the Exhibits (EXHIBIT 8.A. for
Ducros and EXHIBIT 8.B. for Sodis) and undertake to reiterate the said
representations and warranties on the day of the Closing Date.
The terms of indemnification in respect of the warranties other than those
regarding Taxes are set out in Article 9.1 below, and the terms of
indemnification in respect of the warranties regarding Taxes are set out in
EXHIBITS 4.5 and 4.10.
8.2 REPRESENTATIONS AND WARRANTIES OF THE BUYER
The Buyer represents and warrants to the Sellers and undertakes to
reiterate the said representations and warranties on the day of the
Closing Date, that:
a) It is a validly incorporated and registered company in accordance with
the Laws of Maryland, USA, has full capacity to own its assets and
carry out its activities as currently conducted.
b) It has full capacity to execute this Agreement and the other documents
referred to in this Agreement and it is not subject to any legal
recovery or bankruptcy proceedings or their equivalent according to the
law of Maryland, USA, or to any moratorium proceeding with respect to
payment of its liabilities.
c) There are no claims, lawsuits, proceedings, arbitration proceedings,
legal or administrative proceedings against it underway or any threats
of claims, lawsuits, proceedings, arbitration, legal or administrative
proceedings likely to challenge (i) the validity of the Buyer's
signature of the Agreement, (ii) the fulfillment of the obligations of
the Buyer pursuant to the Agreement or of one of the documents cited in
the Agreement, or (iii) the Buyer's execution of the transactions
anticipated herein.
d) The signing of the Agreement and completion of the operations contained
therein:
(i) do not violate any term or provision of the bylaws of the
Buyer or any agreement to which it is party;
(ii) do not require, subject to the provisions of Article 10.1. and
12 below, any consent, authorization or action by any
government entity, or any filing with or notification of any
government entity by the Buyer under any Law whatsoever.
e) It is capable of financing the obligations undertaken by it under this
Agreement.
The indemnification procedure under this guarantee is provided for by Article
9.2.
ARTICLE 9 - INDEMNIFICATION
9.1 INDEMNIFICATION BY THE SELLERS WITH A TRIGGERING FACTOR OTHER THAN TAX
9.1.1 EXTENT OF THE GUARANTEE
The Sellers undertake jointly and severally to indemnify the Buyer as a
reduction in the Sales Price (the "Indemnity") of the Ducros Shares or the Sales
Price of the Sodis Shares as the case may be, for any loss (the "Indemnifiable
Loss") resulting from:
a) a reduction in the amount of any asset or an increase in the amount of
any liability resulting from a liability not recorded in the 1999
Proforma Consolidated Balance Sheet for the Ducros Group or in the 1999
Consolidated Accounts of the Sodis Group, or from insufficient reserves
in the 1999 Proforma Consolidated Balance Sheet for the Ducros Group or
the 1999 Consolidated Accounts of the Sodis Group, where the cause or
origin of this reduction in assets or increase in liabilities is prior
to or on December 31, 1999, or;
b) an inaccuracy or omission in the representations and warranties set
forth in EXHIBIT 8.A. for Ducros and in EXHIBIT 8.B. for Sodis where
the cause or origin of this inaccuracy or omission is prior to, or on,
the Closing Date or the date indicated in the relevant representation
or warranty and to the extent that the Indemnifiable Loss would not
have been indemnified by application of the provisions contained in
Article 9.1.1(a) above, or
c) any breach of any other covenants and obligations of the Sellers which
they have undertaken under the terms of this Agreement.
The Indemnifiable Loss shall include reasonable lawyer's fees and costs
incurred by the Buyer with respect to its claim arising from a third
party or against a third party.
9.1.2. METHODS FOR CALCULATING THE INDEMNIFIABLE LOSS
9.1.2.1 For the purpose of calculating the Indemnity that the Sellers might be
obligated to pay the Buyer under this warranty, the Parties agree that:
a) In the case of a claim where the cause or the origin results
from the accounts or the representations and warranties
regarding any assets or liabilities of Desserts Products
International or Mul, the Indemnity will be calculated by
taking into account the equity interest Ducros holds in them
of fifty one percent (51%) for Dessert Products International
and forty nine percent (49%), for MUL, of the amount of the
Indemnifiable Loss.
b) Any decrease in assets or increase in liabilities giving rise
to a claim under this warranty shall be off-set against any
increase in assets or decrease in liabilities of the same
accounting nature (e.g. recapture of provision for client
debts against non-payment of a client debt; recapture of
provision for litigation against court order to pay a sum of
money with respect to a litigation).
c) The Indemnity will only be due for amounts above the
provisions recorded in the 1999 Proforma Balance Sheet for the Ducros Group or
the 1999 Consolidated Accounts for the Sodis Group with respect to the event
giving rise to the claim.
d) The amount of the indemnity due in relation to a claim (i)
will be decreased by any amount of insurance indemnity paid to one of the
companies of the Ducros Group or the Sodis Group or to the Buyer in relation to
the relevant claim, if needs be, prior to the payment of the Indemnity (ii) and
in this case increased by the Tax which will be paid-up on receipt of such
insurance indemnity.
e) The provisions contained in Article 9 of the Tax Covenant and
Deed of Tax Indemnity, apply for the purposes of calculating the corresponding
Resulting Relief as defined in said Article 9.
f) A single cause may only give rise to a single indemnity
payment in respect of the present guarantee and a single event comprising two or
more simultaneous violations of the warranty may only be compensated on one
occasion.
g) Any reduction in assets or increase in liabilities sustained
by Desserts Products International or Malile and Semap shall only be taken into
account for the purposes of calculating the Indemnity insofar as Hero France has
not indemnified Ducros or Dessert Products International under the
representations and warranties that Hero France granted Ducros within the
framework of the contribution to Desserts Products International of the shares
making up the capital of Malile, pursuant to the "JOINT VENTURE AGREEMENT UNDER
THE CONDITIONS PRECEDENT" of November 8, 1999. Consequently, Ducros or the Buyer
must have enforced such representations and warranties beforehand in accordance
with their provisions unless its legal counsel provides it an opinion, and after
consulting with the Sellers and their legal counsel, that its chances of success
are unlikely.
h) Furthermore, in order that the Buyer is not indemnified
several times, no Indemnity will be due for any cause which has been taken into
account for the calculation of (i) the Actual EBIT or (ii) the Aggregated
Consolidated Net Position or (iii) the amount determined pursuant to Article
3.2.2.c) of this Agreement.
9.1.2.2 The Sellers shall be subrogated in the rights of the Companies or the
Buyer vis-a-vis (i) the Sellers' or the relevant company's insurance company and
(ii) vis-a-vis third parties in respect of any Indemnity payment in case of
coverage of the corresponding risk or any Indemnity payment corresponding to a
claim filed by such third parties.
Furthermore, in the event of an insurance settlement being paid out
after an Indemnity has been paid by the Sellers, the Buyer irrevocably
undertakes to reimburse within ten (10) Business Days following receipt thereof,
less the Buyer's reasonable costs incurred in connection with the enforcement of
the Indemnity and recovery of the insurance, the amount of this insurance
payment immediately to the Seller that paid the corresponding amount of an
Indemnity. Such amount shall be decreased by the Tax which will be paid on the
insurance indemnity. This also applies to the debts of Companies settled by a
debtor following payment of a corresponding indemnity by the Buyer, including
within the framework of the enforcement of a warranty agreement.
This clause, as well as the clause which appears at Article 9.1.2.1 d), will
also apply in the case of a reduction to the Sales Price of the Ducros Shares in
conformity with the provisions of Article 3.2.2 c).
9.1.2.3 The information, in particular, documents, facts, contracts, events,
clearly brought to the Buyer's attention in this Agreement and/or its Exhibits
and/or in the Exhibits of the representations and warranties stipulated in
EXHIBIT 8.A and in EXHIBIT 8.B are elements that discharge the Sellers from
their liability under these representations and warranties. Notwithstanding the
foregoing, there shall be no discharge of the Sellers' possible liability
regarding those matters listed on EXHIBIT 9.1.2.3
9.1.2.4 The Buyer undertakes, for itself and for the Companies, to take all
reasonable measures in order to limit either the effects of an event which may
give rise to an Indemnifiable Loss, or the amount of the Indemnifiable Loss
itself.
9.1.3. THRESHOLD AND CEILING
The Parties agree that indemnification by the Sellers in respect of the present
Article 9 shall be limited as provided below:
9.1.3.1.THRESHOLD / DEDUCTIBLE
(a) No Indemnity in respect of Indemnifiable Losses shall be owed
to the Buyer by the Sellers as long as the cumulative amount of the
Indemnifiable Losses accumulated by the Sellers is less than FRF 7,500,000
(seven million five hundred thousand French francs), it being
stated that any Indemnifiable Loss of an amount less than FRF 25,000 (twenty
five thousand French Francs) will be excluded from the scope of application of
the warranty except for any Indemnifiable Loss in relation to claims of an
identical nature the amount of each being less than FRF 25,000 (twenty five
thousand French Francs) but together exceeding FRF 25,000 which will be treated
as one single claim for the purposes of calculating the FRF 25,000 (twenty five
thousand French Francs).
(b) In the event that the trigger threshold as set forth in
Article 9.1.3.1 (a) is exceeded, the indemnification obligation of the Sellers
shall be due only for the portion in excess of FRF 2,500,000 (two million five
hundred thousand French francs).
(c) However, the threshold of FRF 7,500,000 (seven million five
hundred thousand French Francs) and the deductible of FRF 2,500,000. (two
million five hundred thousand French Francs) provided for in Article 9.1.3.1.a)
and Article 9.1.3.1 b) shall not apply to any Indemnifiable Loss arising out of
(i) title to the shares of the companies of the Ducros Group and the shares of
the companies of the Sodis Group (ii) trademarks, and (iii) Taxes, it being
specified that:
- the exclusion of any Indemnifiable Loss for an amount of less
than FRF 25,000. will not apply for Taxes and,
- the amount of any Indemnity owed by the Sellers to the Buyer
in respect of an Indemnifiable Loss where its cause is in one of the three items
described in paragraphs i),ii), and iii) of this Article 9.1.3.1 c) will not be
taken into account for calculating the threshold provided for in Article 9.1.3.1
a) which will continue to apply to claims whose cause is found in the other
items.
9.1.3.2.CEILING
a) The total amount of Indemnity for which the Sellers shall be
liable pursuant to this warranty shall not exceed (i) a sum equal to one hundred
percent (100%) of the total amount of the Sales Price for the Shares for
Indemnifiable Losses arising out of title to shares of the companies of the
Ducros Group or the shares of the companies of the Sodis Group (ii) a sum equal
to 60% (sixty percent) of the total amount of the Sales Price for the Shares for
Indemnifiable Losses arising out of trademark issues and (iii) a sum equal to
30% (thirty percent) of the total amount of the Sales Price for the Shares for
all other Indemnifiable Losses.
b) Any amount owed by the Sellers in respect of an Indemnifiable
Loss where its cause is found in one of the three items described in paragraphs
(i), (ii), (iii) of Article 9.1.3.2.(a) above, will automatically be taken into
account for calculating the ceiling fixed for this item but also for the
calculation of the two other ceilings.
9.1.4. TIME CONSTRAINTS
9.1.4.1.Any claims formulated pursuant to this Article 9 must be submitted:
(i) with respect to Taxes and title to the Shares before the
expiry of the applicable statute of limitation plus three (3) months, and
(ii) for environmental matters, before expiration of the period
provided for in the statute of limitation, without this period exceeding ten
(10) years from the Closing Date, in both cases plus three (3) months.
9.1.4.2.Any other claim must be notified within a period of two (2) years from
the Closing Date.
9.1.4.3.The expiry of the aforementioned time limits shall not affect the
Buyer's right to indemnification where the latter has duly submitted its claim
within the time frames stipulated above and pursuant to the provisions of
Article 9.1.5 below.
9.1.5. NOTIFICATION AND PAYMENT OF INDEMNITY
9.1.5.1.NON THIRD PARTY CLAIMS
Any claim regarding an event capable of triggering the indemnification
obligation provided for in this Article 9.1. must be notified to the Sellers by
the Buyer within a reasonable time period taking into account the circumstances
and in all cases within sixty 60 days from the date that the Companies had
knowledge of such event. Such notification should specify the reasons why the
indemnification obligation has been invoked, as well as the amount of the
Indemnifiable Loss, if this is determinable, and should be accompanied by any
relevant documents then available.
9.1.5.2.THIRD PARTY CLAIMS
a) The Buyer undertakes to notify the Sellers of any third party claims or
judicial or administrative proceedings brought by third parties against one of
the Companies and which is likely to lead to a claim against one of the Sellers
within a time period sufficient enough to enable the Sellers to exercise their
rights or to state their opinion on the proceedings or claims and defend their
interests. The Buyer will take particular care in case of an emergency (for
example, in case of an application for the adoption of summary proceedings).
The notification should state, so far as then known to the Buyer, the reasons
why the Sellers' indemnification obligation has been invoked as well as the
amount of the Indemnifiable Loss, if this is determinable, and should be
accompanied by any relevant documents (claim letter, procedural acts, exhibits
from the file, etc.) then available. The Buyer shall subsequently keep the
Sellers regularly informed of:
(i) any negotiations with any third parties in order to allow the
Sellers to state their opinion or that of any counsel of their
choice on such negotiations with the third party;
(ii) the progress of the proceedings by delivering all useful
information (proceedings documents, hearing date, etc.) in
order to allow the Sellers to state their opinion or
that of any counsel of their choice on such proceedings, or to
exercise their rights resulting from this Article 9.1. In all
cases, the Buyer and the Sellers shall cooperate and exchange
the information necessary for the defense of the interests of
the relevant Company, the Buyer and the Sellers.
b) With regards to any proceedings, and irrespective of which Party is
taking the lead on the dispute, each Party undertakes to cooperate with the
other Party, to keep it informed on the progress of the aforementioned
procedures and to allow it, or its legal counsel, to provide its/their point of
view.
c) The Sellers may, at their own expenses and costs and with the
assistance of any counsel of their choice and respecting the "DELICATESSE"
principle vis-a-vis the Ducros Group and the Sodis Group, ensure the
representation of the relevant Company in such proceedings, subject to (i) the
Sellers (x) notifying the Buyer in writing within ten (10) Business Days after
the date that Buyer has given notice of the third party claim, of their decision
to do so and (y) confirming that they will indemnify the Buyer for any
Indemnifiable Loss under the terms and conditions of this Agreement that the
Buyer may suffer, resulting from or arising out of the third party claim, (ii)
the third party claim involving only money damages and not seeking injunction
and (iii) the Buyer being regularly kept informed of the progress of these
proceedings in order to allow him, assisted by any counsel of his choice, to
state his opinion.
(d) The Buyer and the Companies, for which the Buyer is answerable
("PORTE-FORT"), and/or the Sellers irrevocably prohibit themselves from entering
into a settlement agreement with any third party without the prior agreement of
the other Party. Neither the Sellers nor the Buyer may raise any objection,
unless such objection is on very serious grounds, to any settlement agreement
that is in (i) the best interests of the Company affected by the third party
claim and (ii) would not harm the defense of the Sellers' interests;
9.1.5.3.PAYMENT OF INDEMNIFICATION
(a) Save any objection of the Sellers notified to the Buyer within thirty
(30) Business Days of receipt by the Sellers of the notification provided for by
Articles 9.1.5.1 and 9.1.5.2 above, the Indemnifiable Loss shall be deemed due
and the Indemnity payable (if it can be calculated) within a period of ten (10)
Business Days from the expiry of the period of thirty (30) Business Days and
shall accrue interest from the expiry of such period of ten (10) Business Days
(the interest being paid at the same time as the indemnification). The
applicable interest rate shall be the monthly EURIBOR rate. If the EURIBOR
ceases to be published, it shall be replaced as of right by the interest rate
that replaces it.
(b) If, on the contrary, the Sellers notify the Buyer of their objection
within the period of thirty (30) Business Days as set forth by Article 9.1.5.3
a) above, the Indemnity shall be payable within ten (10) Business Days from,
either the date of an amicable settlement between the Parties, or in the absence
of an amicable settlement, from service of a judgement construed as final
rendered pursuant to the provisions of Article 11.11 below, and will bear
interest from the
expiration of this period of ten (10) Business Days (the interest being paid at
the same time as the indemnification). The applicable interest rate shall be the
monthly EURIBOR rate. If the EURIBOR ceases to be published, it shall be
replaced as of right by the interest rate that replaces it.
(c) In the event of any proceedings brought against any third party, and in
case of an agreement from the Sellers concerning the principle of
indemnification, the Indemnity will be payable within ten (10) Business Days
from notification of the decision construed as final and will bear interest from
the expiration of this period of ten (10) Business Days (the interest being paid
at the same time as the indemnification). The applicable interest rate shall be
the monthly EURIBOR rate. If the EURIBOR ceases to be published, it shall be
replaced as of right by the interest rate that replaces it.
9.1.6. BENEFICIARY OF THE INDEMNIFICATION
The obligation to indemnify, whatever the origin of the Indemnifiable Loss, is
stipulated as being in the favor of the Buyer and its beneficiaries, either on
an individual or collective basis, and particularly in the favor of any company
that succeeds the Buyer further to a merger or spin-off.
9.1.7. PRICE REDUCTION
The Parties agree that the Indemnity paid to the Buyer pursuant to Article 9.1
of this Agreement or pursuant to the Tax Covenant and Deed of Tax Indemnity
shall be treated as a non-Taxable reduction in price as described in Article 8
of the Tax Covenant and Deed of Tax Indemnity, and shall be deducted from the
Sales Price of the Ducros Shares, if Ducros or a Subsidiary of Ducros is at the
origin of the Indemnifiable Loss, and deducted from the Sales Price of the
Shares of Sodis if Sodis or a Subsidiary of Sodis is at the origin of the
Indemnifiable Loss.
9.2. INDEMNIFICATION BY THE BUYER
The Buyer agrees to compensate the Sellers for any loss that the Sellers may
suffer:
a) from any inaccurate or insincere representations and
warranties of the Buyer stipulated in Article 8.2;
b) from the Buyer's failure to fulfil any of the other
commitments and obligations it has undertaken pursuant to this Agreement.
The indemnification proceedings in this context will be identical to the
proceedings set forth in Article 9.1.5. above in connection with indemnification
by the Sellers. The word "SELLER" being replaced by the word "BUYER" and
vice-versa in the text of Article 9.1.5.
Any claim under this Article 9.2 must be notified within a period of two (2)
years from the Closing Date.
9.3 MANDATE GIVEN TO EBS BY THE SELLERS
For the purposes of the notifications set forth in this Article 9, the
"SELLERS" means EBS only, which CFS mandates to represent it in accordance with
the provisions of Article 11.15.
ARTICLE 10 - CONDITIONS PRECEDENT
10.1 The sale of the Shares is expressly subject to the following Conditions
Precedent:
10.1.1 The Spanish Service for the Defence of Competition (SERVICIO DE DEFENSA
DE LA COMPETENCIA) having indicated to the Buyer in a form reasonably
satisfactory to the Buyer that (i) it approves the sale of the Shares to the
Buyer without conditions / or under conditions satisfactory to the Buyer, or
(ii) the one-month time limit for such indication having expired without any
indication from the SERVICIO DE DEFENSA DE LA COMPETENCIA, or (iii) the Spanish
Minister of Economy and Finance (MINISTRO DE ECONOMIA Y HACIENDA) having
indicated to the Buyer in a form reasonably satisfactory to the Buyer that it
authorizes the sale of the Shares to the Buyer without conditions (or under
conditions satisfactory to the Buyer).
10.1.2. The French Minister of the Economy and Finance, having indicated to the
Buyer in a form reasonably satisfactory to the Buyer that it approves the sale
of the Shares to the Buyer without conditions (or under conditions satisfactory
to the Buyer) or alternatively that the time limit for such ministerial approval
has expired without any contrary decision being rendered by the French Minister
of the Economy and Finance.
10.1.3 The Portuguese Merger Control Authority "Direccao Gerale de Commercial
e Concorencia" having indicated to the Buyer in a form reasonably satisfactory
to the Buyer that (i) it approves the sale of the Shares to the Buyer without
conditions / (or under conditions satisfactory to the Buyer) (ii) it has no
intention of referring this transaction to the Portuguese Competition Council or
(iii) the time limit for such referral has expired without any referral having
been made to the Portuguese Competition Council or (iv) the Portuguese
Competition Council having indicated to the Buyer in a form reasonably
satisfactory to the Buyer that it approves the sale of the Shares without
conditions (or under conditions satisfactory to the Buyer).
10.1.4 No statute, regulation or decision having been enacted or taken by any
administrative authority, and no action, suit or proceedings being pending
before any court or administrative authority capable of prohibiting, restricting
or materially delaying the sale of the Shares.
10.2 The parties will cooperate and do what is necessary to jointly take the
steps that need to be taken vis-a-vis the relevant anti-trust authorities and
make the filings required by Articles 10.1.1, 10.1.2 and 10.1.3 by July 31, 2000
at the latest. The Buyer shall keep the Sellers informed sufficiently in advance
of progress in these steps as they advance. The Sellers will be able to
participate in such steps as they advance if they consider this necessary.
10.3 In the event that the Buyers do not obtain a reasonably satisfactory
informal favorable response from the Competition authorities, the Buyer may
decide, after consulting with the Sellers and taking into account their
analysis, whether to make an official notification to the competition
authorities, in France or in Spain, subject to the Sellers having the
possibility, in the event that the Buyer decides not to go ahead with such a
notification, if they have a legitimate reason, to demand that such a
notification be made. Alternatively, the Buyer will provide an opinion letter
from a renown law firm confirming that such notification is not required under
the applicable competition laws, in which case the notification shall not be
made.
10.4 The Parties may together waive all or any of the Conditions Precedent
set out in Articles 10.1.1 to 10.1.4 above.
10.5 In the event that the Conditions Precedent have not been fulfilled by
November 30, 2000 or waived in accordance with Article 10.4, the Agreement shall
be null and void as of right at that date, save any extension of the term
decided by mutual agreement of the Parties, subject to the provisions of Article
11.1, and save for any Party's right to be indemnified for any breach of an
obligation it has undertaken under this Agreement prior to it being voided.
ARTICLE 11 - MISCELLANEOUS
11.1. EXPIRY OF RIGHTS AND OBLIGATIONS
In the event that the Agreement becomes null and void pursuant to, namely, the
provisions of Article 10 above, only the provisions of Articles 11.2
(Notification), 11.4. (Disclosure), 11.5 (Confidentiality), 11.11 (Disputes),
11.13 (Language), 11.14 (Applicable law) and 11.15 (Mandate) shall continue to
bind the Parties.
Furthermore, the Buyer irrevocably undertakes, within a one-year period from the
date on which this Agreement would become null and void, to abstain from
soliciting, directly or indirectly, any of the Key Employees.
11.2. NOTIFICATION
11.2.1. Any notification provided for under this Agreement must be made in
writing as indicated at Article 11.2.2., to the following addresses or fax
numbers:
(a) SELLERS:
MAIN ADDRESSEE: XXXXXXXX XXXXXX-SAY
ATTENTION: XX. XXXXXXXXX XXXXXX-XXXXXXXX
Director, Legal Department
00 xxxxxxxxx xx Xxxxxxx Xxxxxxx
00000 Xxxxxxx-xxx-Xxxxx
Xxxxxx
Fax: (33) (0)0 00 00 00 00
COPY TO: CL & A - COURNOT, LEMETAIS & ASSOCIES
ATTENTION: XXXXXXXX X. COURNOT
0 xxx Xxxxxxx, 00000 Xxxxx
Xxxxxx
Fax: (33) (0) 0 00 00 00 00
(b) BUYER:
MAIN ADDRESSEE: XXXXXXXXX & COMPANY, INCORPORATED
ATTENTION: XXXXXX X. XXXXXXX
Vice President, General Counsel and Secretary
00 Xxxxxxx Xxxxxx
Xxxxxxx; Xxxxxxxx
XXX
Fax: (00) (0) 000 000 0000
COPY TO: XXXXX & XXXXXXXX
ATTENTION: XXXX XXXXX
00 / 00 Xxxxxx Xxxxxx
00000 Xxxxx
Xxxxxx
Fax: (33) (0) 0 00 00 00 00
11.2.2 Notification shall be deemed to have been validly delivered when
delivered to the main addressee in the following manner:
i) at the date of delivery, when personally delivered to the
address indicated above;
ii) at the date of sending, when sent by fax to the fax number
indicated above with confirmation of receipt by the addressee and if it is
confirmed by letter sent, immediately, to the address indicated above;
iii) at the date of receipt, if sent by registered letter with
return receipt requested to the address indicated above.
11.2.3. Each Party may modify the address, fax number or any other
information indicated above at any time, provided that it informs the
other Parties of this in advance in accordance with the provisions of
Article 11.2.2.
11.3 ENTIRE AGREEMENT
The Agreement, the Exhibits and the Related Agreements and any other document
executed pursuant to this Agreement, supersede all previous discussions,
agreements or correspondence between the Parties and/or their counsel and are
the final and complete expression of the will of the Parties.
11.4. DISCLOSURE
The Sellers and the Buyer shall not issue or make any statement or release to
the public concerning this Agreement or the transactions contemplated herein
without the prior consent of the other Party, unless such statement or release
is required by Law or ordered by a court or an administrative authority, in
which event the Party required to make such disclosure shall try to limit the
effects, and shall inform the other Party of the content of the announcement
concerned prior to its release. If the time frame does not permit the Parties to
mutually consult each other in advance, the Party required to make such
disclosure shall inform the other Party of the content of the announcement as
soon as possible.
11.5. CONFIDENTIALITY
Each Party shall observe, and instruct its Affiliates and representatives and
counsel to observe the strictest confidentiality with respect to this Agreement
and any document or information concerning the other Party or one of its
Affiliates, communicated to one Party by the other in connection with this
Agreement or the transactions contemplated herein;
a) unless it can be proven that such documents or information were:
(i) previously known to the Party receiving such documents or
information such Party having received them without breaching
any regulation,
(ii) in the public domain (either prior to or after the
transmission of such documents or information), or
(iii) acquired at a later date by the receiving Party from another
source, if such receiving Party is not aware that such source
is under an obligation to keep such documents or information
confidential.
b) unless it is forced to disclose such documents or information by Law,
legal or administrative process (including, but not limited to, those
related to the obtaining of the necessary approvals by the government
bodies of this Agreement and the transactions contemplated herein) or by
other legal or regulatory requirements, or else induced to disclose such
documents or information within the framework of an action or proceedings
brought in the exercise of its rights deriving from the Agreement.
11.6. ADDITIONAL UNDERTAKING
Subject to the provisions of Article 11.16 below, at any time from the signing
of this Agreement, each Party shall execute and deliver to the other Party any
documents and information necessary for the satisfaction of the Conditions
Precedent and take all other actions as may be required to carry out the
transactions contemplated by this Agreement.
11.7. AMENDMENTS AND WAIVERS
This Agreement may not be amended, and the waiving of any of the provisions of
this Agreement is only possible in writing, which writing should be duly signed
by the Party against which the amendment or waiver is to be enforced.
11.8. NON-TRANSFERABILITY - BINDING NATURE
Neither this Agreement nor any of the rights or obligations of this Agreement
may be transferred by one Party without the prior written consent of the other
Party, provided that the Buyer may assign the benefit of all or part of this
Agreement to any one or more of its Affiliates. If all or part of this Agreement
is assigned, the seller will remain jointly and severably liable with the buyer
regarding the performance of the obligations contained in this Agreement.
11.9. EXPENSES
Each Party shall pay its costs and expenses incurred in connection with the
preparation, negotiation and signing of this Agreement.
The registration duties relating to the sale of the Shares shall be borne by the
Buyer.
11.10. LANGUAGE
11.10.1 This Agreement is drafted in the French language, which will
constitute the governing language, excluding any other version
prepared in any other language and except for terms used in another
language which terms shall then be deemed binding.
11.10.2. The Exhibits may be drafted in a foreign language in which case this
foreign language draft will be the governing language.
11.11 DISPUTES
(a) The Parties will try amicably to resolve any disputes that may arise
between them in connection with the performance of this Agreement,
within a 2 (two) month period from when the dispute arises.
(b) In the event that any dispute regarding the validity, the
performance, the termination or the interpretation of this
Agreement persists and subject to the provisions of
Articles 3.4(c) to (h) and Article 7.3(c)(ii) above, said dispute
shall be finally settled by an arbitration tribunal sitting in Geneva
in accordance with the Rules of Arbitration of the International
Chamber of Commerce ("ICC"), made up of three (3) arbitrators
appointed in accordance with said rules. The Chairman of the
arbitration tribunal may not be of French, American or Italian
nationality. For the purposes of this clause, XxXxxxxxx & Company,
Incorporated and the company that it may substitute for itself to
close the transaction shall be represented by one single arbitrator,
and EBS and CFS shall also be represented by one single arbitrator.
The arbitrators must speak both English and French fluently. The
proceedings shall be held in Geneva, in the English language. However,
each of the Parties shall have the right to select the language in
which it shall draft its court submissions (MEMOIRES) and any written
correspondence, and such documents shall be accepted by the arbitrators
in English or in French, and without any need for any translations
thereof (whether from French into English, or from English into
French). In addition, the Exhibits shall be transmitted in their
original language. The arbitral award shall be drafted in English. The
fees of the arbitrators as well as costs and expenses related to the
arbitration, including reasonable attorneys' fees, shall be borne by
the Parties in the proportions decided upon by the arbitration tribunal
in its award.
(c) The arbitratral award shall be final and binding on the Parties, and
any decision for the purpose of the enforcement of said award may be
applied for in any court of competent jurisdiction.
(d) By its signature of this Agreement, each of the Parties hereby
irrevocably agrees to submit to the jurisdiction of the ICC, to the
jurisdiction of the arbitration tribunal that may be formed pursuant to
the Rules of Arbitration of the ICC and of any court that may have
jurisdiction by reason of the arbitral award rendered under this
Agreement.
The Parties hereto irrevocably agree to, promptly and in good faith,
implement any award that may be rendered pursuant to the provisions of
this Agreement, provided only that said award has become final.
(e) Notwithstanding this arbitration clause, the Parties may seek
conservatory measures before the competent national courts.
11.12. INVALID PROVISIONS
If any of the provisions of this Agreement is found to be unlawful or
non-enforceable by application of any Law present or future, and provided that
the rights and obligations of a Party under this Agreement are not affected
negatively in a significant manner, the following principles shall apply: (a)
such provision shall be distinguished from the other provisions of the
Agreement, (b) this Agreement shall be interpreted and applied as if the
unlawful or non-enforceable provision had never been a part of it, (c) the other
provisions of the Agreement shall remain in force and shall not be affected by
the unlawful or non-enforceable provision, and (d) in lieu of any such unlawful
or non-enforceable provision a lawful and enforceable provision shall be
included automatically as part of the Agreement under terms which are as similar
as possible to the deleted provision.
11.13 APPLICABLE LAW
The Agreement is governed by the laws of France.
11.14. DUPLICATES
Several copies of the Agreement may be signed by each Party individually, each
copy being certified as an authentic copy of the original. However, the totality
of the copies shall constitute a single and unique agreement.
11.15. MANDATE
CFS hereby appoints EBS, which accepts, as its representative with the task of
receiving and circulating any notice, taking any decisions and signing any
documents in respect of or necessary for the performance of this Agreement in
the name of and on behalf of all the Sellers.
11.16 ACCESS TO CERTAIN INFORMATION AND PERSONNEL OF DUCROS
As of the execution of this Agreement and until the Closing Date, the Buyer
(subject to and in accordance with the terms and conditions set out below) shall
have a right of access to all offices and manufacturing sites, books and
records, documents, contracts and other materials relating to the business
affairs, finances, Products, assets, operations and personnel of Ducros, Sodis
and their Subsidiaries, including Xx. Xxxxxxx and Xx. Xxxxxxxx.
The Buyer's requests must be reasonable, and the "reasonable" nature thereof
shall be assessed with regard to the objective being sought, i.e., to provide
the Buyer with a better understanding of the business of the Companies to
facilitate the transition between the Sellers and the Buyer.
In addition:
- the exercise of the above-specified option by the Buyer must not
represent, in any manner whatsoever, any interference with regard to
the activities of the Companies and/or their personnel;
- the inspections or examinations of documents shall be performed (i)
during normal business hours, (ii) in the presence of a representative
of the Sellers responsible for namely, ensuring that confidentiality is
respected (iii) where appropriate, on premises other than the premises
of the Companies, and (iv) in the presence of up to a maximum of four
(4) representatives of the Buyer accompanied, if necessary, by a
translator and (v) will not exceed 2 days a week pursuant to the Access
Plan attached as EXHIBIT 11.16;
- any inspection or examination of documents must be notified to the
Sellers at least three (3) Business Days in advance. Such notice must
include a precise description of the premises, persons and documents to
which or to whom the Buyer would like to have access.
In the case that Closing does not take place within five (5) weeks of signing
this Agreement, the Buyer will provide the Sellers with a new Access Plan for
the subsequent weeks on the same basis and under the same conditions.
11.17 TAXES
Any issue related to Tax is settled by this Agreement unless it is specifically
referred to in the Tax Covenant and Deed of Tax Indemnity and by the Agreement
for a Departure from the Tax Consolidation Group in which case it shall be
settled by such agreements. In the case of any discrepancies regarding a Tax
issue between any provision of the Agreement and a provision of the Tax Covenant
and Deed of Tax Indemnity or of the Agreement for the Departure from the Tax
Consolidation Group, the provisions of the Tax Covenant and Deed of Tax
Indemnification or of the Agreement for a Departure from the Tax Consolidation
shall prevail.
ARTICLE 12
The Buyer undertakes to file, on its behalf and on behalf of the Sellers, no
later than two (2) weeks after signature of this Agreement, the necessary filing
in order that the transaction contemplated by this Agreement be examined by the
Polish merger control authorities.
The Parties shall cooperate in the preparation of this filing as promptly as
possible.
Executed in Paris, on July 12, 2000
In 5 originals.
--------------------------- ------------------------
For EBS For CFS
Xxxxxxx Xxxxxx Xxxxxx Xxxxx
---------------------------------- ----------------------------------
For XxXxxxxxx & Company, Incorporated For XxXxxxxxx & Company, Incorporated
Xxxxxx X. Xxxxxxx Xxxxxx X. Xxxxx, Xx.
EXHIBIT 8 A
REPRESENTATIONS AND WARRANTIES
OF THE DUCROS GROUP
PRELIMINARY ARTICLE
All the representations and warranties regarding Mul are given uniquely "TO THE
SELLERS' KNOWLEDGE", except those given in Articles 1,2 and 4 of this EXHIBIT
8.A. Furthermore, the Sellers declare that none of the companies of the Ducros
Group, can be held personally liable for the consequences of any act or
liability of Mul, except Ducros in its capacity as a shareholder up to the
amount of its equity interest in Mul's share capital (75,900 FRF). None of the
companies of the Ducros Groups nor their directors are de facto managers of Mul.
ARTICLE 1 - CAPACITY OF CFS
1.1 - Each of CFS and EBS has requisite powers and authority to enter into
this Agreement and the Related Agreements and to fulfill its respective
obligations incumbent upon it, particularly in the case of CFS to sell
the Shares.
1.2 - Except as provided for at Article 10 and 12 of the Agreement, the
signing of this Agreement and the Related Agreements by CFS and EBS and
the closing of the transactions contemplated herein:
a) are not subject to any prior authorization, consultation or
approval, as the case may be, by the management boards of CFS,
EBS and Ducros, the Workers Council of EBS and Ducros, or
administrative authorities other than those that have already
been obtained and a copy of which was supplied to the Buyer
pursuant to the provisions of Article 5.2 of this Agreement;
and, except with regards to approval by the Board of the Buyer
as a new shareholder of Ducros which shall be obtained before
the Closing Date, no other corporate action on the part of the
Sellers is necessary to authorise this Agreement or the
closing of the transactions contemplated herein;
b) will not violate any of the clauses of the by-laws of CFS, EBS
or Ducros;
c) are not contrary to the provisions of any judicial or
administrative decision.
ARTICLE 2 - INCORPORATION OF THE COMPANIES OF THE DUCROS GROUP
2.1 - The companies of the Ducros Group were duly incorporated and are duly
registered with the registry of commerce and companies or its
equivalent. The secondary establishments of the companies of the Ducros
Group have also been duly registered with the registry of commerce and
companies when such registration is required by Law.
2.2 - The by-laws of the companies of the Ducros Group except those listed
in EXHIBIT 8.A.2.2, have been filed at the registry of commerce and
companies and are complete, exact and up to date.
2.3 - The companies of the Ducros Group registered in France are not
subject to any proceedings initiated on the basis of the prevention and
amicable settlement of corporate financial difficulties or any
insolvency proceedings or legal liquidation, or their equivalent for
the companies of the Ducros Group registered outside France, and there
are no grounds for these companies to be subject to such proceedings.
Each company of the Ducros Group is solvent and able to pay its debts
as they fall due. Except as set forth in EXHIBIT 8.A.2.3., the
shareholders of the companies of the Ducros Group have not decided to
liquidate them, and the companies are not subject to any legal decision
ordering such liquidation.
2.4 - Except as set forth in EXHIBIT 8.A.2.4., the corporate bodies
("ORGANES SOCIAUX") of the companies of the Ducros Group were set up
and operate in accordance with the Laws applicable to them. The
registers, books and documents of these companies are held in
accordance with provisions of the Law and truly and accurately reflect
the corporate decisions made by these companies.
ARTICLE 3 - AUTHORIZATIONS AND OTHER PERMITS
3.1 - Except as set forth in EXHIBIT 8.A.3.1., the companies of the Ducros
Group have all the Authorizations necessary to carry out their
Activities as these are currently carried out. These Authorizations are
in full force.
3.2 - To the Sellers' Knowledge, there are no facts or events likely to
result in the withdrawal, suspension or questioning of said
Authorizations. The companies of the Ducros Group carry out their
activities in accordance with these Authorizations and all applicable
Laws.
ARTICLE 4 - SHARE CAPITAL
4.1 - For each of the companies of the Ducros Group, EXHIBIT 8.A.4.1
identifies, as of the date of this Agreement (i) the jurisdiction and
date of incorporation, (ii) the names of its directors or managers and
the date that their position is to be renewed, (iii) the share
capital, (iv) the number of shares, and (v) the names of all the
shareholders as well as the number and percentages of shares they own.
4.2 - The shares and equity interests ("PARTS SOCIALES") that make up all
the capital of the companies of the Ducros Group are the only
transferable securities issued by the companies of the Ducros Group.
The companies of the Ducros Group have not issued or promised to issue
any other securities of any type whatsoever, including but not limited
to investment certificates ("CERTIFICAT D'INVESTISSEMENT") and
preferred shares without voting rights ("ACTIONS PRIORITAIRES SANS
DROIT DE VOTE") or bonds ("OBLIGATIONS").
Except as set forth in EXHIBIT 8.A.4.2., the companies of the Ducros
Group have made no commitment concerning (i) a capital increase,
particularly through the issue of options or convertible or
exchangeable securities or (ii) other rights to acquire or to offer
shares, equity interests securities, bonds, Liens or other rights over
the share capital of any of the companies of the Ducros Group.
From the Closing Date, the Buyer shall exercise all the rights attached
to the Ducros Shares, particularly the right to vote and the right to
receive all dividends.
4.3 - Except as set forth in EXHIBIT 8.A.4.3., the shares and equity
interests making up the capital of the companies of the Ducros Group
are validly issued and fully paid-up; except as set forth in EXHIBIT
8.A.4.3., the shares and equity interests are freely transferable and
there are no other restrictions to their transferability other than
those set forth in this Agreement and those resulting from the Law or
their by-laws.
4.4 - Except as set forth in EXHIBIT 8.A.4.4, the shares and equity
interests of the companies of the Ducros Group are free from any Liens.
ARTICLE 5 - EQUITY INTERESTS
5.1 - Except as set forth in EXHIBIT 8.A.5.1. and for their equity
interests within the group, the companies of the Ducros Group do not,
directly or indirectly, hold any equity interest of any amount or kind
whatsoever in any company or legal entity, nor has any company of the
Ducros Group any liability arising out of any equity interest in any
company or legal entity which it no longer holds.
5.2 - Except the position of President of Sodis held by Ducros in, the
companies of the Ducros Group do not exercise any duties as legal
representatives of a company ("MANDATAIRES SOCIAUX") in another company
and are not likely to be qualified as a de facto manager of another
company or legal entity.
5.3 Except as set forth in EXHIBIT 8.A.5.3., the companies of the Ducros
Group are not party to any shareholders' agreement or to any other
agreement that deals with the management of a company of the Ducros
Group by a company which is not in the Ducros Group or which aims to
split all or part of the profits with a third party, and they have not
promised to enter into any such agreements.
5.4 Ducros is party to a joint venture with Hero France pursuant to (i)
contribution agreements nos. 1 and 2 (without their exhibits), (ii) a
joint-venture agreement subject to conditions precedent, (iii)
representations and warranties (without their exhibits) dated November
8, 1999 as attached in EXHIBIT 8.A.5.4.
5.5 By decision of the general shareholders' meeting dated May 5, 2000,
Malile was merged into Dessert Products International, the merger and
contribution agreement is attached as EXHIBIT 8.A.5.5.
ARTICLE 6 - FINANCIAL STATEMENTS
6.1 The 1999 Proforma Consolidated Balance Sheet of the Ducros Group, which
is attached in EXHIBIT 1(d)1 of the Agreement, complies with the Laws
and was prepared in accordance with French GAAP, taking into
consideration the consolidation principles. The 1999 Consolidated
Accounts of the Ducros Group are true and accurate and fairly present
the financial position, the income statement and the assets and
liabilities of the companies of the Ducros Group as of December 31,
1999, were prepared in accordance with French GAAP and show all
liabilities and off-balance sheet items.
The balance sheets and schedules of Malile and Semap as at December 31,
1999 which are attached as EXHIBIT 1d(2) of the Agreement are true and
accurate and fairly present the financial position and the assets and
liabilities of Malile and Semap as at December 31, 1999, were prepared
in accordance with French GAAP and show all liabilities and off-balance
sheet items.
6.2 Except as set forth in EXHIBIT 8.A.6.2, the companies of the Ducros
Group have no off-balance sheet commitments nor any litigation at 31
December 1999, other than those mentioned in the 1999 Consolidated
Accounts of the Ducros Group and regarding Malile and Semap, in their
1999 balance sheets and schedules.
6.3 Except as set forth in EXHIBIT 8.A.6.3, the companies of the Ducros
Group have not issued or promised to issue any guarantees, securities
or letters of comfort to guarantee performance of third party
obligations nor do they have any unusual liabilities or other
liabilities other than those arising in the ordinary cause of business
which have not been recorded in the 1999 Consolidated Accounts of the
Ducros Group and with respect to Malile and Semap, in the 1999 Balance
Sheets for Malile and Semap.
6.4 The books and records of the Ducros Group properly reflect all
transactions of the Ducros Group in accordance with GAAP.
6.5 The Projected EBIT was prepared on the basis of future sales and
objectives for revenues and profits for the Ducros Group and for the
Sodis Group, which the Sellers estimated, at the time the amounts were
established and taking into account their experience, could reasonably
be achieved by the two groups subject to risks and uncertainties which
could affect them and which originate from outside factors, including
but not limited to, action taken by competitors, relationships with
clients, fluctuations in costs, availability of the chain of suppliers,
foreign economic conditions and fluctuations in the exchange rates.
It is expressly agreed that this representation is not a warranty by
the Sellers that the objectives and results in the Projected EBIT will
be achieved.
ARTICLE 7 - PERSONNEL OF THE COMPANIES OF THE DUCROS GROUP
7.1 The lists of the employees of the companies of the Ducros Group as at
May 31, 2000, are attached as EXHIBIT 8.A.7.1.1. These lists set forth
the employer, name, title, nature of the term (either fixed or
indefinite) of their contract, their age, seniority, category and
classification, as necessary, as well as their remuneration, including
bonuses and benefits in-kind. They have not been significantly
modified since they were prepared.
The list of people assigned by EBS to the companies of the Ducros Group
and the terms of their assignment are attached as EXHIBIT 8.A.7.1.2.
The lists of employees on sabbatical leave, parental leave or on
long-term sick leave as at May 31, 2000, are attached as EXHIBIT
8.A.7.1.3.
Except as attached as EXHIBIT 8.A.7.1.4, none of the employment
contracts of the French Companies of the Ducros Group provide for a
notice period or payment of compensation in excess of that provided for
by applicable Laws or the collective bargaining agreement.
7.2 The list of Key Employees and legal representatives of the companies of
Ducros Group is attached as EXHIBIT 8.A.7.2.1.
To the Sellers' knowledge, none of the Key Employees has resigned or
threatened to resign. True and complete copies of the employment
contracts between the companies of the Ducros Group and the Key
Employees as currently in effect are attached as EXHIBIT 8.A.7.2.2.
Except as set forth in EXHIBIT 8.A.7.2.3., the legal representatives
of the companies of the Ducros Group do not have any employment
contracts or service contracts granted to them by the companies of the
Ducros Group.
7.3 - Except as set forth in EXHIBIT 8.A.7.3., the employment contracts
have been executed by the companies of the Ducros Group, taking into
account the positions occupied by the employees in accordance with
their contractual provisions, the collective bargaining
agreements ("CONVENTIONS COLLECTIVES") and Laws, particularly those
related to wages, working hours, and to health and safety conditions,
and the companies of the Ducros Group are up to date with their
obligations as employers.
7.4 - EXHIBIT 8.A.7.4. sets forth the titles of the collective bargaining
agreements applicable to the companies of the Ducros Group.
7.5 - The companies of the Ducros Group are not subject to any legal
decision or settlement agreement providing for the rehiring of a former
employee.
7.6 - EXHIBIT 8.A.7.6. lists or contains copies of the investigations,
notices received from or reports prepared by Labor Inspectors and
received by the companies of the Ducros Group during the last two (2)
years as well as copies of the responses given by the companies of the
Ducros Group.
7.7 - Except as set forth in EXHIBIT 8.A.7.7., the companies of the Ducros
Group have not experienced any strikes or other industrial action
during the last two (2) years, and, to the Sellers' Knowledge,
excluding the consequences linked to normal annual wage bargaining,
there are not any serious threats of strikes or other industrial
action.
7.8 - A copy of the agreements related to working hours signed by the
companies of the Ducros Group is attached as EXHIBIT 8.A.7.8.
7.9 - EXHIBIT 8.A.7.9. sets forth the labor law proceedings (administrative
or judicial) currently pending to which the companies of the Ducros
Group are party. To the Sellers' Knowledge, there are no serious
threats that such proceedings which would justify recording a provision
in the 1999 Proforma Consolidated Balance Sheet for the Ducros Group,
are initiated against the companies of the Ducros Group.
7.10. Save as disclosed in EXHIBIT 8.A.7.10, no company of the Ducros Group
makes or is required to make contributions to any pension, profit
sharing or other retirement plan, employee share ownership plan, bonus
or other incentive plan, contractual severance plan, health, death or
group insurance plan or similar plan agreement program or undertaking
("PLAN"). The companies of the Ducros Group have made all required
contributions under their respective Plans and paid all premium amounts
payable for all periods through and including the Closing Date when
required by applicable GAAP, and adequate provisions have been made in
the 1999 Proforma Consolidated Balance Sheet of the Ducros Group.
ARTICLE 8 - FIXED ASSETS
8.1 - Attached as EXHIBIT 8.A.8.1. is the list of the real property owned
by the companies of the Ducros Group.
The companies of the Ducros Group have full title and ownership of this
real property.
Except as set forth in EXHIBIT 8.A.8.1., this real property is not
subject to any mortgages and is not subject to any third-party action
to claim title or other Liens.
8.2 - The list of real property leased by the companies of the Ducros Group
is attached as EXHIBIT 8.A.8.2.1. No other leases or temporary leases
("CONVENTION D'OCCUPATION PRECAIRE") have been signed by the companies
of the Ducros Group.
Except as set forth in EXHIBIT 8.A.8.2.2., the companies of the Ducros
Group have not executed any financial leases ("CREDIT-BAIL") concerning
real property.
These leases, temporary leases and financial leases are in force and
are not subject to any disputes or claims except as disclosed in
Article 17 of this EXHIBIT 8.A. They do not contain any onerous
provisions.
The companies of the Ducros Group have complied with the contractual
clauses of leases, temporary leases and financial leases and the
companies of the Ducros Group are up to date with respect to payment of
rents and occupation indemnities.
All options granted to the companies of the Ducros Group with respect
to real property listed in EXHIBIT 8.A.8.2.2 have been duly exercised
in accordance with their terms and conditions by the relevant
companies.
Except as set forth in EXHIBIT 8.A.8.2.3., the companies of the Ducros
Group have not received any notice ("conge") or notice of termination
of these agreements, and these agreements do not provide any
termination clause or right of variation in the event of a change in
control in the capital or management of the companies of the Ducros
Group.
8.3 - Except as set forth in EXHIBIT 8.A.8.3 and the buildings in Albania,
the buildings conform, in all material respects, to the Laws and, in
particular, the zoning and building ordinances and safety, hygiene and
labor rules applicable to them. The buildings are in a normal state of
repair and maintenance, taking into account their age and the quality
of materials generally used locally, and their current condition does
not require any major structural or other repair.
8.4 - Except as set forth in EXHIBIT 8.A.8.4.1., the buildings are used
exclusively by the companies of the Ducros Group for the needs of their
usual activities and make up all of the buildings necessary for these
activities, subject to subcontracting activities. The buildings are
suitable for the purposes for which they are currently being used.
Except as set forth in EXHIBIT 8.A.8.4.2., the companies of the Ducros
Group have not granted any third party any rental agreements for the
buildings that belong to them or any sublease agreement for those which
they are leasing.
8.5 - Except as set forth in EXHIBIT 8.A.8.5., the companies of the Ducros
Group have not received any notification of any administrative or court
decision that might restrict or modify the use of the buildings by the
companies of the Ducros Group.
ARTICLE 9 - MOVEABLE PROPERTY OTHER THAN INVENTORIES
9.1 - Attached as EXHIBIT 8.A.9.1, is a list of the Moveable Property, as
at May 31, 2000, used by the companies of the Ducros Group. This
Moveable Property makes up all the Moveable Property necessary for the
normal course of the business of the companies of the Ducros Group,
except for that necessary for the sub-contracted industrial
manufacturing activities. There have been no material changes to the
lists of Moveable Property since this date.
9.2 - The companies referred to above have full ownership of all the
Moveable Property, except those used under a financial lease
("CREDIT-BAIL") or a lease agreement. The list of the lease or
financial lease agreements is attached as EXHIBIT 8.A.9.2.
9.3 - Except as set forth in EXHIBIT 8.A.9.3., the Moveable Property is not
subject to any Liens or any third-party action to claim title.
9.4 - Except as set forth in EXHIBIT 8.A.9.4., the Moveable Property is in
a normal state of maintenance and repair and operating conditions,
subject to ordinary wear. It is fit for the purposes for which it was
intended and all the legal and regulatory provisions applicable to it
have been complied with.
9.5 - The lease and financial lease agreements pertaining to Moveable
Property are in force and are not subject to any disputes or claims
except as set forth in Article 17 of EXHIBIT 8.A. The companies of the
Ducros Group have complied, in all material respects, with the
contractual clauses of these agreements and they are up to date with
all rent payments.
Except as set forth in EXHIBIT 8.A.9.5., the companies of the Ducros
Group have not received any notification of termination of these
agreements, and these agreements do not provide for any termination
clause or right of variation in the event of any change in the control
in the capital or management of the companies of the Ducros Group.
ARTICLE 10 - INVENTORIES
10.1 The inventories and work in progress appearing in the 1999 Proforma
Consolidated Balance Sheet of the Ducros Group were valued using
methods which are set forth in EXHIBIT 8.A.10. which comply with French
GAAP. Necessary and "PRUDENT" reserves have been made regarding such
inventories and work in progress taking into consideration age, state
and obsolescence.
10.2 The inventories and work in progress are the absolute property of the
relevant company of the Ducros Group and are free from Liens, subject
to usual and contractual or legal provisions and retention of title
clauses.
10.3 The level of inventories and work in progress is not materially
different from the levels thereof at comparable dates with respect to
previous years and after taking into account the evolution of business.
10.4 All outstanding purchase orders of each of the companies of the Ducros
Group were made in the ordinary course of business, consistent with
past practices, and will not have the effect of increasing inventories
beyond normal and customary levels.
10.5 The inventories of the companies of the Ducros Group are in good,
merchantable condition subject to reserves, free of damages or defects
and are suitable for the purposes, for which they are intended.
ARTICLE 11 - RECEIVABLES
11.1 - Reserves for receivables appearing in the 1999 Proforma Consolidated
Balance Sheet of the Ducros Group have been made in accordance with
French GAAP. Except as set forth in EXHIBIT 8.A.11.1. and to the
Sellers' Knowledge, no receivable is subject to a counterclaim. All
receivables are valid and enforceable and, not being the object of a
set-off except in the ordinary course of business, have realised their
nominal amount subject only to any provisions for bad debts appearing
in the 1999 Proforma Consolidated Balance Sheet of the Ducros Group.
11.2 - The necessary provisions have been made in the 1999 Proforma
Consolidated Balance Sheet of the Ducros Group to allow payment of
discounts, rebates or other advantages and temporary or annual
commitments granted by the companies of the Ducros Group until December
31, 1999.
ARTICLE 12 - BANK ACCOUNTS
Attached as EXHIBIT 8.A.12. are:
a) the list of bank accounts opened by the companies of the
Ducros Group and,
b) the list of individuals holding powers of attorney for said
accounts together with a summary statement of the terms
thereof.
ARTICLE 13 - INTELLECTUAL PROPERTY RIGHTS AND COMPUTER SOFTWARE
13.1 - EXHIBIT 8.A.13.1 lists and describes all of the Intellectual Property
Rights, with the exception of all general office software, entirely
owned by the companies of the Ducros Group, subject to any copyrights
for which there can be no exclusive rights or ownership of moral
rights.
13.1.1 EXHIBIT 8.A.13.1.1 lists all license agreements, with the exception of
all general office software, under which the companies of the Ducros
Group benefit from Intellectual Property Rights and all other
instruments and/or documents relating to such licenses.
13.1.2 EXHIBIT 8.A.13.1.2 lists all license agreements under which the
companies of the Ducros Group have licensed Intellectual Property
Rights to third parties and all other instruments and/or documents
relating to such licenses. Save as described in EXHIBIT 8.A.13.1.2, no
other licenses have been granted by any company of the Ducros Group in
respect of its Intellectual Property Rights.
13.2 The Intellectual Property Rights owned by the companies of the Ducros
Group and listed in EXHIBIT 18.A.13.1., are either duly registered or
duly filed and except as stated in EXHIBIT 8.A.13.1, such filings and
registrations have been maintained and/or been renewed with the
competent authorities and the relevant companies of the Ducros Group
are the legal and beneficial owners of them, free from all Liens.
The Ducros Group has taken all appropriate actions to preserve and
enforce its Intellectual Property rights except as set forth in EXHIBIT
18.A.13.1.
The companies of the Ducros Group do not use any Intellectual Property
Rights belonging to a third party other than those listed in EXHIBIT
8.A.13.1.1. The Activities of the Ducros Group have not at any time in
the last (5) five years, infringed (i) the Intellectual Property Rights
of any third party or (ii) any copyright. No know-how or processes used
by the companies of the Ducros Group infringe any third party rights.
13.3 - All computer software used by the companies of the Ducros Group is
currently licensed to them. The companies of the Ducros Group do not
use any software programs belonging to third parties without
authorization, and there are no third party claims in this regard.
Except as listed in EXHIBIT 8.A.13.3, the Intellectual Property Rights
and software programmes are fit for their purpose, and there has been
no defect or feature which may have adversely affected their
performance or the performance of any other software, hardware or
systems in the past 12 months.
13.4 - The Intellectual Property Rights listed in EXHIBIT 8.A.13.1 and in
EXHIBIT 8.A.13.1.1., represent all of the Intellectual Property Rights
and software programs necessary for the companies of the Ducros Group
to conduct their activities as they have been historically conducted,
except for those used to carry out the subcontracted activities.
13.5 - In the last five (5) years there have been no breaches of any license
agreement with respect to Intellectual Property Rights. Except as
listed in EXHIBIT 8.A.13.5, neither the
Intellectual Property Rights nor the license agreements will be
affected by the transactions contemplated herein.
ARTICLE 14 - INSURANCE
14.1 - A list of all principal insurance policies subscribed by the
companies of the Ducros Group or by EBS under its group policies is
attached as EXHIBIT 8.A.14.1.
14.2 - Except as set forth in EXHIBIT 8.A.14.2., these insurance policies
cover the risks that may affect the assets of the companies of the
Ducros Group sufficiently and under normal conditions, in accordance
with good commercial practice. Each company in the Ducros Group is
adequately covered against accident, third party, public liability,
product liability and other risks generally covered by insurance.
14.3 - Attached as EXHIBIT 8.A.14.3. is a list of insurance claims in excess
of 250,000 FRF (two hundred and fifty thousand French Francs) or its
exchange value in the currency of the country in which each of the
companies carries out is activities, on the date of the signing of this
Agreement, within the last two (2) fiscal years, and the amount of
indemnities paid by the insurance companies in relation to said claims.
14.4 - All premiums of the insurance policies as listed in EXHIBIT 8.A.14.1
have been paid by the companies of the Ducros Group and all obligations
set forth in the clauses of these policies have been fulfilled in all
material respects.
14.5 - The companies of the Ducros Group have not been informed by the
insurance companies of their intention to increase substantially the
amount of said premiums, to terminate the policies or not to renew them
and nothing has been done or omitted which would make any insurance
policy void or voidable or enable the insurers to void the same.
ARTICLE 15 - LOANS PAYABLE
15.1 - Attached as EXHIBIT 8.A.15.1.1. are a list and complete and accurate
copies of the middle-term and long-term loans and other credit
facilities, including repayable subsidies, that the companies of the
Ducros Group have subscribed, with an indication of the amount, term
and the securities pertaining to said loans and other credit
facilities.
Attached as EXHIBIT 8.A.15.1.2. are a list and complete and accurate
copies of the loans and other credit facilities granted by the
companies of the Ducros Group to third parties other than the companies
of the Ducros Group and, in particular, to their employees.
15.2 - These loans and credit facilities were duly subscribed. The companies
of the Ducros Group have complied with their contractual obligations
under said loans and credit facilities and these loans and credit
facilities are not subject to any claims except as set forth in Article
17 of this EXHIBIT 8.A.
Except as set forth in EXHIBIT 8.A.15.2., these loans payable or credit
facilities do not provide for any early repayment or acceleration
clauses ("REMBOURSEMENT ANTICIPE" or "DECHEANCE DU TERME") in the event
of a change in management or control in the companies of the Ducros
Group, or for any early repayment penalties.
15.3 Except as set forth in EXHIBIT 8.A.15.3.1., the companies of the Ducros
Group do not benefit from any debt write-off subject to a clause
governing the return to a more profitable financial situation ("CLAUSE
DE RETOUR A MEILLEURE FORTUNE") that might still be implemented.
Except as set forth in EXHIBIT 8.A.15.3.2. and the settlement of the
"INTERCO" accounts between the companies of the Ducros Group, on the
one hand, and CSF or the Affiliates of CFS on the other hand, the
companies of the Ducros Group are not subject to any demand for early
repayment of either their middle-term and long-term debts or credit
facilities received, and they did not make early repayments of any
loans or credit facilities during the 1999 fiscal year.
15.4 No company of the Ducros Group has received any grant, subsidy or other
financial concession which is liable to be refunded or varied as a
result of the change in the management or control of the Companies in
the Ducros Group.
ARTICLE 16 - ENVIRONMENT
16.1 - Except as set forth in EXHIBIT 8.A.16.1., the companies of the Ducros
Group have complied in all material respects with the applicable
environmental Laws concerning classified installations, pollution,
contamination or protection of the environment, the storage, labelling,
handling, release, treatment, manufacture, processing, deposit,
transportation or disposal of substances which may have a harmful
effect on the environment or the health of man or on any living
organism
Except as set forth in EXHIBIT 8.A.16.1., and except for fibro-cement
sheets present in certain buildings that contain a percentage of
asbestos, (it being specified that this percentage of asbestos complies
with all applicable regulations in force on the date of this
Agreement), the buildings owned by the companies of the Ducros Group or
leased by the companies of the Ducros Group, do not contain any
asbestos.
16.2 Except as set forth in EXHIBIT 8.A.16.2., the companies of the Ducros
Group are not legally required to perform work or have work performed
or to make capital expenditures in order to comply with any
environmental Laws relating to classified installations, pollution,
contamination or protection of the environment, the storage, labelling,
handling, release, treatment, manufacture, processing, deposit,
transportation or disposal of substances which may have a harmful
effect on the environment or the health of human beings or on any
living organism which would be in an annual amount higher than 250,000
FRF (two hundred and fifty thousand French Francs) in aggregate for the
Ducros Group, or its exchange value in the currency of the country in
which the
companies of the Ducros Group listed hereafter carry out an industrial
activity: Ducros (France), Xxxxxx XX (Spain), Dessert Products
International/ Malile, Ducros Margao, Alb Ducros.
16.3 - Except as set forth in EXHIBIT 8.A.16.3., no current or former
employees have made claims against the companies of the Ducros Group on
the basis of exposure to toxic substances in the performance of their
duties with the Companies, and, to the Sellers' Knowledge, no current
or former employee of the companies of the Ducros Group is undergoing
medical treatment due to exposure to any such substances during the
performance of their duties with the companies of the Ducros Group.
16.4 In the last five (5) years no discharge, release, leaching, emission or
escape into the environment of any such substance has occurred or is
occurring in the conduct of the current or any former businesses of any
of the companies of the Ducros Group or for which any of them may
otherwise be held liable nor do the Sellers have actual Knowledge that
any such event occurred in relation to any piece of land adjacent to
any of the pieces of land occupied by the Ducros Group.
16.5 The Sellers have produced to the Buyer full and accurate copies of all
environmental reports prepared in relation to the activities of the
Ducros Group during the last three (3) years.
ARTICLE 17 - LITIGATION
17.1 - Except as set forth in EXHIBIT 8.A.17.1., the companies of the Ducros
Group:
(a) are not parties to any judicial, administrative or arbitration
actions or criminal proceedings currently pending;
(b) to Sellers' Knowledge, there are no facts likely to be the
cause of such action.
17.2 - Except as set forth in EXHIBIT 8.A.17.2., there are no legal actions
currently pending or any facts likely to give rise to such actions,
that might result in the companies of the Ducros Group or any of the
Key Employees in his capacity as an employee, being sentenced to
criminal sanctions. Nor to the Sellers' Knowledge, are there any
matters that might give rise to, nor any serious threats of, any such
proceedings.
17.3 - The litigation in which the companies of the Ducros Group are
involved has been duly reserved in the 1999 Proforma Consolidated
Balance Sheet of the Ducros Group in accordance with French GAAP.
17.4 - The companies of the Ducros Group are not subject to any judgements
or orders not yet enforced that might have a significant negative
impact on their financial condition.
17.5 - Except as set forth in EXHIBIT 18.A.17.5, the companies of the Ducros
Group are not the subject of any official investigation or enquiry by
any administrative authority nor have they been informed that any such
investigation or enquiry may take place.
ARTICLE 18 - CUSTOMERS AND SUPPLIERS
18.1 - EXHIBIT 8.A.18.1 lists or contains, as the case may be, at the date
of signing of this Agreement, the (i) the twenty (20) largest customers
in terms of annual revenue before VAT of the Ducros Group and (ii) all
other customers of the Ducros Group which each purchase in excess of
five million French Francs (5,000,000 FRF) or its exchange value in the
currency of the country in which the companies carry out their
activities, (iii) together with complete copies of the current
contracts with the distribution chains ("CENTRALES D'ACHAT").
18.2 - Attached as EXHIBIT 8.A.18.2. is a list at the date of signature of
this Agreement of (i) the ten (10) largest suppliers in terms of costs
for each of Ducros and Ducros Distribution Benelux and (ii) any other
suppliers of the Ducros Group who generate individually revenues in
excess of five million French Francs before VAT (5,000,000 FRF) with
the Ducros Group or its exchange value in the currency of the country
in which the companies carry out their activities.
18.3 Except as set forth in EXHIBIT 8.A.18.3, to the Sellers' Knowledge,
none of the major customers or suppliers of any of the companies of the
Ducros Group intend to cease doing business with such companies, or to
reduce materially the amount of the business that it is presently doing
with such company. The Parties to the contract mentioned in paragraphs
8.A.18.1 and 8.A.18.2 have in all material respects carried out their
contractual obligations.
ARTICLE 19 - OTHER AGREEMENTS
19.1 - Attached as EXHIBIT 8.A.19.1. lists or contains, agreements other
than inter-company agreements and those which have not already been
listed in other Exhibits, true and complete copies or extracts of the
current contracts therefor:
a) service agreements or those entered into with subcontractors
representing individually (i) a financial commitment of the
companies of the Ducros Group in excess of three million
French Francs (3,000,000 FRF) and (ii) with a term in excess
of one (1) year;
b) contracts which (i) are onerous, and/or (ii) have a
non-compete clause, and/or (iii) have an exclusivity clause,
and/or (iv) are not entered into in the ordinary course of
business with a material impact on the companies of the Ducros
Group.
19.2 The agreements attached as EXHIBIT 8.A.18.1, 8.A.18.2 and 18.A.19.1, of
this EXHIBIT 8.A. were entered into by the companies of the Ducros
Group in the ordinary course of business, except those contracts
mentioned in Article 8.A.19.1.b)(i) and Article 8.A.19.1(b)(iv). They
are still in force and are not subject to any litigation, except as set
forth under litigation in EXHIBIT 8.A.17. All the parties to the
agreements listed in EXHIBIT 8.A.19.1 have complied in all material
respects with their contractual
obligations, the agreements are not voidable and, to the Sellers'
Knowledge, there is no event likely to result in the termination or a
substantial amendment to these agreements.
19.3 - Except as set forth in EXHIBIT 8.A.19.3., the agreements referred to
in Articles 18 and 19 of this EXHIBIT 8.A, do not contain any clauses
stipulating their early termination, any early payment, or any
amendment to their essential contractual provisions in the event of a
change in the control in the management or capital of the companies of
the Ducros Group.
19.4 - Except as set forth in EXHIBIT 8.A.19.4, no agreement to which any
member of the Ducros Group is a party violates or is registerable under
any competition Laws, nor to the Sellers' Knowledge has any member of
the Ducros Group received notice of any complaint or threat to make a
complaint in relation to such laws.
ARTICLE 20 - RELATIONSHIP OF THE SELLERS WITH THE COMPANIES OF THE DUCROS GROUP
Except as set forth in EXHIBIT 8.A.20., the companies of the Ducros
Group:
- are neither creditors nor debtors of the Sellers;
- do not use, free of charge or for a payment, any real property
belonging to the Sellers;
- have not granted the Sellers any special right over any of
their assets; and
- have not entered into any other written agreements with the
Sellers.
ARTICLE 21 - TAXATION - SOCIAL SECURITY - CUSTOMS DUTIES
21.1 - The companies of the Ducros Group have always complied with the Tax
Legislation.
21.2 - There are no outstanding Taxes due by the companies of the Ducros
Group. Adequate reserves have been made in the 1999 Proforma
Consolidated Balance Sheet for the Ducros Group in respect of all
future Taxes pertaining to the period prior to December 31, 1999.
21.3 - The companies of the Ducros Group have filed all declarations and
have complied with all the formalities required by the Tax Legislation
in the forms required and within the time limits provided for by the
Tax Legislation. They have provided the Tax Authorities, social
security agencies and any complementary agencies with all the
information necessary to determine the tax basis and the exact amount
of Taxes they owe as a result of their activities.
21.4 - Except as set forth in EXHIBIT 8.A.21.4., the companies of the Ducros
Group are not subject to any Tax audit in progress and have not
received any notification of
reassessment and, to the Sellers' Knowledge, have not been otherwise
informed (in writing or verbally) by a Tax Authority, social security
agency or by a additional agency of its intent to proceed with an
investigation liable to result in a reassessment of any kind
whatsoever.
21.5 - The companies of the Ducros Group benefit from the tax and social
benefits or other subsidies or other government subsidies set forth in
EXHIBIT 8.A.21.5.1. Except as set forth in EXHIBIT 8.A.21.5.2., the
companies of the Ducros Group have complied with all the obligations
attached to these tax and social benefits and subsidies or other
government subsidies. The tax credits (including any "AVOIR FISCAL")
have been used in accordance with the Tax Legislation. All tax credits,
tax losses reported in the tax returns are valid and may be taken
advantage of by the Ducros Group within the limits provided for in the
Tax Legislation.
21.6 - Except for the registration duties ("DROITS D'ENREGISTREMENT") and
the consequences of the termination of the "TAX INTEGRATION" with EBS,
the sale of the Shares shall not result (i) in any additional Tax
payable by the companies of the Ducros Group or (ii) the loss or
questioning of a tax benefit or of a particular tax treatment.
21.7 - Except as set forth in EXHIBIT 8.A.21.7., the companies of the Ducros
Group have paid all stamp duties, transfer taxes, contributions, costs
legally or contractually owed by the Companies for transactions
concerning the sale or contribution of securities or branch of activity
to which they were parties.
21.8 - Except as set forth in EXHIBIT 8.A.21.8., the companies of the Ducros
Group have not been granted any grace period, deferral or change in
levy due in relation to Tax on such transactions completed prior to the
Closing Date.
21.9 - The companies of the Ducros Group hold all the necessary documents
justifying the information entered in the declarations and formalities
set forth in Article 21.3 of this EXHIBIT 8.A., as well as the
decisions they made pursuant to the Tax Legislation.
21.10 - Except as set forth in EXHIBIT 8.A.21.10., the companies of the
Ducros Group have not, between January 1, 2000 up to and including the
date of signature of this Agreement:
(a) made, revoked, or changed any option relating to a Tax which
might, directly or indirectly, have unfavorable consequences
for the companies of the Ducros Group or the Buyer,
(b) renounced any limitation on the taxable base or the recovery
of any Tax owed if this might, directly or indirectly, have
unfavorable consequences for the companies of the Ducros Group
or the Buyer,
(c) entered into or modified any agreement or settlement with any
Tax Authority if this might, directly or indirectly, have
unfavorable consequences for the companies of the Ducros Group
or the Buyer.
ARTICLE 22 - LIABILITY RESULTING FROM PRODUCTS
Except as set forth in EXHIBIT 8.A.22.1., raw materials, packaging and finished
products of the companies of the Ducros Group comply, in all material respects,
with the regulations applicable to them and do not contain fully prohibited
hazardous substances.
The Products manufactured by the companies of the Ducros Group are free from any
hidden defects ("VICES CACHES"). No judicial or administrative actions alleging
the existence of any hidden defects in any of the products manufactured by the
companies of the Ducros Group is currently pending and, to the Sellers'
Knowledge, there are no grounds for such actions to be initiated.
Except as set forth in EXHIBIT 8.A.22.2, there have been no significant returns
of products supplied by the companies of the Ducros Group during the three (3)
years preceding the date of signature of this Agreement and no claims in respect
of personal injury or death arising from the use of Products so supplied during
such period.
ARTICLE 00 - XXXXXXXXXXXX XX XXX XXXX / X0X COMPLIANCE
The operations listed in EXHIBIT 8.A.23. have been undertaken and/or completed
by the companies of the Ducros Group in order to anticipate the introduction of
the Euro in France and in the other countries of the European Union that have
adopted the Euro and the arrival of the Year 2000.
ARTICLE 24 - SITUATION SINCE JANUARY 1, 2000 INCLUSIVE
24.1 Since January 1, 2000, up to and including the Closing Date, and except
as set forth in EXHIBIT 8.A.24., the Ducros Group has not carried out
any operations outside the scope of its current management and in
particular has not:
a) outside the ordinary course of business :
o granted, or promised to grant increases in salaries, bonuses,
or other compensation (differed or not), retirement insurance
pensions or other benefits to any employee or company agent or
proceeded with layoffs;
o sold an asset necessary to their activities without replacing
it or set up any Liens on Moveable Property or real property;
o subscribed any indebtedness in amounts which would not be
comparable to debts contracted in the past;
b) nor, in all cases:
o adopted any profit-sharing plan or increased the contributions
or the advantages provided for in such plans;
o entered into, terminated or made any change to (i) any
licensing agreement with respect to Intellectual Property or
(ii) any agreement or transaction involving a commitment on
their part of an amount exceeding five million French Francs
(5,000,000 FRF) in the aggregate or its exchange value on the
date of signature of such contract or transaction in the
currency of the country in which the company operates its
activities, or (iii) any agreement or arrangement with any
member of the Sellers' Group other than those already listed
in Article 4 of the Agreement;
o acquired the capital or a substantial percentage of the assets
of another company;
o amended their by-laws except as set forth in EXHIBIT 8.A.24.;
o paid any dividend or other distribution to their shareholders
except Ducros Guadeloupe;
o interrupted or suffered an interruption in its activities;
o made or suffered any material adverse change in the customer
or supplier relations of the Ducros Group subject to usual
negotiations with such customers or suppliers.
ARTICLE 25 - ACCURACY OF THE REPRESENTATIONS AND WARRANTIES AND EXHIBITS
The representations and warranties contained in this Agreement, as well as the
information in EXHIBITs attached hereto are, as of the date of this Agreement,
accurate, true and complete and will be so on the Closing Date subject to minor
changes, notified to and accepted by the Buyer before Closing, it being
specified that the Buyer shall not unreasonably refuse such minor changes. The
copies of the agreements attached as exhibits to EXHIBIT 8.A. are true and
complete.
The information, in particular the documents, facts, agreements, events, clearly
brought to the Buyer's attention in this Agreement and/or its EXHIBITs and/or in
the EXHIBITs of the representations and warranties of this EXHIBIT 8.A. shall
discharge CFS from any liability under the representations and warranties.
Notwithstanding the foregoing, the Sellers will not be discharged from their
liabilities (if any) with respect to those matters listed in EXHIBIT 9.1.2.3 of
the Agreement.
The information, namely documents, facts, agreements, events, clearly brought to
the Buyer's attention in an Exhibit may be applicable to other Exhibits or
Articles without requiring express cross references.
EXHIBIT 8 B
REPRESENTATIONS AND WARRANTIES
OF THE SODIS GROUP
ARTICLE 1 - CAPACITY OF EBS
1.1 - EBS has requisite powers and authority to enter into this Agreement
and the Related Agreements and to fulfill its respective obligations
incumbent upon it, particularly to sell the Sodis Shares.
1.2 - Except as provided for at Article 10 of the Agreement, the signing of
this Agreement and the Related Agreements by EBS and the closing of the
transactions contemplated herein:
a) are not subject to any prior authorization consultation or
approval by the management boards of EBS and Sodis, the
Workers Council of EBS or of Sodis, or administrative
authorities other than those that have already been obtained
and a copy of which was supplied to the Buyer pursuant to the
provisions of Article 5.2 of this Agreement; and except with
regards to approval by the Board of the Buyer as a new
shareholder of Sodis which shall be obtained before the
Closing Date, no other corporate action on the part of the
Sellers is necessary to authorise this Agreement or the
Closing of the transactions contemplated herein;
b) will not violate any of the clauses of the by-laws of EBS or
Sodis;
c) are not contrary to the provisions of any judicial or
administrative decision.
ARTICLE 2 - INCORPORATION OF THE COMPANIES OF THE SODIS GROUP
2.1 - The companies of the Sodis Group were duly incorporated and are duly
registered with the registry of commerce and companies. The secondary
establishments of the companies of the Sodis Group have also been duly
registered with the registry of commerce and companies.
2.2 - The by-laws of the companies of the Sodis Group have been filed at
the registry of commerce and companies and are complete, exact and up
to date.
2.3 - The companies of the Sodis Group are not subject to any proceedings
initiated on the basis of the prevention and amicable settlement of
corporate financial difficulties or any insolvency proceedings or legal
liquidation, and there are no grounds for these
companies to be subject to such proceedings. Each company of the Sodis
Group is solvent and able to pay its debts as they fall due.
The shareholders of the companies of the Sodis Group have not decided
to liquidate them, and the companies are not subject to any legal
decision ordering such liquidation.
2.4 - Except as set forth in EXHIBIT 8.B.2.4., the corporate bodies
("ORGANES SOCIAUX") of the companies of the Sodis Group were set up and
operate in accordance with the Laws applicable to them. The registers,
books and documents of these companies are held in accordance with
provisions of the Law and truly and accurately reflect the corporate
decisions made by these companies.
ARTICLE 3 - AUTHORIZATIONS AND OTHER PERMITS
3.1 - The companies of the Sodis Group have all the Authorizations
necessary to carry out their Activities as these are currently carried
out. These Authorizations are in full force.
3.2 - To the Sellers' Knowledge, there are no facts or events likely to
result in the withdrawal, suspension or questioning of said
Authorizations. The companies of the Sodis Group carry out their
activities in accordance with these Authorizations and all applicable
Laws.
ARTICLE 4 - CAPITAL STOCK
4.1 - For each of the companies of the Sodis Group, EXHIBIT 8.B.4.1
identifies, as of the date of this Agreement (i) the jurisdiction and
date of incorporation, (ii) the names of its directors or managers and
the date that their position is to be renewed, (iii) the share capital,
(iv) the number of shares, and (v) the names of all the shareholders as
well as the number and percentages of shares they own.
4.2 - The shares and equity interests ("PARTS SOCIALES") that make up all
the capital of the companies of the Sodis Group are the only
transferable securities issued by the companies of the Sodis Group. The
companies of the Sodis Group have not issued or promised to issue any
other securities of any type whatsoever, including but not limited to
investment certificates ("CERTIFICAT D'INVESTISSEMENT") and preferred
shares without voting rights ("ACTIONS PRIORITAIRES SANS DROIT DE
VOTE") or bonds ("OBLIGATIONS").
The companies of the Sodis Group have made no commitment concerning (i)
a capital increase, particularly through the issue of options or
convertible or exchangeable securities or (ii) other rights to acquire
or to offer shares, equity interests securities, bonds, Liens or other
rights over the share capital of any of the companies of the Sodis
Group.
From the Closing Date, the Buyer shall exercise all the rights attached
to the Sodis Shares, particularly the right to vote and the right to
receive all dividends.
4.3 - The shares and equity interests making up the capital of the
companies of the Sodis Group are validly issued and fully paid-up;
these shares and equity interests are freely transferable and there are
no other restrictions to their transferability other than those set
forth in this Agreement and those resulting from the Law or their
by-laws.
4.4 - The shares and equity interests of the companies of the Sodis Group
are free from any Liens.
ARTICLE 5 - EQUITY INTERESTS
5.1 - Except for their equity interests within the Sodis Group, the
companies of the Sodis Group do not, directly or indirectly, hold any
equity interest of any amount or kind whatsoever in any company or
legal entity, nor has any company of the Sodis Group any liability
arising out of any equity interest in any company or legal entity which
it no longer holds.
5.2 - The companies of the Sodis Group do not exercise any duties as legal
representatives of a company ("MANDATAIRES SOCIAUX") in another company
and are not likely to be qualified as a de facto manager of another
company or legal entity.
5.3 The companies of the Sodis Group are not party to any shareholders'
agreement or to any other agreement that deals with the management of a
company of the Sodis Group by a company which is not in the Sodis Group
or which aims to split all or part of the profits with a third party,
and they have not promised to enter into any such agreements.
ARTICLE 6 - FINANCIAL STATEMENTS
6.2 The 1999 Consolidated Accounts of the Sodis Group, which is attached in
EXHIBIT 1(f) of the Agreement, complies with the Laws and was prepared
in accordance with French GAAP. The 1999 Consolidated Accounts of the
Sodis Group are true and accurate and fairly present the financial
position, the income statement and the assets and liabilities of the
companies of the Sodis Group as of December 31, 1999, and show all
liabilities and off-balance sheet items.
6.2 The companies of the Sodis Group have no off-balance sheet commitments
nor any litigation at 31 December 1999, other than those mentioned in
the 1999 Consolidated Accounts of the Sodis Group.
6.3 The companies of the Sodis Group have not issued or promised to issue
any guarantees, securities or letters of comfort to guarantee
performance of third party obligations nor do
they have any unusual liabilities or other liabilities not arising in
the ordinary cause of business which are not recorded in the 1999
Consolidated Accounts of the Sodis Group.
6.6 The books and records of the Sodis Group properly reflect all
transactions of the Sodis Group in accordance with GAAP.
6.7 The Projected EBIT was prepared on the basis of future sales and
objectives for revenues and profits for the Ducros Group and for the
Sodis Group, which the Sellers estimated, at the time the amounts were
established and taking into account their experience, could reasonably
be achieved by the two groups subject to risks and uncertainties which
could affect them and which originate from outside factors, including
but not limited to, action taken by competitors, relationships with
clients, fluctuations in costs, availability of the chain of suppliers,
foreign economic conditions and fluctuations in the exchange rates.
It is expressly agreed that this representation is not a guaranty by
the Sellers that the objectives and results in the projected EBIT will
be achieved.
ARTICLE 7 - PERSONNEL OF THE COMPANIES OF THE SODIS GROUP
7.1 The lists of the employees of the companies of the Sodis Group as at
May 31, 2000, are attached as EXHIBIT 8.B.7.1.1. These lists set forth
the employer, name, title, nature of the term (either fixed or
indefinite) of their contract, their age, seniority, category and
classification, as necessary, as well as their remuneration, including
bonuses and benefits in-kind. They have not been significantly modified
since they were prepared.
The lists of employees on sabbatical leave, parental leave or on
long-term sick leave as at May 31, 2000, are attached as EXHIBIT
8.B.7.1.2.
None of the employment contracts of the companies of the Sodis Group
provide for a notice period or payment of compensation in excess of
that provided for by applicable Laws or the collective bargaining
agreement.
7.3 The list of Key Employees and legal representatives of the companies of
Sodis Group is attached as EXHIBIT 8.B.7.2.1.
To the Sellers' knowledge, none of the Key Employees has resigned or
threatened to resign. Mr. Herve Raoult has a verbal employment contract
with the company Paris Sud Distribution.
Except as set forth in EXHIBIT 8.B.7.2.3., the legal representatives of
the companies of the Sodis Group do not have any employment contracts
or service contracts granted to them by the companies of the Sodis
Group.
7.3 - The employment contracts have been executed by the companies of the
Sodis Group, taking into account the positions occupied by the
employees in accordance with their
contractual provisions, the collective bargaining agreements
("CONVENTIONS COLLECTIVES") and Laws, particularly those related to
wages, working hours, and to health and safety conditions, and the
companies of the Sodis Group are up to date with their obligations as
employers.
7.4 - EXHIBIT 8.B.7.4. sets forth the titles of the collective bargaining
agreements applicable to the companies of the Sodis Group.
7.5 - The companies of the Sodis Group are not subject to any legal decision
or settlement agreement providing for the rehiring of a former
employee.
7.6 - EXHIBIT 8.B.7.6. lists or contains copies of the investigations,
notices received from or reports prepared by Labor Inspectors and
received by the companies of the Sodis Group during the last three (3)
years as well as copies of the responses given by the companies of the
Sodis Group.
7.7 - The companies of the Sodis Group have not experienced any strikes or
other industrial action during the last two (2) years. To the Sellers'
Knowledge, there are not any serious threats of strikes or other
industrial action.
7.8 - A copy of the agreements related to working hours signed by the
companies of the Sodis Group is attached as EXHIBIT 8.B.7.8.
7.9 - EXHIBIT 8.B.7.9. sets forth the labor law proceedings (administrative
or judicial) currently pending to which the companies of the Sodis
Group are party. To the Sellers' Knowledge, there are no serious
threats that such proceedings which would justify recording a provision
in the accounts of the companies of the Sodis Group, are initiated
against the companies of the Sodis Group.
7.11. Save as disclosed in EXHIBIT 8.B.7.10, no company of the Sodis Group
makes or is required to make contributions to any pension, profit
sharing or other retirement plan, employee share ownership plan, bonus
or other incentive plan, contractual severance plan, health, death or
group insurance plan or similar plan agreement program or undertaking
("PLAN"). The companies of the Sodis Group have made all required
contributions under their respective Plans and paid all premium amounts
payable for all periods through and including the Closing Date, and
when required by French GAAP, adequate provisions have been made in the
1999 Consolidated Accounts of the Sodis Group.
ARTICLE 8 - FIXED ASSETS
8.1 - Attached as EXHIBIT 8.B.8.1. is the list of the real property owned
by the companies of the Sodis Group.
8.2 - The list of real property leased by the companies of the Sodis Group
is attached as EXHIBIT 8.B.8.2.. Except as set forth in EXHIBIT
8.B.8.4, no other leases or temporary leases ("convention d'occupation
precaire") have been signed by the companies of the Sodis Group.
The companies of the Sodis Group have not executed any financial leases
("CREDIT-BAIL") concerning real property.
These leases, temporary leases and financial leases are in force and
are not subject to any disputes or claims except as disclosed in
Article 14 of EXHIBIT 8.B. They do not contain any onerous provisions.
The companies of the Sodis Group have complied with the contractual
clauses of leases, temporary leases and financial leases and the
companies of the Sodis Group are up to date with respect to payment of
rents and occupation indemnities.
The companies of the Sodis Group have not received any notice ("CONGE")
or notice of termination of these agreements, and these agreements do
not provide any termination clause or right of variation in the event
of a change in control in the capital or management of the companies of
the Sodis Group.
8.3 - The buildings conform in all material respects, to the Laws and in
particular, the zoning and building ordinances and safety, hygiene and
labor rules applicable to them. The buildings are in a normal state of
repair and maintenance, taking into account their age and the quality
of materials generally used locally, and their current condition does
not require any major structural or other repair.
8.4 - The buildings are used exclusively by the companies of the Sodis
Group for the needs of their usual activities and make up all of the
buildings necessary for these activities, subject to subcontracting
activities. The buildings are suitable for the purposes for which they
are currently being used.
Except as set forth in EXHIBIT 8.B.8.4., the companies of the Sodis
Group have not granted any third party any rental agreements for the
buildings that belong to them or any sublease agreement for those which
they are leasing.
8.5 - Except as set forth in EXHIBIT 8.B.8.5., the companies of the Sodis
Group have not received any notification of any administrative or court
decision that might restrict or modify the use of the buildings by the
companies of the Sodis Group.
ARTICLE 9 - MOVEABLE PROPERTY OTHER THAN INVENTORIES
9.1 - Attached as EXHIBIT 8.B.9.1, is a list of the Moveable Property, as
at May 31, 2000, used by the companies of the Sodis Group. This
Moveable Property makes up all the Moveable Property necessary for the
normal course of the business of the companies of the Sodis Group.
There have been no material changes to the lists of Moveable Property
since this date.
9.2 - The companies listed above have full ownership of all the Moveable
Property, except those used under a financial lease ("CREDIT-BAIL") or
a lease agreement. The list of the lease or financial lease agreements
is attached as EXHIBIT 8.B.9.2.
9.3 - The Moveable Property is not subject to any Liens or any third-party
action to claim title.
9.4 - The Moveable Property is in a normal state of maintenance and repair
and operating conditions, subject to ordinary wear. It is fit for the
purposes for which it was intended and all the legal and regulatory
provisions applicable to it have been complied with.
9.5 - The lease and financial lease agreements pertaining to Moveable
Property are in force and are not subject to any disputes or claims
except as set forth in Article 14 of EXHIBIT 8.B. The companies of the
Sodis Group have complied, in all material respects, with the
contractual clauses of these agreements and they are up to date with
all payments.
The companies of the Sodis Group have not received any notification of
termination of these agreements, and these agreements do not provide
for any clause for termination or right of variation in the event of
any change in the control in the capital or management of the companies
of the Sodis Group.
ARTICLE 10 - RECEIVABLES - RESERVES
Reserves for receivables appearing in the 1999 Consolidated Accounts of the
Sodis Group have been made in accordance with GAAP. To the Sellers' Knowledge,
no receivable is subject to a counterclaim. All receivables are valid and
enforceable and, not being the object of a set-off except in the ordinary course
of business, have realised their nominal amount subject only to any provisions
for bad debts appearing in the 1999 Consolidated Accounts of the Sodis Group.
ARTICLE 11 - BANK ACCOUNTS
Attached as EXHIBIT 8.B.11. are:
a) the list of bank accounts opened by the companies of the Sodis
Group and,
b) the list of individuals holding powers of attorney for said
accounts together with a summary statement of the terms
thereof.
ARTICLE 12 - INSURANCE
12.1 - A list of all insurance policies subscribed by the companies of the
Sodis Group or by EBS under its group policies is attached as EXHIBIT
8.B.12.1.
12.2 - These insurance policies cover the risks that may affect the assets
of the companies of the Sodis Group sufficiently and under normal
conditions, in accordance with good commercial practice. Each company
in the Sodis Group is adequately covered against accident, third party,
public liability, product liability and other risks generally covered
by insurance.
12.3 - Attached as EXHIBIT 8.B.12.3. is a list of insurance claims in excess
of 250,000 FRF (two hundred and fifty thousand French Francs) within
the last two (2) fiscal years, and the amount of indemnities paid by
the insurance companies in relation to said claims.
12.4 - All insurance policy premiums as listed in EXHIBIT 8.B.12.1 have been
paid by the companies of the Sodis Group and all obligations set forth
in the clauses of these policies have been fulfilled in all material
respects.
12.5 - The companies of the Sodis Group have not been informed by the
insurance companies of their intention to increase substantially the
amount of said premiums, to terminate the policies or not to renew them
and nothing has been done or omitted which would make any policy of
insurance void or voidable or enable the insurers to void the same.
ARTICLE 13 - ENVIRONMENT
13.1 - The companies of the Sodis Group have complied in all material
respects with the applicable environmental Laws concerning classified
installations, pollution, contamination or protection of the
environment, the storage, labelling, handling, release, treatment,
manufacture, processing, deposit, transportation or disposal of
substances which may have a harmful effect on the environment or the
health of man or on any living organism.
Except for fibro-cement sheets present in certain buildings that
contain a percentage of asbestos, (it being specified that this
percentage of asbestos complies with all applicable regulations in
force on the date of this Agreement), the buildings leased by the
companies of the Sodis Group, do not contain any asbestos.
13.2 - The companies of the Sodis Group are not legally required to perform
work or have work performed or to make capital expenditures in order to
comply with any environmental Laws relating to classified
installations, pollution, contamination or
protection of the environment, the storage, labelling, handling,
release, treatment, manufacture, processing, deposit, transportation or
disposal of substances which may have a harmful effect on the
environment or the health of man or on any living organism which would
be in an annual amount higher than 250,000 FRF (two hundred and fifty
thousand French Francs) in aggregate for the Sodis Group.
13.3 - No current or former employees have made claims against the companies
of the Sodis Group on the basis of exposure to toxic substances as
aforesaid in the performance of their duties with the Companies, and,
to the Sellers' Knowledge, no current or former employee of the
companies of the Sodis Group is undergoing medical treatment due to
exposure to any such substances during the performance of their duties
with the companies of the Sodis Group.
13.4 In the last five (5) years no discharge, release, leaching, emission or
escape into the environment of any such substance has occurred or is
occurring in the conduct of the current or any former businesses of any
of the companies of the Sodis Group or for which any of them may
otherwise be held liable.
ARTICLE 14 - LITIGATION
14.1 - Except as set forth in EXHIBIT 8.B.14.1., the companies of the Sodis
Group:
(a) are not parties to any judicial, administrative or arbitration
actions or criminal proceedings currently pending;
(b) to Sellers' Knowledge, there are no facts likely to be the
cause of such action.
14.2 - Except as set forth in EXHIBIT 8.B.14.3., there are no legal actions
currently pending or any facts likely to give rise to such actions,
that might result in the companies of the Sodis Group or any of the Key
Employees in his capacity as an employee, being sentenced to criminal
penalties.
14.3 - The litigation in which the companies of the Sodis Group are involved
have been duly reserved in the 1999 Consolidated Accounts of the Sodis
Group in accordance with French GAAP.
14.4 - The companies of the Sodis Group are not subject to any judgements or
orders not yet enforced and that might have a significant negative
impact on their financial condition.
14.5 - Except as set forth in EXHIBIT 8.B.14.5, the companies of the Sodis
Group are not the subject of any official investigation or enquiry by
any administrative authority nor have they been informed that any such
investigation or enquiry may take place.
ARTICLE 15 - CONTRACTS
15.1 - Attached as EXHIBIT 8.B.15.1. lists and also contains true and
complete copies or extracts of the contracts entered into with Ducros
which have not already been listed in other EXHIBITs.
15.2 The agreements attached as EXHIBIT 8.B.15.1 were entered into by the
companies of the Sodis Group in the ordinary course of business are
still in force and are not subject to any litigation between the
parties. The parties to these agreements have complied in all material
respects with their contractual obligations, the agreements are not
voidable and, to the Sellers' Knowledge, there is no event likely to
result in the termination or a substantial amendment to these
agreements.
15.3 - The agreements referred to in this Article 19 do not contain any
clauses stipulating their early termination, any early payment, or any
amendment to their essential contractual provisions in the event of a
change in the control in the management or capital of the companies of
the Sodis Group.
15.4 - No agreement to which any member of the Sodis Group is a party
violates or is registerable under any competition Laws, nor to the
Sellers' Knowledge has any member of the Sodis Group received notice of
any complaint or threat to make a complaint in relation to such laws.
ARTICLE 16 - RELATIONSHIP OF THE SELLERS WITH THE COMPANIES OF THE SODIS GROUP
Except as set forth in EXHIBIT 8.B.16., the companies of the Sodis Group:
o are neither creditors nor debtors of the Sellers;
o do not use, free of charge or for a payment, any real property
belonging to the Sellers;
o have not granted the Sellers any special right over any of their
assets; and
o have not entered into any other written agreements with the Sellers.
ARTICLE 17 - TAXATION - SOCIAL SECURITY - CUSTOMS DUTIES
17.1 - The companies of the Sodis Group have always complied with the Tax
Legislation.
17.2 - There are no outstanding Taxes due by the companies of the Sodis
Group. Adequate reserves have been made in the 1999 Consolidated
Accounts for the Sodis Group in respect of all future Taxes pertaining
to the period prior to December 31, 1999.
17.3 - The companies of the Sodis Group have filed all declarations and have
complied with all the formalities required by the Tax Legislation in
the forms required and within the time limits provided for by the Tax
Legislation. They have provided the Tax Authorities,
social security agencies and any complementary agencies with all
the information necessary to determine the tax basis and the exact
amount of Taxes they owe as a result of their activities.
17.4 - Except as set forth in EXHIBIT 8.B.17.4., the companies of the Sodis
Group are not subject to any Tax audit in progress and have not
received any notification of reassessment and, to the Sellers'
Knowledge, have not been otherwise informed (in writing or verbally)
by a Tax Authority, social security agency or by an additional
agency of its intent to proceed with an investigation liable to
result in a reassessment of any kind whatsoever, nor are there any
matters which may give rise to any such investigation or
reassessment.
17.5 - The companies of the Sodis Group benefit from the tax and social
benefits or other subsidies or other government subsidies set forth in
EXHIBIT 8.B.17.5.1. Except as set forth in EXHIBIT 8.B.17.5.2., the
companies of the Sodis Group have complied with all the obligations
attached to these tax and social benefits and subsidies or other
government subsidies. The tax credits (including any "AVOIR FISCAL")
have been used in accordance with the Tax Legislation. All tax credits,
tax losses reported in the tax returns are valid and may be taken
advantage of by the Sodis Group within the limits provided for in the
Tax Legislation.
17.6 - Except for the registration duties ("DROITS D'ENREGISTREMENT") and
the consequences of the termination of the "TAX INTEGRATION" with EBS,
the sale of the Shares shall not result (i) in any additional Tax
payable by the companies of the Sodis Group or (ii) the loss or
questioning of a tax benefit or of a particular tax treatment.
17.7 - Except as set forth in EXHIBIT 8.B.17.7., the companies of the Sodis
Group have paid all stamp duties, transfer taxes, contributions, costs
legally or contractually owed by the Companies for transactions to
which they were parties such as a sale or contribution of securities or
branch of activity.
17.8 - Except as set forth in EXHIBIT 8.B.17.8., the companies of the Sodis
Group have not been granted any grace period, deferral or change in
levy due in relation to Tax on such transactions completed prior to the
Closing Date.
17.9 - The companies of the Sodis Group hold all the necessary documents
justifying the information entered in the declarations and formalities
set forth in Article 17.3 of this EXHIBIT 8.B., as well as the
decisions they made pursuant to the Tax Legislation.
17.10 - Except as set forth in EXHIBIT 8.B.17.10., the companies of the Sodis
Group have not, between January 1, 2000 up to and including the date of
signature of this Agreement:
(d) made, revoked, or changed any option relating to a Tax which might,
directly or indirectly, have unfavorable consequences for the
companies of the Sodis Group or the Buyer,
(e) renounced any limitation on the taxable base or the recovery of any
Tax owed if this might, directly or indirectly, have unfavorable
consequences for the companies of the Sodis Group or the Buyer,
(f) entered into or modified any agreement or settlement with any Tax
Authority if this might, directly or indirectly, have unfavorable
consequences for the companies of the Sodis Group or the Buyer.
ARTICLE 00 - XXXXXXXXXXXX XX XXX XXXX / X0X COMPLIANCE
The operations listed in EXHIBIT 8.B.18. have been undertaken and/or completed
by the companies of the Sodis Group in order to anticipate the introduction of
the Euro in France and in the other countries of the European Union that have
adopted the Euro and the arrival of the Year 2000.
ARTICLE 19 - SITUATION SINCE JANUARY 1, 2000 INCLUSIVE
19.1 Since January 1, 2000, up to and including the Closing Date, and except
as set forth in EXHIBIT 8.B.19., the Sodis Group has not carried out
any operations outside the scope of its current management and in
particular has not:
c) outside the ordinary course of business :
o granted, or promised to grant increases in salaries, bonuses,
or other compensation (differed or not), pensions or other
benefits to any employee or company agent or proceeded with
layoffs;
o sold an asset necessary to their activities without replacing
it or set up any Liens on Moveable Property or real property;
o subscribed any indebtedness in amounts which would not be
comparable to debts contracted in the past;
d) nor, in all cases:
o adopted any profit-sharing plan or increased the contributions
or the advantages provided for in such plans;
o entered into, terminated or made any change to (i) any
agreement or transaction involving a commitment on their part
in an amount exceeding five million French Francs (5,000,000
FRF) in the aggregate, or (ii) any agreement or arrangement
with any member of the Sellers other than those already listed
in Article 4 of the Agreement;
o acquired the capital or a substantial percentage of the assets
of another company;
o amended their by-laws except as set forth in EXHIBIT 8.B.2.4.;
o paid any dividend or other distribution to their shareholders;
o interrupted or suffered an interruption in its activities;
o made or suffered any material adverse change in its customer
or supplier relations subject to usual negotiations with such
customers or suppliers.
ARTICLE 20 - ACCURACY OF THE REPRESENTATIONS AND WARRANTIES AND EXHIBITS
The representations and warranties contained in this Agreement, as well as the
information in EXHIBITs attached hereto are, as of the date of this Agreement,
accurate, true and complete and will be so in all material aspects on the
Closing Date subject to minor changes, notified to and accepted by the Buyer
before Closing, it being specified that the Buyer shall not unreasonably refuse
such minor changes. The copies of the agreements attached as EXHIBITs to this
Agreement are true and complete.
The information, in particular the documents, facts, agreements, events, clearly
brought to the Buyer's attention in this Agreement and/or its EXHIBITs or in the
EXHIBITs of the Representations and Warranties given in EXHIBIT 8.B. shall to
such extent discharge EBS from any liability under the present representations
and warranties. Notwithstanding the foregoing, the Sellers will not be
discharged from their liabilities (if any) with respect to those matters listed
in EXHIBIT 9.1.2.3 of the Agreement.
The information, namely documents, facts, agreements, events, clearly brought to
the Buyer's attention in an EXHIBIT may be applicable to other EXHIBITs or
Articles without requiring express cross references.
