Exhibit 99.2
EXECUTION COPY
OFFER AND IMPLEMENTATION AGREEMENT
Between
Carnival Corporation
and
P&O Princess Cruises plc
Dated as of January 8, 2003
TABLE OF CONTENTS
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ARTICLE I Definitions ................................................................... 2
ARTICLE II Closing; Equalization Ratio ................................................... 9
2.1 Closing. ........................................................................... 9
2.2 Transactions to be Effected and Documents to be Exchanged .......................... 10
2.2.1 Equalization and Governance Agreement ..................................... 10
2.2.2 SVE Special Voting Deed ................................................... 10
2.2.3 Carnival Amendments ....................................................... 10
2.2.4 P&O Princess Amendments ................................................... 10
2.2.5 P&O Princess Special Share ................................................ 10
2.2.6 Issuance and Dividend of SVT Shares ....................................... 10
2.2.7 Carnival Special Share .................................................... 11
2.2.8 Mutual Directors .......................................................... 11
2.2.9 Officers .................................................................. 11
2.2.10 Deeds of Guarantee ........................................................ 11
2.2.11 Carnival Deed ............................................................. 11
2.2.12 Pairing Agreement ......................................................... 11
2.2.13 Other Documents ........................................................... 11
2.3 Equalization Ratio ................................................................. 11
ARTICLE III Representations and Warranties ................................................ 12
3.1 Representations and Warranties of Carnival and P&O Princess ........................ 12
3.1.1 Organization, Good Standing and Qualification ............................. 12
3.1.2 Capital Structure. ........................................................ 12
3.1.3 Corporate Authority; Approval and Fairness. ............................... 14
3.1.4 Governmental Filings; No Violations. ...................................... 14
3.1.5 Reports; Financial Statements. ............................................ 16
3.1.6 Absence of Certain Changes ................................................ 18
3.1.7 Litigation and Liabilities. ............................................... 18
3.1.8 Brokers and Finders ....................................................... 19
3.1.9 Ownership of Other Party's Common Stock. .................................. 19
3.1.10 Taxes ..................................................................... 20
3.1.11 Carnival Common Stock to be Issued in the Offer ........................... 20
ARTICLE IV Covenants ..................................................................... 20
4.1 Interim Operations ................................................................. 20
4.1.1 Ordinary Course ........................................................... 21
4.1.2 Governing Documents; Share Capital; Dividends ............................. 21
4.1.3 Issuance of Securities; Indebtedness; Acquisitions and Dispositions ....... 21
4.1.4 Employee Benefits ......................................................... 22
4.1.5 Representations and Warranties ............................................ 22
4.1.6 Non-Competition Agreements ................................................ 22
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4.1.7 Satisfaction of Closing Conditions .................................. 22
4.1.8 No Related Actions .................................................. 23
4.2 Acquisition Proposals. ....................................................... 23
4.2.1 No Shop ............................................................. 23
4.2.2 Notifications ....................................................... 24
4.2.3 Compliance with Exchange Act, Exchange Regulations and City Code .... 24
4.3 Information Supplied. ........................................................ 25
4.3.1 Shareholder Documents ............................................... 25
4.4 Shareholders Meetings ........................................................ 25
4.5 Filings; Other Actions; Notification. ........................................ 26
4.5.1 Filings ............................................................. 26
4.5.2 Mailing of Documents ................................................ 26
4.5.3 Cooperation ......................................................... 26
4.5.4 Furnishing Information .............................................. 27
4.5.5 Status .............................................................. 27
4.5.6 Consultation; Participation ......................................... 28
4.5.7 Cooperation in Defense of Claim ..................................... 28
4.6 Access ....................................................................... 28
4.7 Publicity .................................................................... 29
4.8 Benefits and Other Matters. .................................................. 29
4.8.1 Director and Officer Liability. ..................................... 29
4.8.2 Directors of Carnival and P&O Princess .............................. 30
4.8.3 Executive Officers .................................................. 30
4.9 Expenses ..................................................................... 30
4.10 Other Actions by Carnival and P&O Princess. .................................. 30
4.10.1 Dividends ........................................................... 30
4.10.2 Integration Planning ................................................ 31
4.11 Carnival Offer to Exchange ................................................... 31
4.11.1 Offer to Exchange ................................................... 31
4.11.2 Modification of the Offer, Fractional Shares ........................ 31
4.11.3 Expiration and Extension of the Offer Acceptance Period ............. 32
4.11.4 Acceptances by Carnival ............................................. 32
4.11.5 Schedule TO ......................................................... 32
4.11.6 P&O Princess Shareholder Information ................................ 32
4.11.7 Schedule 14D-9 ...................................................... 33
4.11.8 Termination of the Offer ............................................ 33
4.11.9 Adjustment of the Offer Exchange Ratio .............................. 33
ARTICLE V Conditions to the Closing ............................................... 33
5.1 Conditions to Each Party's Obligation to Effect the Closing .................. 33
5.1.1 Shareholder Approvals ............................................... 33
5.1.2 Regulatory Consents ................................................. 33
5.1.3 Laws and Orders ..................................................... 34
5.1.4 Carnival Amendments and P&O Princess Amendments ..................... 34
5.1.5 Approval of P&O Princess EGM Circular ............................... 34
5.1.6 Offer ............................................................... 34
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5.1.7 Registration Statements ............................................. 34
5.1.8 European Commission. ................................................ 34
5.1.9 NYSE Listing ........................................................ 35
5.2 Conditions to Obligations of P&O Princess to Effect the Closing .............. 35
5.2.1 Representations and Warranties of Carnival .......................... 35
5.2.2 Performance of Obligations of Carnival .............................. 35
5.2.3 Consents Under Agreements ........................................... 35
5.2.4 Carnival Special Share .............................................. 36
5.2.5 Other DLC Documents ................................................. 36
5.3 Conditions to Obligations of Carnival ........................................ 36
5.3.1 Representations and Warranties of P&O Princess ...................... 36
5.3.2 Performance of Obligations of P&O Princess .......................... 36
5.3.3 Consents Under Agreements ........................................... 36
5.3.4 P&O Princess Special Share .......................................... 37
5.3.5 Other DLC Documents ................................................. 37
5.3.6 Termination of Joint Venture Agreement .............................. 37
ARTICLE VI Termination ............................................................. 37
6.1 Termination by Mutual Consent ................................................ 37
6.2 Termination by Either P&O Princess or Carnival ............................... 37
6.3 Termination by Carnival ...................................................... 38
6.4 Termination by P&O Princess .................................................. 38
6.5 Effect of Termination and Abandonment. ....................................... 38
6.5.1 Effect of Termination ............................................... 38
6.5.2 Carnival Break Fee .................................................. 39
6.5.3 P&O Princess Break Fee .............................................. 39
ARTICLE VII Miscellaneous and General ............................................... 40
7.1 Survival ..................................................................... 40
7.2 Modification or Amendment .................................................... 40
7.3 Waiver of Conditions ......................................................... 40
7.4 Failure or Indulgence Not Waiver; Remedies Cumulative ........................ 40
7.5 Counterparts ................................................................. 41
7.6 GOVERNING LAW AND VENUE; WAIVER OF JURY TRIAL. ............................... 41
7.6.1 Governing Law And Venue ............................................. 41
7.6.2 WAIVER OF JURY TRIAL ................................................ 41
7.7 Notices ...................................................................... 42
7.8 Entire Agreement ............................................................. 43
7.9 Severability ................................................................. 44
7.10 Interpretation ............................................................... 44
7.11 Assignment ................................................................... 45
7.12 No Partnership ............................................................... 45
EXHIBIT A Agreed form of Equalization and Governance Agreement
EXHIBIT B Agreed form of SVE Special Voting Deed
EXHIBIT C Agreed form of Carnival Amended Articles
EXHIBIT D Agreed form of Carnival Amended By-Laws
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EXHIBIT E Agreed form of P&O Princess Amended Memorandum
EXHIBIT F Agreed form of P&O Princess Amended Articles
EXHIBIT G Agreed form of Carnival Deed of Guarantee
EXHIBIT H Agreed form of P&O Princess Deed of Guarantee
EXHIBIT I Agreed form of Carnival Deed
EXHIBIT J Directors of Carnival and P&O Princess
Annex 1 Offer Conditions
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OFFER AND IMPLEMENTATION AGREEMENT (hereinafter called this
"Agreement"), dated as of January 8, 2003, between Carnival Corporation, a
corporation organized under the laws of the Republic of Panama, having its
principal place of business at 0000 X.X. 00xx Xxxxxx, Xxxxx, XX 00000-0000
("Carnival"), and P&O Princess Cruises plc, a public limited company
incorporated in England and Wales (Registered No. 4039524) having its registered
office at 00 Xxx Xxxxxx Xxxxxx, Xxxxxx XX0X 0XX ("P&O Princess").
RECITALS
WHEREAS, on the terms and subject to the conditions provided herein
Carnival and P&O Princess (each, a "Party" and, together, the "Parties") intend
to establish a dual listed company structure for the purposes of conducting
their businesses together, treating their shareholders as if they owned an
interest in a combined enterprise and creating certain rights for the Carnival
Shareholders and the P&O Princess Shareholders in respect of their indirect
interests in the combined enterprise;
WHEREAS, on the terms and subject to the conditions herein, Carnival
also wishes to offer to P&O Princess shareholders the opportunity to exchange
their P&O Princess Ordinary Shares for shares of Carnival Common Stock, pursuant
to the Offer;
WHEREAS, the board of directors of each Party has determined that it
is in the best interest of their respective companies and shareholders to enter
into transactions (collectively, the "Transactions") contemplated by this
Agreement, including the Offer;
WHEREAS, in furtherance of such determination, the board of directors
of each Party has approved this Agreement and the Transactions, including,
(i) the execution and delivery by each of Carnival and P&O Princess
of an Equalization and Governance Agreement (the "Equalization and Governance
Agreement") in the Agreed Form,
(ii) (a) the issue by Carnival of one share of special voting stock
(the "Carnival Special Share") to a newly organized special purpose entity
wholly owned by an entity designated by P&O Princess and reasonably acceptable
to Carnival that is not an Affiliate of P&O Princess or Carnival (such special
purpose entity, the "Carnival SVC") and (b) the issue by P&O Princess of one
special voting share (the "P&O Princess Special Share"), to Carnival, which
shall immediately thereafter deposit (the "Deposit") the P&O Princess Special
Share with a trust company to be designated by Carnival and reasonably
acceptable to P&O Princess (the "P&O Princess Trustee"), in its capacity as
trustee of the P&O Princess Special Voting Trust (the "P&O Princess SVT"), a
trust to be formed under the P&O Princess Special Voting Trust Agreement, and in
each case (a) and (b), subject to the terms of a voting agreement (the "SVE
Special Voting Deed") in the Agreed Form,
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(iii) (a) the issue to Carnival by the P&O Princess Trustee, in
respect of the Deposit, of one share of beneficial interest in the P&O Princess
SVT (each, a "SVT Share") for each share of Carnival Common Stock outstanding on
the Closing Date, (b) the execution and delivery of the Pairing Agreement (the
"Pairing Agreement") between Carnival and the P&O Princess Trustee in the Agreed
Form and (c) the distribution by Carnival as a dividend to the holders of the
Carnival Common Stock of one SVT Share for each share of Carnival Common Stock;
(iv) the appointment or election of the same individuals as members
of the board of directors of Carnival and P&O Princess, and
(v) the implementation of the corporate governance arrangements
contained in the Agreed Form of the Carnival Amendments and the P&O Princess
Amendments;
WHEREAS, it is intended that this Agreement and the DLC Transactions
will not for any legal, tax or other purpose (i) alter the status of P&O
Princess and Carnival as separate independent entities, (ii) result in any of
Carnival, P&O Princess, their respective Subsidiaries, or their respective
shareholders being treated as creating an entity or otherwise entering into any
partnership, joint venture, association or agency relationship, or (iii) give
either Party (or its respective Subsidiaries or shareholders) any legal or
beneficial ownership interest in the assets or income of the other Party, and
shall not be construed as having such effect;
WHEREAS, as an inducement to P&O Princess' willingness to enter into
this Agreement and the Transactions, the Carnival Major Stockholders each
entered into a separate deed poll (respectively the "Arison Deed Poll", the "JMD
Delaware, Inc. Deed Poll" and the "JMD Protector, Inc. Deed Poll") covering the
shares of Carnival Common Stock listed in Exhibit A to each deed poll
(collectively the "Stockholders Deed Polls"); and
WHEREAS, Carnival and P&O Princess desire to make certain
representations, warranties, covenants and agreements in connection with this
Agreement.
NOW, THEREFORE, in consideration of the premises, and of the
representations, warranties, covenants and agreements contained herein, the
Parties agree as follows:
ARTICLE I
Definitions
"Affiliate" of any specified Person shall have the meaning assigned to
such term in Rule 12b-2 promulgated under the Exchange Act.
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"Agreed Form" means, with respect to any DLC Document, the form of
such DLC Document agreed by the Parties on or prior to the Closing; provided,
however, that the Agreed Form of the Equalization and Governance Agreement, the
Deeds of Guarantee, the SVE Special Voting Deed, the Carnival Amended Articles,
the Carnival Amended By-Laws, the P&O Princess Amended Memorandum, the P&O
Princess Amended Articles and the Carnival Deed shall be the forms attached to
this Agreement, together with such changes thereto as the Parties may agree
prior to the Closing.
"Business Day" means any day other than a Saturday, Sunday or day on
which banking institutions in The City of New York or London are authorized or
obligated by law or executive order to close in the United States or England (or
on which such banking institutions are open solely for trading in euros).
"Carnival Announcement" means Carnival's press release with respect to
a "Pre-conditional Carnival DLC proposal with Partial Share Offer for P&O
Princess" dated 24 October 2002.
"Carnival Common Stock" means the common stock, par value $0.01 per
share, of Carnival, excluding the Carnival Special Share.
"Carnival Circular" means the proxy statement/prospectus to be sent to
Carnival shareholders in connection with the DLC Transaction and the Carnival
Shareholders Meeting, as amended or supplemented, containing (i) a notice
convening the Carnival Shareholders Meeting, (ii) information relating to the
approval by Carnival shareholders of the Carnival Amendments, (iii) the
prospectus from the Second Joint Registration Statement, (iv) such other
information (if any) as may be required by the City Code, the Takeover Panel,
the SEC or the NYSE and (v) such other information as P&O Princess and Carnival
shall agree to include therein, and any supplements thereto and any other
circulars or documents issued to shareholders or employees of Carnival.
"Carnival Deed" means the deed between Carnival and P&O Princess in
the form attached to this Agreement as Exhibit I.
"Carnival Deed of Guarantee" means the guarantee whereby Carnival
agrees to guarantee certain obligations of P&O Princess for the benefit of
certain future creditors of P&O Princess, in the Agreed Form.
"Carnival Group" means Carnival, its subsidiaries and its subsidiary
undertakings.
"Carnival Major Stockholders" means Xxxxx Xxxxxx, JMD Delaware, Inc.
and JMD Protector, Inc.
"Carnival SVC Owner" means the legal and beneficial owner of all of
the shares in Carnival SVC, as mutually agreed by Carnival and P&O Princess.
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"City Code" means the United Kingdom City Code on Takeovers and
Mergers.
"Companies Act" means the Companies Xxx 0000 of the United Kingdom, as
amended.
"Compensation and Benefit Plans" means, with respect to Carnival or
P&O Princess, any bonus, deferred compensation, pension, retirement,
profit-sharing, thrift, savings, employee stock ownership, stock bonus, stock
purchase, restricted stock, stock option, employment, termination, severance,
compensation, medical, health or other plan, agreement, policy or arrangement
that covers employees, directors, former employees or former directors of it and
its Subsidiaries.
"Deeds of Guarantee" means each of the P&O Princess Deed of Guarantee
and the Carnival Deed of Guarantee.
"DLC Documents" means the Equalization and Governance Agreement, the
SVE Special Voting Deed, the Carnival Amended Articles, the Carnival Amended
By-Laws, the P&O Princess Amended Memorandum, the P&O Princess Amended Articles,
the Carnival SVC constituent documents, the P&O Princess SVT constituent
documents, the Deeds of Guarantee, the Carnival Deed, the Pairing Agreement and
any other document or instrument the parties agree is a DLC Document.
"DLC Transactions" means the Transactions other than those relating to
the Offer and other transactions incidental to the Offer.
"Exchange Act" means the United States Securities Exchange Act of
1934, as amended;
"Governmental Entity" means a court of competent jurisdiction or any
government or any governmental, regulatory, self-regulatory or administrative
authority, agency, commission, body or any other governmental entity and shall
include any relevant competition authorities, the Takeover Panel, the European
Commission, the London Stock Exchange, the UKLA, the U.S. Securities and
Exchange Commission and the NYSE.
"IRC" means the United States Internal Revenue Code of 1986, as
amended.
"Joint Registration Statement" means the joint registration statement
on Form S-4 and Form F-4 under the Securities Act relating to the Offer and the
deemed exchange of P&O Princess Ordinary Shares in connection with the DLC
Transaction, as amended or supplemented.
"Joint Venture Agreement" means the Joint Venture Agreement among P&O
Princess, Royal Caribbean Cruises Ltd. and JOEX Limited, dated as of November
19, 2001.
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"Law" means any law, statute, ordinance, rule, regulation, judgment,
order, injunction, decree, arbitration award, agency requirement, franchise,
license or permit of any Governmental Entity, including the City Code.
"Lien" shall mean any mortgage, pledge, lien, deed of trust,
hypothecation, claim, security interest, title defect, encumbrance, burden, tax
lien (as used in Section 6321 of the IRC or similarly by any state, local, or
foreign tax authority), charge, or other similar restriction, title retention
agreement, option, easement, covenant, encroachment or other adverse claim.
"London Listing Rules" means the listing rules of the UKLA.
"London Stock Exchange" means the London Stock Exchange plc.
"Material Adverse Change" means, with respect to any Party, any
change, effect, event or occurrence which has had or could reasonably be
expected to have a Material Adverse Effect with respect to such Party other than
any changes, effects, events or occurrences attributable to any one or more of
the following: (i) any changes after the date of this Agreement in generally
accepted accounting principles or interpretations thereof that applies to such
Party, (ii) the announcement and performance of this Agreement and compliance
with the covenants and obligations set forth herein, and (iii) the economy or
financial markets relevant to such Party in general or in general to the
industries in which such Party operates and not having a materially
disproportionate effect relative to the other Party on, such Party.
"Material Adverse Effect" means, with respect to any Party, a material
adverse effect on (i) the financial condition, results of operations, assets or
business of such Party and its Subsidiaries, taken as a whole, (ii) the ability
of such Party to perform without delay or restrictions its obligations under
this Agreement or the transactions contemplated on its part hereby or (iii) the
consummation or implementation of the Transactions.
"NYSE" means the New York Stock Exchange, Inc.
"Offer" means a partial offer to exchange up to 20% of the outstanding
P&O Princess Ordinary Shares (whether or not held in the form of P&O Princess
ADSs) as of the Effective Time for validly issued, fully paid and non-assessable
shares of Carnival Common Stock at the Offer Exchange Ratio as such offer may be
amended from time to time as permitted under this Agreement and by applicable
Law upon the terms and subject to the conditions set forth in this Agreement.
"Offer Documents" means the Schedule TO, the prospectus contained in
the Joint Registration Statement, the transmittal and acceptance documents, and
any other documents or information as may be required by the City Code, the
Takeover Panel, the UKLA, the NYSE, the SEC or London Stock Exchange in
connection with the Offer.
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"Offer Exchange Ratio" means 0.3004 shares of Carnival Common Stock
for each P&O Princess Ordinary Share.
"Person" means a natural person, a corporation, a limited liability
company, a general or limited partnership, a trust, an estate, a joint venture,
any Governmental Entity, or any other entity or organization.
"P&O Princess ADSs" means the American Depositary Shares of P&O
Princess, each of which represents four P&O Princess Ordinary Shares, which are
listed on the NYSE.
"P&O Princess Deed of Guarantee" means the guarantee whereby P&O
Princess agrees to guarantee certain obligations of Carnival for the benefit of
certain future creditors of Carnival, in the Agreed Form.
"P&O Princess EGM Circular" means the circular to be sent to P&O
Princess shareholders in connection with the P&O Princess Shareholders Meeting
to approve the DLC Transactions containing (i) a notice convening the P&O
Princess Shareholders Meeting, (ii) such other information (if any) as may be
required by the City Code, the Takeover Panel, the UKLA, the SEC, the NYSE or
the London Stock Exchange, (iii) all information required by applicable Law
relating to the DLC Transactions and (iv) such other information as P&O Princess
and Carnival shall agree to include therein, and any supplements thereto and any
other circulars or documents issued to shareholders or employees of P&O
Princess.
"P&O Princess Group" means P&O Princess, its subsidiaries and its
subsidiary undertakings.
"P&O Princess Ordinary Shares" means the ordinary shares (including
the Ordinary Shares underlying P&O Princess' American Depositary Shares) of P&O
Princess, excluding the P&O Princess Special Share.
"PGCL" means Law 32 of the Corporation Law of 1927 of the Republic of
Panama, as amended.
"Registration Statements" means the Joint Registration Statement and
the Second Joint Registration Statement.
"Schedule TO" means a Tender Offer Statement on Schedule TO
promulgated under the Exchange Act with respect to the Offer, as amended or
supplemented, which shall contain or incorporate by reference all or part of the
Joint Registration Statement.
"Second Joint Registration Statement" means the joint registration
statement on Form S-4 and Form F-4 under the Securities Act relating to the
deemed exchange of shares of Carnival Common Stock in connection with the DLC
Transaction
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and the registration of the P&O Princess Special Voting Share, as amended or
supplemented.
"Securities Act" means the United States Securities Act of 1933, as
amended.
"Shareholder Documents" means the P&O Princess EGM Circular, the Joint
Registration Statement and the Second Joint Registration Statement, including
the prospectuses constituting part of the Joint Registration Statement and the
Second Joint Registration Statement.
"Significant Subsidiary" of any specified Person shall have the
meaning assigned to such term in Rule 1-02(w) of the Regulation S-X promulgated
under the Exchange Act.
"Subsidiary" means, with respect to a Party, any entity, whether
incorporated or unincorporated, in which such Party owns, directly or
indirectly, a majority of the securities or other ownership interests having by
their terms ordinary voting power to elect a majority of the directors or other
persons performing similar functions, or the management and policies of which
such Party otherwise has the power to direct.
"Takeover Panel" means the UK Panel on Takeovers and Mergers.
"US GAAP" means United States generally accepted accounting
principles.
"UK GAAP" means United Kingdom generally accepted accounting
principles.
"UKLA" means the Financial Services Authority in its capacity as
competent authority for the purposes of Part VI of the UK Financial Services and
Markets Xxx 0000.
"Wider Carnival Group" means Carnival and any of its subsidiary
undertakings or any associated undertaking or company of which 20 per cent. or
more of the voting capital is held by the Carnival Group or any partnership,
joint venture, firm or company in which any member of the Carnival Group may be
interested.
"Wider P&O Princess Group" means P&O Princess and any of its
subsidiary undertakings or any associated undertaking or company of which 20 per
cent. or more of the voting capital is held by the P&O Princess Group or any
partnership, joint venture, firm or company in which any member of the P&O
Princess Group may be interested.
Each of the following terms is defined in the Section set forth
opposite such term:
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SCHEDULE OF DEFINED TERMS
Defined Term Section
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Acquisition Proposal ............................................. 4.2.1
Agreement ........................................................ Recitals
Arison Deed Poll ................................................. Recitals
Audit Date ....................................................... 3.1.5.2
Bankruptcy and Equity Exception .................................. 3.1.3.1
Carnival ......................................................... Recitals
Carnival Amended Articles ........................................ 2.2.3
Carnival Amended By-Laws ......................................... 2.2.3
Carnival Amendments .............................................. 2.2.3
Carnival Audit Date .............................................. 3.1.5.1
Carnival Disclosure Letter ....................................... 3.1
Carnival Officers ................................................ 3.1.7.1
Carnival Preferred Stock ......................................... 3.1.2.1
Carnival Reports ................................................. 3.1.5.1
Carnival Required Consents ....................................... 3.1.4.1
Carnival Requisite Vote .......................................... 3.1.3.1
Carnival Shareholders Meeting .................................... 4.4
Carnival Special Share ........................................... Recitals
Carnival SVC ..................................................... Recitals
Carnival Stock Plans ............................................. 3.1.2.1
Carnival Termination Amount ...................................... 6.5.2
Closing .......................................................... 2.1
Closing Date ..................................................... 2.1
Confidentiality Agreement ........................................ 4.6
Contracts ........................................................ 3.1.4.2
Deposit .......................................................... Recitals
Disclosure Letter ................................................ 3.1
Effective Time ................................................... 2.1
Equalization and Governance Agreement ............................ Recitals
Equalization Ratio ............................................... 2.3
Governmental Consents ............................................ 5.1.2
HSR Act .......................................................... 3.1.4.1
Indemnitees ...................................................... 4.8.1.2
Integration Committee ............................................ 4.10.2
JMD Delaware, Inc. Deed Poll ..................................... Recitals
JMD Protector, Inc. Deed Poll .................................... Recitals
Mutual Directors ................................................. 4.8.2
Offer Conditions ................................................. 4.11.1
Order ............................................................ 5.1.3
Pairing Agreement ................................................ Recitals
Parties .......................................................... Recitals
Party ............................................................ Recitals
Permits .......................................................... 3.1.7.2
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SCHEDULE OF DEFINED TERMS
Defined Term Section
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P&O Princess ..................................................... Recitals
P&O Princess Amended Articles .................................... 2.2.4
P&O Princess Amended Memorandum .................................. 2.2.4
P&O Princess Amendments .......................................... 2.2.4
P&O Princess Audit Date .......................................... 3.1.5.2
P&O Princess Disclosure Letter ................................... 3.1
P&O Princess Officers ............................................ 3.1.7.1
P&O Princess Option Plans ........................................ 3.1.2.2
P&O Princess Reports ............................................. 3.1.5.2
P&O Princess Required Consents ................................... 3.1.4.1
P&O Princess Requisite Vote ...................................... 3.1.3.2
P&O Princess Shareholders Meeting ................................ 4.4
P&O Princess Special Share ....................................... Recitals
P&O Princess SVT ................................................. Recitals
P&O Princess Termination Amount .................................. 6.5.3
P&O Princess Trustee ............................................. Recitals
P&O Princess UK Reports .......................................... 3.1.5.2
P&O Princess US Reports .......................................... 3.1.5.2
Qualifying Acquisition Proposal .................................. 4.2.1
Reports .......................................................... 3.1.5.2
Representatives .................................................. 4.2.1
Schedule 14D-9 ................................................... 4.11.7
SEC .............................................................. 3.1.5.1
Stockholders Deed Polls .......................................... Recitals
Superior Proposal ................................................ 4.2.1
SVE Special Voting Deed .......................................... Recitals
SVT Share ........................................................ Recitals
Tax .............................................................. 3.1.10
Tax Return ....................................................... 3.1.10
Termination Date ................................................. 6.2
Transactions ..................................................... Recitals
ARTICLE II
Closing; Equalization Ratio
2.1 Closing.
The closing and completion (the "Closing") of the DLC
Transactions shall take place simultaneously (i) at the offices of Xxxx, Weiss,
Rifkind, Xxxxxxx & Xxxxxxxx LLP, 0000 Xxxxxx xx xxx Xxxxxxxx, Xxx Xxxx, Xxx
Xxxx, 00000 and at the offices of Xxxxxxx Xxxxx, Exchange Square, Xxxxxxxx
Xxxxxx, Xxxxxx, XX0X 0XX, not later than the third Business Day after the first
day on which all of the conditions set forth in Article V
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are satisfied or waived by the Party or Parties entitled thereto in accordance
with this Agreement (other than those conditions that by their nature are to be
satisfied at the Closing, but subject to the satisfaction or waiver of such
conditions) or (ii) at such other places and time and/or on such other date as
Carnival and P&O Princess may agree in writing (the "Closing Date"). All
transactions to be effected at the Closing shall be effected simultaneously, and
no transaction shall be complete or effective until such time as all such
transactions are complete and effective (the "Effective Time").
2.2 Transactions to be Effected and Documents to be Exchanged. At or
prior to the Closing:
2.2.1 Equalization and Governance Agreement. Each of P&O Princess
and Carnival shall execute and deliver to the other the Equalization and
Governance Agreement in the Agreed Form;
2.2.2 SVE Special Voting Deed. Carnival, P&O Princess, Carnival
SVC, the P&O Princess Trustee and the Carnival SVC Owner shall execute and
deliver the SVE Special Voting Deed in the Agreed Form;
2.2.3 Carnival Amendments. The second amended and restated
articles of incorporation of Carnival shall be amended and restated in the
Agreed Form (the "Carnival Amended Articles") and shall be filed with the
Companies Registry of the Republic of Panama in accordance with the provisions
of the PGCL, and the amended and restated By-Laws of Carnival shall be amended
and restated in the Agreed Form (the "Carnival Amended By-Laws" and,
collectively with the Carnival Amended Articles, the "Carnival Amendments"), and
shall become effective;
2.2.4 P&O Princess Amendments. An amendment to each of the
memorandum and articles of association of P&O Princess, in the Agreed Form (such
memorandum as so amended, the "P&O Princess Amended Memorandum", such articles,
as so amended, the "P&O Princess Amended Articles" and, collectively with the
P&O Princess Amended Memorandum, the "P&O Princess Amendments") shall become
effective;
2.2.5 P&O Princess Special Share. P&O Princess shall issue and
allot the P&O Princess Special Share to Carnival, which shall make the Deposit.
P&O Princess shall register the P&O Princess Trustee as the holder of the P&O
Princess Special Share and issue a share certificate or holding statement for
the P&O Princess Special Share to the P&O Princess Trustee;
2.2.6 Issuance and Dividend of SVT Shares. The P&O Princess
Trustee shall issue to Carnival, in respect of the Deposit, one SVT Share for
each share of Carnival Common Stock outstanding as of the Closing Date, and
Carnival shall distribute, as a dividend to holders of Carnival Common Stock,
one SVT Share for each share of Carnival Common Stock;
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2.2.7 Carnival Special Share. Carnival shall issue the Carnival
Special Share to Carnival SVC, register Carnival SVC as the holder of the
Carnival Special Share and issue a share certificate or a book statement for the
Carnival Special Share to Carnival SVC;
2.2.8 Mutual Directors. To the extent that they are not already
effective, (i) the appointment or election of the Mutual Directors designated
pursuant to Section 4.8.2 as directors of each of Carnival and P&O Princess,
comprising the entire board of directors of each of Carnival and P&O Princess,
shall become effective, and (ii) the resignation of each director of Carnival or
P&O Princess who is not designated as a Mutual Director shall become effective;
2.2.9 Officers. The appointment or election of the individuals
identified as officers pursuant to Section 4.8.3 as officers of each of Carnival
and P&O Princess shall become effective;
2.2.10 Deeds of Guarantee. Each Party shall execute and deliver
to the other the Deeds of Guarantee;
2.2.11 Carnival Deed. Carnival shall execute and deliver the
Carnival Deed;
2.2.12 Pairing Agreement. Carnival and the P&O Princess Trustee
shall execute and deliver the Pairing Agreement; and
2.2.13 Other Documents. Each Party shall deliver to the other
such other documents, instruments and certificates as the other Party may
reasonably request in connection with the Transactions and the Closing.
2.3 Equalization Ratio. Subject to adjustment as set forth below in
this Section 2.3, the Equalization Ratio to be set forth in the Equalization and
Governance Agreement shall, as of the Effective Time, be one P&O Princess
Ordinary Share to 0.3004 of a share of Carnival Common Stock, such that the
voting rights and the rights to distributions (of income and capital) of one P&O
Princess Ordinary Share shall be equivalent to the voting rights and the rights
to distributions of 0.3004 of a share of Carnival Common Stock.
If the Parties agree that the Equalization Ratio shall instead be 1:1, then they
shall make such subdivisions and/or combinations of Carnival Common Stock and/or
P&O Princess Ordinary Shares, or other such actions, as they mutually agree are
necessary to achieve that result. In either case, the Equalization Ratio (i)
shall be adjusted, in the manner provided in the Equalization and Governance
Agreement, for all actions occurring on or after the date hereof and at or
before the Effective Time that would require an automatic adjustment to the
Equalization Ratio pursuant to the terms of the Equalization and Governance
Agreement as if such agreement were effective during such period, and (ii)
subject to any such adjustment, shall be the Equalization Ratio as of the
Effective Time; provided, however, that the Equalization Ratio shall not be
adjusted for regular
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dividends declared prior to the Effective Time and permitted pursuant to Section
4.1.2. Such Equalization Ratio, as so adjusted from time to time, is referred to
herein as the "Equalization Ratio".
ARTICLE III
Representations and Warranties
3.1 Representations and Warranties of Carnival and P&O Princess.
Except as set forth in the corresponding sections or subsections of the
disclosure letter, dated the date hereof and signed by an authorized officer,
delivered by Carnival to P&O Princess or by P&O Princess to Carnival (each a
"Disclosure Letter" and the "Carnival Disclosure Letter" and the "P&O Princess
Disclosure Letter", respectively), as the case may be, Carnival (except for
subparagraphs 3.1.2.2, 3.1.3.2, 3.1.5.2, 3.1.8(ii), and 3.1.9.2 below and
references in Section 3.1.1 below to documents made available by P&O Princess to
Carnival) hereby represents and warrants to P&O Princess, and P&O Princess
(except for subparagraphs 3.1.2.1, 3.1.3.1, 3.1.5.1, 3.1.8(i), and 3.1.9.1 below
and references in Section 3.1.1 below to documents made available by Carnival to
P&O Princess), hereby represents and warrants to Carnival, that:
3.1.1 Organization, Good Standing and Qualification. Each of it
and its Significant Subsidiaries is a corporation or other organization duly
organized, validly existing and in good standing (with respect to jurisdictions
that recognize the concept of good standing) under the laws of its respective
jurisdiction of incorporation or organization and has all requisite corporate or
similar power and authority, and has been duly authorized by all necessary
approvals and orders, to own, operate and lease its properties and assets and to
carry on its business as presently conducted and is duly qualified to do
business and is in good standing in each jurisdiction where the ownership,
operation or leasing of its assets or properties or conduct of its business
requires such qualification, except for any such failures to be so organized,
qualified or in good standing, or to have such power or authority, which,
individually or in the aggregate, have not had and are not reasonably likely to
have a Material Adverse Effect with respect to it. Carnival has made available
to P&O Princess complete and correct copies of its articles of incorporation and
by-laws, and P&O Princess has made available to Carnival complete and correct
copies of its memorandum and articles of association, in all cases as amended to
date. Such articles of incorporation and by-laws or memorandum and articles of
association, as the case may be, as so made available are in full force and
effect.
3.1.2 Capital Structure.
3.1.2.1 The authorized capital stock of Carnival consists
of 960,000,000 shares of Carnival Common Stock, of which 586,837,283 shares were
issued and outstanding as of the close of business on January 3, 2003, and
40,000,000 shares of Preferred Stock, par value $0.01 per share ("Carnival
Preferred Stock") none of which is outstanding as of the date hereof. All of the
outstanding shares of Carnival Common Stock have been duly authorized and
validly issued and are paid and non-assessable.
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Carnival has no shares of Carnival Common Stock or Carnival Preferred Stock
reserved for or otherwise subject to issuance, except that as of the close of
business on January 3, 2003, there were no more than 56,570,829 shares of
Carnival Common Stock subject to issuance pursuant to the plans of Carnival
identified in paragraph 3.1.2.1 of the Carnival Disclosure Letter as being the
only Compensation and Benefit Plans or agreements pursuant to which Carnival
Common Stock may be issued (the "Carnival Stock Plans"). Each of the outstanding
shares of capital stock or other ownership interests of each of Carnival's
Significant Subsidiaries is duly authorized, validly issued, fully paid and
non-assessable and owned by Carnival or a direct or indirect wholly owned
Subsidiary of Carnival, in each case free and clear of any Lien. Except as set
forth above or as contemplated by this Agreement, there are no preemptive or
other outstanding rights, options, warrants, conversion rights, stock
appreciation rights, redemption rights, repurchase rights, agreements,
arrangements, calls, commitments or rights of any kind which obligate Carnival
or any of its Subsidiaries to issue or sell any shares of capital stock or other
securities of Carnival or any of its Subsidiaries or any securities or
obligations convertible or exchangeable into or exercisable for, or giving any
Person a right to subscribe for or acquire from Carnival or any of its
Subsidiaries, any securities of Carnival or any of its Subsidiaries, and no
securities or obligations evidencing such rights are authorized, issued or
outstanding. Except as described in the Carnival Disclosure Letter, Carnival
does not have outstanding any bonds, debentures, notes or other obligations the
holders of which have the right to vote (or which are convertible into or
exercisable for securities having the right to vote) with the shareholders of
Carnival on any matter.
3.1.2.2 The authorized share capital of P&O Princess is
$375 million divided into 750,000,000 P&O Princess Ordinary Shares. As of the
close of business on January 7, 2003, the allotted and issued share capital of
P&O Princess consisted of 693,596,865 P&O Princess Ordinary Shares. All of those
P&O Princess Ordinary Shares have been duly authorized and validly issued and
are fully paid or credited as fully paid. P&O Princess has no P&O Princess
Ordinary Shares reserved for or otherwise subject to issuance, except that, as
of the close of business on January 7, 2003, there were no more than 10,000,000
P&O Princess Ordinary Shares and no more than 2,000,000 P&O Princess ADSs
subject to issuance pursuant to the plans of P&O Princess identified in
subparagraph 3.1.2.2 of the P&O Princess Disclosure Letter as being the only
Compensation and Benefit Plans or agreements pursuant to which P&O Princess
Ordinary Shares may be issued (the "P&O Princess Option Plans"). Each of the
outstanding shares of capital stock or other ownership interests of each of P&O
Princess' Significant Subsidiaries is duly authorized, validly issued, fully
paid and non-assessable and owned by P&O Princess or a direct or indirect wholly
owned Subsidiary of P&O Princess, in each case free and clear of any Lien.
Except as set forth above or as contemplated by this Agreement, there are no
preemptive or other outstanding rights, options, warrants, conversion rights,
stock appreciation rights, redemption rights, repurchase rights, agreements,
arrangements, calls, commitments or rights of any kind which obligate P&O
Princess or any of its Subsidiaries to issue or to sell any shares of capital
stock or other securities of P&O Princess or any of its Subsidiaries or any
securities or obligations convertible or exchangeable into or exercisable for,
or giving any Person a right to subscribe for or acquire from P&O Princess or
any of its Subsidiaries,
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any securities of P&O Princess or any of its Subsidiaries, and no securities or
obligations evidencing such rights are authorized, issued or outstanding. P&O
Princess does not have outstanding any bonds, debentures, notes or other
obligations the holders of which have the right to vote (or which are
convertible into or exercisable for securities having the right to vote) with
the shareholders of P&O Princess on any matter.
3.1.3 Corporate Authority; Approval and Fairness.
3.1.3.1 Carnival has all requisite corporate power and
authority and has taken all corporate action necessary in order to authorize,
execute, deliver and perform its obligations under this Agreement and to
consummate the Transactions, subject only to the approval of the Transactions
(including the Carnival Amendments by the vote of the holders of not less than
50% of the outstanding shares of Carnival Common Stock entitled to vote thereon
(the "Carnival Requisite Vote"). Assuming the due authorization, execution and
delivery of this Agreement by each party thereto other than Carnival or any of
its Subsidiaries, this Agreement constitutes, and at the Effective Time each DLC
Document to which Carnival will be or is a party will constitute, a valid and
binding agreement of Carnival enforceable against Carnival in accordance with
its terms, subject to bankruptcy, insolvency, fraudulent transfer,
reorganization, moratorium and similar laws of general applicability relating to
or affecting creditors' rights and to general equity principles (the "Bankruptcy
and Equity Exception"). The Board of Directors of Carnival has approved this
Agreement (including the Exhibits hereto) and the Transactions.
3.1.3.2 P&O Princess has all requisite corporate power
and authority and has taken all corporate action necessary in order to
authorize, execute, deliver and perform its obligations under this Agreement and
to consummate the Transactions, subject only to the approval of the Transactions
(including the P&O Princess Amendments) by, on a show of hands, not less than
75% of the holders of the outstanding P&O Princess Ordinary Shares present in
person or, on a poll, by the holders of not less than 75% of the votes attaching
to the P&O Princess Ordinary Shares who vote in person or by proxy at the P&O
Princess Shareholders Meeting at which a quorum is present and acting throughout
(the "P&O Princess Requisite Vote"). Assuming the due authorization, execution
and delivery of this Agreement by each party thereto other than P&O Princess or
any of its Subsidiaries, this Agreement constitutes, and at the Effective Time
each DLC Document to which P&O Princess will be or is a party will constitute, a
valid and binding agreement of P&O Princess, enforceable against P&O Princess in
accordance with its terms, subject to the Bankruptcy and Equity Exception. The
Board of Directors of P&O Princess (A) has approved this Agreement (including
the Exhibits hereto), and the Transactions and (B) has received the advice of
its financial advisor, Xxxxxxxx Xxxxxxx Xxxxx Xxxxxx, to the effect that, as of
the date of this Agreement, the terms of the DLC Transactions are fair and
reasonable.
3.1.4 Governmental Filings; No Violations.
3.1.4.1 Other than the filings, consents, notices,
approvals, confirmations, declarations and/or decisions listed in Section
3.1.4.1 of each Party's
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Disclosure Letter (all such filings, consents, notices, approvals,
confirmations, declarations and/or decisions to be made, given or obtained by
Carnival being the "Carnival Required Consents", and by P&O Princess being the
"P&O Princess Required Consents") no filings, notices, approvals, confirmations,
and/or declarations are required to be made by it or any of its Subsidiaries
with, nor are any approvals, consents or other confirmations required to be
obtained by it or any of its Subsidiaries from, any Governmental Entity, in
connection with the execution and delivery by it of this Agreement and the
consummation by it of the Transactions, except those the failure of which to
make, give or obtain, individually or in the aggregate, is not reasonably likely
to have a Material Adverse Effect with respect to it.
3.1.4.2 The execution, delivery and performance of this
Agreement by it does not, and the consummation by it of the Transactions will
not, constitute or result in (A) a breach or violation of, or a default under,
its articles of incorporation or by-laws, in the case of Carnival, or memorandum
or articles of association, in the case of P&O Princess, or the comparable
governing instruments of any of the Significant Subsidiaries of Carnival and P&O
Princess, (B) subject to making, giving or obtaining all Carnival Required
Consents or P&O Princess Required Consents, as applicable, and all other
necessary third-party consents as set forth in Section 3.1.4.2 of its Disclosure
Letter, a breach or violation of, or a default under, or the termination,
amendment, cancellation or acceleration of any obligations or penalties or the
creation of a Lien, charge, "put" or "call" right, right of purchase or other
encumbrance on the assets of it or any of its Subsidiaries (with or without
notice, lapse of time or both) pursuant to any agreement, lease, license,
insurance contract, contract, note, mortgage, loan, indenture, arrangement
(including, without limitation, any financing arrangement) or other obligation
("Contracts") binding upon it or any of its Subsidiaries or any Law or
governmental or non-governmental permit or license to which it or any of its
Subsidiaries is or any of its or their assets is subject or bound, (C) any
change in the rights or obligations of either Party under any of its Contracts,
or (D) any employee of it or its Subsidiaries being entitled to severance pay
under, acceleration of the time of payment or vesting or triggering of any
payment of compensation or benefits under, increasing the amount payable or
triggering of any other obligation pursuant to, any of the Compensation and
Benefit Plans involving in any such case an amount or value greater than $2.5
million for any individual or $10 million in the aggregate or any breach or
violation of, or a default under, any of the Compensation and Benefit Plans,
except, in the case of clause (B) or (C) above, for any breach, violation,
default, termination, amendment, cancellation, acceleration, creation or change
that, individually or in the aggregate, is not reasonably likely to have a
Material Adverse Effect with respect to it. Neither Party nor any of its
Subsidiaries is in violation of, or default under, or with the lapse of time or
giving of notice or both would be in violation of, or default under, any
provision of any agreement, instrument or arrangement pursuant to which it has
borrowed money or otherwise incurred indebtedness where the resulting
acceleration of all the borrowed money or indebtedness under all such
agreements, instruments and arrangements would be greater than $100 million.
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3.1.5 Reports; Financial Statements.
3.1.5.1 Carnival has made available to P&O Princess
copies of (A) each registration statement, report, or other document prepared by
it or its Subsidiaries and filed with the United States Securities and Exchange
Commission (the "SEC") since November 30, 2001 (the "Carnival Audit Date"),
including Carnival's Annual Report on Form 10-K for the year ended November 30,
2001 and Quarterly Reports on Form 10-Q for the quarters ended February 28,
2002, May 31, 2002 and August 31, 2002, each in the form (including exhibits,
annexes and any amendments thereto) filed with the SEC (collectively, including
any such registration statement, report, or other document filed with the SEC
subsequent to the date hereof, the "Carnival Reports") and (B) all circulars,
reports and other documents distributed by Carnival to its shareholders since
the Carnival Audit Date (it being understood that all documents filed with the
SEC shall be deemed to have been made available for purposes of this Section
3.1.5.1). As of their respective dates, the Carnival Reports did not, and any
Carnival Reports filed with the SEC subsequent to the date hereof will not,
contain any untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements made therein,
in the light of the circumstances under which they were made, not misleading.
Each of the consolidated balance sheets included in or incorporated by reference
into the Carnival Reports (including the related notes and schedules) fairly
presents, or in the case of those filed with the SEC after the date hereof will
fairly present, in all material respects, the consolidated financial position of
Carnival and its Subsidiaries as of its date and each of the related
consolidated statements of operations, shareholders' equity and cash flows
included in or incorporated by reference into the Carnival Reports (including
any related notes and schedules) fairly presents, or in the case of those filed
with the SEC after the date hereof will fairly present, in all material
respects, the consolidated results of operations, retained earnings and changes
in cash flows, as the case may be, of Carnival and its consolidated Subsidiaries
for the periods set forth therein (subject, in the case of unaudited statements,
to notes and normal year-end audit adjustments that are not expected to be
material in amount or effect), in each case in accordance with US GAAP
consistently applied during the periods involved except as may be noted therein.
All of the Carnival Reports, as of their respective dates (and as of the date of
any amendment to the respective Carnival Report), complied, or in the case of
those filed with the SEC after the date hereof will comply, as to form in all
material respects with the applicable requirements of the Securities Act and the
Exchange Act. Except as disclosed in the Carnival Reports filed prior to the
date hereof, Carnival and its consolidated Subsidiaries have not incurred any
liabilities that are of a nature that would be required to be disclosed on a
balance sheet of Carnival and its consolidated Subsidiaries or the footnotes
thereto prepared in conformity with US GAAP, other than (A) liabilities incurred
in the ordinary course of business consistent with past practice, (B)
liabilities incurred in accordance with Section 4.1, (C) liabilities for Taxes
in respect of income, profits or gains earned in the ordinary course of business
or (D) liabilities that, individually or in the aggregate, have not had and are
not reasonably likely to have a Material Adverse Effect with respect to
Carnival.
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3.1.5.2 P&O Princess has made available to Carnival
copies of (A) each registration statement, report or other document prepared by
it or its Subsidiaries and filed with, or furnished to, the SEC since December
31, 2001 (the "P&O Princess Audit Date", with the P&O Princess Audit Date and
the Carnival Audit Date each being referred to herein as the relevant Party's
"Audit Date"), including P&O Princess' Annual Report on Form 20-F for the year
ended December 31, 2001 and interim financial Reports on Form 6-K for the
quarters ended March 31, 2002, June 30, 2002 and September 30, 2002, each in the
form (including exhibits, annexes and any amendments thereto) filed with, or
furnished to, the SEC (collectively, including any such registration statement,
report or other document filed with, or furnished to, the SEC subsequent to the
date hereof, the "P&O Princess US Reports"); and (B) all circulars, reports and
other documents distributed by P&O Princess to its shareholders since the P&O
Princess Audit Date (it being understood that all documents filed with the SEC
shall be deemed to have been made available for purposes of this Section
3.1.5.2). As of their respective dates, the P&O Princess US Reports did not, and
any P&O Princess US Report filed with, or furnished to, the SEC subsequent to
the date hereof will not, contain any untrue statement of a material fact or
omit to state a material fact required to be stated therein or necessary to make
the statements made therein, in the light of the circumstances under which they
were made, not misleading. All of the P&O Princess US Reports, as of their
respective dates (and as of the date of any amendment to the respective P&O
Princess US Reports), complied, or in the case of those filed with, or furnished
to, the SEC after the date hereof will comply, as to form in all material
respects with the applicable requirements of the Securities Act and the Exchange
Act. All documents notified by P&O Princess to, or filed by P&O Princess with,
the UKLA since the P&O Princess Audit Date, including any documents notified by
P&O Princess to, or filed by P&O Princess with, the UKLA subsequent to the date
hereof (the "P&O Princess UK Reports", collectively with the P&O Princess US
Reports, the "P&O Princess Reports", with the Carnival Reports and the P&O
Princess Reports each being referred to as the relevant Party's "Reports")
complied, or in the case of those notified or filed by P&O Princess subsequent
to the date hereof will comply, as to form, in all material respects with the
applicable provisions, of the London Listing Rules and the Companies Act. As of
their respective dates, the P&O Princess UK Reports did not, and any P&O
Princess UK Report notified by P&O Princess to, or filed by P&O Princess with,
the UKLA subsequent to the date hereof will not, contain any untrue statement of
a material fact or omit to state a material fact required to be stated therein
or necessary to make the statements made therein, in the light of the
circumstances under which they were made, not misleading in any material
respect. Each of the consolidated balance sheets included in or incorporated by
reference into the P&O Princess Reports (including the related notes and
schedules) fairly presents, or will fairly present, in all material respects,
the consolidated financial position of P&O Princess and its Subsidiaries as of
its date, and each of the related consolidated statements of profit and loss
accounts, changes in shareholders' funds, total recognized gains and losses and
cash flows included in or incorporated by reference into the P&O Princess
Reports (including any related notes and schedules) fairly presents, or, in the
case of those filed with or furnished to, the SEC after the date hereof, will
fairly present, in all material respects, the consolidated results of
operations, retained earnings and cash flows of P&O Princess and its
consolidated
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Subsidiaries for the periods set forth therein (subject, in the case of
unaudited statements, to notes and normal year-end audit adjustments that are
not expected to be material in amount or effect), in each case in accordance
with UK GAAP consistently applied during the periods involved except as may be
noted therein. The related notes to the P&O Princess US Reports filed with the
SEC reconciling such consolidated balance sheet, consolidated statement of
income, statement of changes in shareholders' interest, and statement of cash
flows comply in all material respects with the requirements of the SEC
applicable to such reconciliation to US GAAP. Except as disclosed in the P&O
Princess Reports filed prior to the date hereof, P&O Princess and its
consolidated Subsidiaries have not incurred any liabilities that are of a nature
that would be required to be disclosed on a balance sheet of P&O Princess and
its consolidated Subsidiaries or the footnotes thereto prepared in conformity
with UK GAAP, other than (A) liabilities incurred in the ordinary course of
business consistent with past practice, (B) liabilities incurred in accordance
with Section 4.1, (C) liabilities for Taxes in respect of income, profits or
gains earned in the ordinary course of business or (D) liabilities that,
individually or in the aggregate, have not had and are not reasonably likely to
have a Material Adverse Effect with respect to P&O Princess.
3.1.6 Absence of Certain Changes. Except as disclosed in its
Reports filed or furnished prior to the date hereof, or as expressly
contemplated by this Agreement, since its Audit Date it and its Significant
Subsidiaries have conducted their respective businesses only in, and have not
engaged in any material transaction ("material" being construed in the context
of the Party and its Subsidiaries taken as a whole) other than according to, the
ordinary and usual course of such businesses, and there has not been (i) any
Material Adverse Change with respect to it; (ii) declaration, setting aside or
payment of any dividend or other distribution in cash, stock or property in
respect of its capital stock, except for dividends or other distributions on its
capital stock publicly announced prior to the date hereof and except as
expressly permitted hereby; (iii) any split in its capital stock, combination,
subdivision or reclassification of any of its capital stock or issuance or
authorization of any issuance of any other securities in respect of, in lieu of
or in substitution for shares of its capital stock, except as expressly
contemplated hereby or (iv) any change by it in accounting principles, practices
or methods except as required by changes in US GAAP or UK GAAP, as the case may
be. Since its Audit Date, except as provided for herein or as disclosed in its
Reports filed or furnished prior to the date hereof, there has not been any
increase in the compensation payable or that could become payable by it or any
of its Subsidiaries to officers or key employees, or any amendment of, or
acceleration of the time of payment or vesting under, any of its Compensation
and Benefit Plans or agreements, other than increases or amendments in the
ordinary course of business consistent with past practice that are not,
individually or aggregate, material ("material" being construed in the context
of the Party and its Subsidiaries taken as a whole) or that are contemplated by
this Agreement.
3.1.7 Litigation and Liabilities.
3.1.7.1 Except as disclosed in its Reports filed or
furnished prior to the date hereof, there are no (i) civil, criminal or
administrative actions, suits, claims, hearings, investigations or proceedings
existing, pending or, to the knowledge of,
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in the case of Carnival, its Chief Executive Officer, Chief Financial Officer or
General Counsel (the "Carnival Officers") and, in the case of P&O Princess, its
Chief Executive Officer, Chief Financial Officer or General Counsel (the "P&O
Princess Officers") threatened, against it or any of its Subsidiaries or (ii)
obligations or liabilities, whether or not accrued, contingent or otherwise and
whether or not required to be disclosed, or any other facts or circumstances of
which, in the case of Carnival, the Carnival Officers, and, in the case of P&O
Princess, the P&O Princess Officers, have knowledge that would reasonably be
expected to result in any claims against, or obligations or liabilities of, it
or any of its Subsidiaries, except, in each case, for those that, individually
or in the aggregate, have not had and are not reasonably likely to have a
Material Adverse Effect with respect to it.
3.1.7.2 Except as disclosed in its Reports filed or
furnished prior to the date hereof it and its Subsidiaries hold all permits,
licenses, franchises, variances, exemptions, orders and approvals of
Governmental Entities which are necessary for the operation of the businesses as
now being conducted by it and its Subsidiaries, taken as a whole (as to each
Party, its "Permits"), no suspension or cancellation of any of its Permits is
pending or, to the knowledge of the Carnival Officers in the case of Carnival or
the P&O Princess Officers in the case of P&O Princess, threatened and it and its
Subsidiaries are in compliance with the terms of its Permits, except for any
such failures to hold, suspensions or cancellations of, or failures to comply
with, such Permits that, individually or in the aggregate, have not had and are
not reasonably likely to have a Material Adverse Effect with respect to it.
Neither it nor its Subsidiaries is in violation with respect to any Laws of any
Governmental Entity, except for any such violations which, individually or in
the aggregate, have not had and are not reasonably likely to have a Material
Adverse Effect with respect to it.
3.1.8 Brokers and Finders. Neither it nor any of its
Subsidiaries, officers, directors or employees has employed any broker or finder
or incurred any liability for any brokerage fees, commissions or finders' fees
in connection with the execution and delivery of this Agreement or the
Transactions, except that (i) Carnival has retained Xxxxxxx Xxxxx International
and UBS Warburg Ltd. as its financial advisors and disclosed its arrangements
with such financial advisors to P&O Princess prior to the date hereof and (ii)
P&O Princess has retained Xxxxxxxx Xxxxxxx Xxxxx Xxxxxx as its financial
advisors and disclosed its arrangements with such financial advisor to Carnival
prior to the date hereof.
3.1.9 Ownership of Other Party's Common Stock.
3.1.9.1 Carnival and its Subsidiaries do not
"beneficially own" (as such term is defined in Rule 13d-3 under the Exchange
Act) any P&O Princess Ordinary Shares or P&O Princess American Depositary
Shares.
3.1.9.2 P&O Princess and its Subsidiaries do not
"beneficially own" (as such term is defined in Rule 13d-3 under the Exchange
Act) any shares of Carnival Common Stock or any debt of Carnival that is
convertible into such shares.
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3.1.10 Taxes. Except for any such matters that, individually
or in the aggregate, have not had and are not reasonably likely to have a
Material Adverse Effect with respect to it, it and each of its Subsidiaries (i)
have prepared in good faith and duly and timely filed (taking into account any
extension of time within which to file) all Tax Returns required to be filed by
any of them and all such filed Tax Returns are complete and accurate in all
material respects; (ii) have paid all Taxes that are required to have been paid
including any Taxes which it or any of its Subsidiaries are obligated to
withhold from amounts owing to any employee, creditor or third party, except
with respect to matters contested in good faith; (iii) have not waived any
statute of limitations with respect to Taxes or agreed to any extension of time
with respect to a Tax assessment or deficiency and (iv) have no liability with
respect to Taxes that accrued on or before November 30, 2001 (in the case of
Carnival) or December 31, 2001 (in the case of P&O Princess) in excess of the
amounts accrued with respect thereto that are reflected in the financial
statements included in the Reports filed or furnished on or prior to the date
hereof. Except for any such matters that, individually or in the aggregate, have
not had and are not reasonably likely to have a Material Adverse Effect with
respect to it, there are no pending or, to the knowledge of the P&O Princess
Officers or the Carnival Officers (as appropriate) threatened in writing, any
audits, examinations, investigations or other proceedings in respect of Taxes
and Tax matters or any unresolved questions or claims concerning its or any of
its Subsidiaries' Tax liability.
As used in this Agreement, (i) the term "Tax" (including, with correlative
meaning, the terms "Taxes", and "Taxable") includes all national, federal,
state, local and foreign income, profits, franchise, gross receipts,
environmental, customs duty, capital stock, capital gains, severance, stamp,
payroll, sales, employment, unemployment, disability, use, property,
withholding, excise, production, value added, occupancy and other taxes, duties
or assessments of any nature whatsoever whether levied in the United Kingdom,
Panama, the United States or any other country, together with all interest,
penalties and additions imposed with respect to such amounts and any interest in
respect of such penalties and additions, and (ii) the term "Tax Return" includes
all returns and reports (including elections, declarations, disclosures,
schedules, estimates and information returns) required to be supplied to a Tax
authority relating to Taxes.
3.1.11 Carnival Common Stock to be Issued in the Offer. All
of the shares of Carnival Common Stock to be issued in the Offer in accordance
with this Agreement will be, when so issued, duly authorized, validly issued,
fully paid and non-assessable and free of preemptive rights.
ARTICLE IV
Covenants
4.1 Interim Operations. Each of Carnival and P&O Princess
covenants and agrees as to itself and its Subsidiaries that, after the date
hereof and until the Effective Time, except (i) as the other Party shall
otherwise approve in writing, (ii) as set forth in the corresponding section of
the applicable Disclosure Letter, (iii) as otherwise
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expressly contemplated by or provided in this Agreement, or (iv) as required by
applicable Law:
4.1.1 Ordinary Course. The businesses of it and its Subsidiaries
(taken as a whole) shall be conducted in the usual, regular and ordinary course
consistent with past practice and, to the extent consistent therewith, it and
each of its Significant Subsidiaries shall use its reasonable best efforts to
preserve its business organization and present lines of business materially
intact and maintain its commercially reasonable insurance (taking into account
industry practice and market conditions) and material rights and franchises and
preserve its existing material relations with third parties. Notwithstanding
anything in this Agreement to the contrary, none of the following actions by any
Party and/or its Subsidiaries after the date of this Agreement shall be
prohibited by this Agreement: (i) any internal reorganizations and related
actions pursuant thereto involving such Party and/or its Subsidiaries that do
not have and are not reasonably likely to have a Material Adverse Effect on such
Party, (ii) any purchase, sale or charters of any vessels or any amendment to,
or termination of, new-building contracts, (iii) any other acquisitions or
investments for consideration not exceeding in the aggregate $500 million plus
the net proceeds of any divestments referred to in the next clause, and (iv) any
divestments the net proceeds of which do not exceed $500 million in the
aggregate;
4.1.2 Governing Documents; Share Capital; Dividends. It shall not
(i) amend its articles of incorporation or by-laws, in the case of Carnival, or
its memorandum and articles of association, in the case of P&O Princess (except
for any amendments made solely to preserve its tax position to the extent
necessary or desirable); (ii) split, combine, subdivide or reclassify its
outstanding shares of capital stock or issue or authorize or propose the
issuance of any other securities in respect of, in lieu of or in substitution
for, shares of its capital stock; (iii) declare, set aside or pay any dividend
or distribution payable in cash, stock or property in respect of any capital
stock other than (A) in the case of Carnival, regular quarterly cash dividends
consistent with past practice and (B) in the case of P&O Princess, regular
quarterly cash dividends consistent with past practice (it being understood that
P&O Princess may accelerate payment of its dividend for the fourth quarter of
the 2002 financial year to March 2003); or (iv) reduce, cancel, repurchase,
redeem or otherwise acquire or permit any of its Subsidiaries to reduce, cancel,
purchase or otherwise acquire (except for repurchases, redemptions or
acquisitions required by (A) the terms of its capital stock or securities
outstanding on the date hereof or (B) the respective terms as of the date hereof
of, or in connection with, any Carnival Stock Plans, in the case of Carnival, or
P&O Princess Option Plans, in the case of P&O Princess, or any dividend
reinvestment plans as in effect on the date hereof in the ordinary course of the
operation of such plans), any shares of the capital stock of P&O Princess or
Carnival, as the case may be, or any securities convertible into or exchangeable
or exercisable for any shares of its capital stock;
4.1.3 Issuance of Securities; Indebtedness; Acquisitions and
Dispositions. Neither it nor any of its Subsidiaries shall (i) issue, sell,
pledge, dispose of or encumber any shares of, or securities convertible into or
exchangeable or exercisable
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for, or rights, options, warrants, conversion rights, stock appreciation rights,
redemption rights, repurchase rights, agreements, arrangements, calls,
commitments or rights of any kind to acquire, the capital stock of P&O Princess
or Carnival, as the case may be, of any class other than (x) in the case of
Carnival, shares of Carnival Common Stock issuable pursuant to options
outstanding on the date hereof under the Carnival Stock Plans, additional
options or rights to acquire shares of Carnival Common Stock granted under the
terms of any Carnival Stock Plan as in effect on the date hereof in the ordinary
course of the operation of such Carnival Stock Plan or pursuant to Carnival's
convertible debt securities outstanding as of the date hereof, (y) in the case
of P&O Princess, P&O Princess Ordinary Shares issuable or transferable pursuant
to options outstanding on the date hereof under the P&O Princess Option Plans
and additional options or rights to acquire P&O Princess Ordinary Shares granted
under the terms of any P&O Princess Option Plans as in effect on the date hereof
in the ordinary course of the operation of such P&O Princess Option Plan and (z)
issuances of securities in connection with grants or awards of stock-based
compensation made in accordance with paragraph 4.1.4 hereof), or (ii) incur or
modify any significant indebtedness or other liability except in the ordinary
and usual course of business consistent with past practice or pursuant to the
financial plans communicated to the other Party in writing prior to the date
hereof. Neither it nor any of its Significant Subsidiaries will merge or
consolidate with any Person;
4.1.4 Employee Benefits. Neither it nor any of its Subsidiaries
shall terminate, establish, adopt, enter into, make any new grants or awards of
stock-based compensation or other benefits under, accelerate the time of payment
or vesting under, amend or otherwise modify any Compensation and Benefit Plan or
agreement or increase the salary, wage, bonus or other compensation of any
directors, officers or employees except for grants or awards to directors,
officers and employees of it or its Subsidiaries under existing Compensation and
Benefit Plans, agreements or otherwise in each case in the normal and usual
course of business consistent with past practice (which shall include normal
periodic performance reviews and related compensation and benefit increases);
4.1.5 Representations and Warranties. Neither it nor any of its
Subsidiaries shall take any action or omit to take any action that would cause
any of its representations and warranties not to satisfy the condition set forth
in Section 5.2.1 or 5.3.1, as applicable, as of the Closing Date;
4.1.6 Non-Competition Agreements. Neither Party shall enter into
or renew any non-compete, exclusivity or similar agreement that would restrict
or limit, in any material respect as of the Effective Time (material being
construed in the context of the Party and its Subsidiaries taken as a whole),
its operations;
4.1.7 Satisfaction of Closing Conditions. Neither Party shall
take any action or omit to take any action for the purpose of preventing,
delaying or impeding the consummation of the Transactions; and
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4.1.8 No Related Actions. Neither it nor any of its Subsidiaries
shall authorize or enter into an agreement to do any of the foregoing.
4.2 Acquisition Proposals.
4.2.1 No Shop. Each of Carnival and P&O Princess agrees that,
subject to Section 4.2.3 and except as expressly contemplated by this Agreement,
neither it nor any of its Subsidiaries nor any of the officers or directors of
it or its Subsidiaries shall, and that it shall direct and use its reasonable
best efforts to cause its and its Subsidiaries' officers, directors, employees,
investment bankers, attorneys, accountants, financial advisors, agents or other
representatives (collectively, with respect to each of Carnival and P&O
Princess, such Person's "Representatives") not to, directly or indirectly,
initiate, solicit, encourage or otherwise facilitate any inquiries or the making
of any proposal or offer by a third party with respect to a merger, takeover,
reorganization, share exchange, scheme of arrangement, dual-holding company
transaction, consolidation or similar transaction involving Carnival or P&O
Princess, or any purchase of or joint venture (or similar arrangement)
involving, or offer to purchase or enter into a joint venture (or similar
arrangement) involving, all or 15% or more of the equity securities of Carnival
or P&O Princess, as the case may be, or of its and its Subsidiaries' assets
taken as a whole (any such proposal or offer being hereinafter referred to as an
"Acquisition Proposal"). Each of Carnival and P&O Princess further agrees that
neither it nor any of its Subsidiaries nor any of its or its Subsidiaries'
officers or directors shall, and that it shall direct and use its reasonable
best efforts to cause its Representatives not to, directly or indirectly, have
any discussions with or provide any confidential information or data to any
Person relating to an Acquisition Proposal or engage in any negotiations
concerning an Acquisition Proposal, or otherwise facilitate any effort or
attempt to make or implement an Acquisition Proposal; provided, however, that
nothing contained in this Agreement shall prevent either Carnival or P&O
Princess or its board of directors from (i) negotiating with or furnishing
information to any Person who has made a bona fide unsolicited written
Acquisition Proposal which did not result from a breach of this Section 4.2.1
(or any action that would have constituted such a breach if the Representatives
of such Party were bound by this Section to the same extent as such Party) or
Section 6 of, or any comparable no-shop provision in, the Stockholders Deed
Polls (or any action that would have constituted a breach if the Representatives
(as defined in the Stockholders Deed Polls) were bound by such Section to the
same extent as the Carnival Major Stockholders) (each, a "Qualifying Acquisition
Proposal") or (ii) recommending a Qualifying Acquisition Proposal to its
shareholders, if and only to the extent that, in each case, the board of
directors of such Party determines in good faith after consultation with outside
legal counsel that the failure to take such action would result in a breach of
the fiduciary duties of the Board of Directors and such Qualifying Acquisition
Proposal is a Superior Proposal. For purposes of this Agreement, a "Superior
Proposal" means in respect of Carnival or P&O Princess, as applicable, any
Qualifying Acquisition Proposal by a third party (x) on terms which the board of
directors of such Party determines in its good faith judgment to be more
favorable from a financial point of view to its shareholders than the
Transactions after consultation with its financial advisors (which advice shall
be communicated to the other Party) and after giving the
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other Party at least ten Business Days to respond to such third party Qualifying
Acquisition Proposal, (y) which the board of directors of such Party determines
in its good faith judgment to constitute a transaction that is reasonably likely
to be consummated on the terms set forth, taking into account all legal,
financial, regulatory and other aspects of such proposal and (z) which relates
to at least a majority of the consolidated assets by value or the securities by
voting power of such Party. Each of Carnival and P&O Princess agrees that it
will immediately cease and cause to be terminated any existing activities,
discussions or negotiations with any Person conducted heretofore with respect to
any Acquisition Proposal. Each of Carnival and P&O Princess also agrees that if
it has not already done so, it will promptly request each Person, if any, that
has heretofore executed a confidentiality agreement within the 12 months prior
to the date hereof in connection with its consideration of any Acquisition
Proposal to return or destroy all confidential information heretofore furnished
to such Person by or on behalf of it or any of its Subsidiaries.
4.2.2 Notifications. Each of Carnival and P&O Princess agrees
that it will take the necessary steps promptly to inform its Subsidiaries and
its and its Subsidiaries' Representatives of the obligations undertaken in this
Section 4.2. Each of Carnival and P&O Princess agrees that it will notify the
other promptly if any inquiries, proposals or offers relating to or constituting
an Acquisition Proposal are received by, any information is requested from, or
any such discussions or negotiations are sought to be initiated or continued
with, it, any of its Subsidiaries or any of its or its Subsidiaries'
Representatives indicating, in connection with such notice, the name of such
Person and the material terms and conditions of any proposals or offers and
thereafter shall keep the other informed, on a current basis, of the status and
material terms of any such proposals or offers, including providing the other
Party with copies of any information provided to such other Person.
4.2.3 Compliance with Exchange Act, Exchange Regulations and City
Code. Nothing contained in this Agreement shall prohibit a Party from taking and
disclosing to its shareholders a position contemplated by Rule 14e-2(a) under
the Exchange Act with respect to an Acquisition Proposal by means of a tender or
exchange offer or taking such action and making such recommendations as its
board of directors shall determine, in good faith after consultation with
outside legal counsel, is required in order to comply with any obligations
imposed on it by the SEC, the NYSE, the City Code, the Takeover Panel, the
London Stock Exchange or the UKLA in relation to any Acquisition Proposal
(provided that it is hereby acknowledged, for the avoidance of doubt, that no
provision of the City Code requires P&O Princess or its directors to solicit or
initiate any Acquisition Proposal). If the SEC, the NYSE, the Takeover Panel,
UKLA or London Stock Exchange, as applicable, requests or directs a Party to
take any course of action in connection with, or which would have any effect on,
the Transactions, then such Party agrees, solely to the extent practicable
(having regard to the time available and the nature and urgency of such request
or direction), to (i) notify the other Party of this fact and (ii) consult with
the other Party prior to taking any action with respect to such request or
direction.
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4.3 Information Supplied.
4.3.1 Shareholder Documents. Each of Carnival and P&O Princess
each agrees, as to itself and its Subsidiaries that:
4.3.1.1 It shall provide such information for inclusion in
each of the Shareholder Documents, such that each Shareholder Document shall
contain all particulars relating to Carnival and P&O Princess required to comply
in all material respects with all applicable Laws, including the PGCL, the
Companies Act, the City Code and the Financial Services and Markets Act 2000
(and the rules and regulations thereunder), the requirements of the London Stock
Exchange, the listing rules of the UKLA, the Securities Act, the Exchange Act
and the rules and regulations of the SEC and the NYSE;
4.3.1.2 The information provided by such Party for
inclusion or incorporation by reference in any of the Shareholder Documents
shall not, at the date of mailing to shareholders and at the time or times of
the Carnival Shareholders Meeting or the P&O Princess Shareholders Meeting, as
applicable, contain any untrue statement of a material fact or omit to state any
material fact required to be stated therein or necessary in order to make the
statements therein, in the light of the circumstances under which they were
made, not misleading in any material respect; and
4.3.1.3 If at any time prior to the Carnival Shareholders
Meeting or the P&O Princess Shareholders Meeting, as applicable, any information
relating to Carnival or P&O Princess, or any of their respective Affiliates,
officers or directors, should be discovered by Carnival or P&O Princess which
should be set forth in a supplement to any of the Shareholder Documents, so that
such document would not include any misstatement of a material fact or omit to
state any material fact required to be stated therein or necessary to make the
statements therein, in the light of the circumstances under which they were
made, not misleading in any material respect, the Party which discovers such
information shall promptly notify the other Party and, to the extent required by
Law, an appropriate amendment or supplement describing such information shall be
promptly disseminated to the Carnival shareholders or the P&O Princess
shareholders, as applicable.
4.4 Shareholders Meetings. Carnival and P&O Princess will each
respectively take all action necessary to convene a meeting of the holders of
Carnival Common Stock to obtain the Carnival Requisite Vote (the "Carnival
Shareholders Meeting") and the holders of P&O Princess Ordinary Shares to obtain
the P&O Princess Requisite Vote (the "P&O Princess Shareholders Meeting") to
approve the Transactions, as soon as possible after the date hereof, and the
Parties shall liaise to ensure that the Carnival Shareholders Meeting will be
held two days prior to the P&O Princess Shareholders Meeting; provided that if
either Party elects to hold its meeting on an earlier date, it may do so;
provided, however, the P&O Princess Shareholders Meeting may not be convened
prior to the 20th Business Day after commencement of the Offer. Subject to
fiduciary obligations and the requirements of applicable Law, the board of
directors of each of Carnival and P&O Princess shall recommend to its respective
shareholders the
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approval of, in the case of Carnival, the Carnival Amendments and, in the case
of P&O Princess, the P&O Princess Amendments, and in each case, this Agreement
and the DLC Transactions, which recommendation shall be set forth in the
Carnival Circular and the P&O Princess EGM Circular, respectively, and shall
take all lawful action to solicit such approval. The Carnival Shareholders
Meeting and the P&O Princess Shareholders Meeting will be held regardless of any
failure to make such recommendation or any change in such recommendation.
4.5 Filings; Other Actions; Notification.
4.5.1 Filings. As promptly as practicable after the execution of
this Agreement, Carnival and P&O Princess shall prepare and make all necessary
filings and notifications to any Governmental Entity required to implement the
DLC Transactions, including the filing of the Shareholder Documents with the SEC
and UKLA, as appropriate. Carnival and P&O Princess shall cooperate to conform
the content of the Shareholder Documents, to the extent reasonably practicable
and appropriate. Carnival and P&O Princess each shall use its reasonable best
efforts to have the Registration Statements declared effective by the SEC as
promptly as practicable after filing. P&O Princess and Carnival each shall use
its reasonable best efforts to have the P&O Princess EGM Circular approved by
the UKLA as promptly as practicable after filing. Carnival and P&O Princess
shall each provide the other and its counsel with copies of any comments
Carnival or P&O Princess or its counsel may receive from the SEC or its Staff or
the UKLA, as applicable, with respect to the Shareholders Documents promptly
after the receipt of such comments, and Carnival and P&O Princess shall
cooperate (and shall cause their respective counsel to cooperate) reasonably in
responding promptly and appropriately to such comments. Carnival shall promptly
prepare and file a supplemental listing application with the NYSE with respect
to the shares of Carnival Common Stock to be issued in the Offer and shall use
its reasonable best efforts to have such shares of Carnival Common Stock
approved for listing by the NYSE, subject only to official notice of issuance,
and shall promptly prepare and file a listing application with the NYSE with
respect to the SVT Shares and shall use its reasonable best efforts to have such
SVT Shares approved for listing by the NYSE, subject only to official notice of
issuance.
4.5.2 Mailing of Documents. Carnival shall use its reasonable best
efforts to cause the Carnival Circular to be mailed to its shareholders as
promptly as practicable after the SEC has declared the Second Joint Registration
Statement effective. P&O Princess shall use its reasonable best efforts to cause
the P&O Princess EGM Circular to its shareholders, and Carnival shall use its
reasonable best efforts to cause the Offer Documents to be mailed to the P&O
Princess shareholders as promptly as practicable after the SEC has declared the
Joint Registration Statement effective and UKLA has approved the P&O Princess
EGM Circular.
4.5.3 Cooperation. Carnival and P&O Princess shall each cooperate
with the other and (i) use (and shall cause their respective Subsidiaries to
use) all their respective reasonable best efforts promptly to take or cause to
be taken all
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actions, and do or cause to be done all things, necessary, proper or advisable
under this Agreement and applicable Laws to consummate and make effective the
Transactions as soon as practicable, including preparing and filing as promptly
as practicable all documentation to effect all necessary filings, notices,
petitions, statements, registrations, submissions of information, applications
and other documents, (ii) use (and shall cause their respective Subsidiaries to
use) all their respective reasonable best efforts to obtain as promptly as
practicable all approvals, consents, registrations, permits, authorizations and
other confirmations required to be obtained from any third party (other than
Carnival Required Consents and P&O Princess Required Consents) necessary, proper
or advisable to consummate the Transactions, and (iii) use (and shall cause
their respective Subsidiaries to use) their respective reasonable best efforts
to take or cause to be taken all actions, and do or cause to be done all things,
necessary, proper or advisable to obtain the Carnival Required Consents or P&O
Princess Required Consents, as the case may be; provided that neither Party
shall be required by this Section 4.5.3(ii) or (iii) to accept or agree to any
conditions, terms or restrictions in connection with any such Carnival Required
Consent or P&O Princess Required Consent, as the case may be, which,
individually or in the aggregate, would be reasonably likely to have a Material
Adverse Effect on P&O Princess and/or Carnival after the Effective Time (it
being understood that, for this purpose, materiality shall be considered with
reference to the total equity market value of P&O Princess and Carnival as a
unified commercial enterprise). Subject to applicable Laws relating to the
exchange of information, Carnival and P&O Princess shall have the right to
review in advance, and to the extent practicable each will consult the other on,
all the information relating to Carnival and its Subsidiaries or P&O Princess
and its Subsidiaries, as the case may be, that appears in any filing made with,
or written materials submitted to, any third party and/or any Governmental
Entity in connection with the Transactions. In exercising the foregoing right,
each of Carnival and P&O Princess shall act reasonably and as promptly as
practicable.
4.5.4 Furnishing Information. Carnival and P&O Princess each shall,
upon request by the other, furnish the other with all information concerning
itself, its Subsidiaries, directors, officers and shareholders and such other
matters as may be reasonably necessary or advisable in connection with the
Shareholder Documents or any other necessary or appropriate filing, notice,
statement, registration, submission of information or application made by or on
behalf of Carnival or P&O Princess or any of their respective Subsidiaries to
any third party and/or any Governmental Entity in connection with the
Transactions.
4.5.5 Status. Carnival and P&O Princess each shall keep the other
apprised of the status of matters relating to completion of the Transactions,
including promptly furnishing the other with copies of notices or other
communications received by Carnival or P&O Princess, as the case may be, or any
of its Subsidiaries, from any third party and/or any Governmental Entity with
respect to the Transactions. Carnival and P&O Princess each shall give prompt
notice to the other of any change that is reasonably likely to result in a
Material Adverse Effect on it or of any failure of any condition set forth in
Article V to the other Party's obligations to effect the Transactions.
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4.5.6 Consultation; Participation. Prior to making any filing,
notice, petition, statement, registration, submission of information or
application to or with any third party and/or Governmental Entity (including any
securities exchange) in connection with the consummation of the Transactions and
except as may be required by Law or by obligations pursuant to any listing
agreement with or rules of any securities exchange, each Party shall make all
reasonable efforts to consult with the other Party with respect to the content
of such filing, notice, petition, statement, registration, submission of
information or application and to provide the other Party with copies of the
proposed filing, notice, petition, statement, registration, statement of
information or application. Carnival and P&O Princess each shall not agree to
participate in any meeting with any Governmental Entity in respect of any
filings, investigation or other inquiry relating to the Transactions unless it
consults with the other Party in advance and, to the extent practicable and
permitted by such Governmental Entity, gives the other Party the opportunity to
attend and participate thereat. The foregoing requirements of Section 4.5.6
shall not apply to P&O Princess' discussions and meetings with the UK Inland
Revenue with respect to tonnage taxes and amendments to existing tonnage tax
elections; provided that P&O Princess shall notify Carnival of any such
discussions and meetings, and to the extent practicable, consult with Carnival
with respect thereto.
4.5.7 Cooperation in Defense of Claim. In the event any claim,
action, suit investigation or other proceeding by any Governmental Entity or
other Person or other legal or administrative proceeding is commenced that
questions the validity or legality of this Agreement or any of the Transactions
or claims damages in connection therewith, the Parties agree to cooperate and
use their reasonable best efforts, subject to the limitations set forth in
Section 4.5.3, to defend against and respond thereto.
4.6 Access. In order to facilitate consummation of the Transactions,
the Parties hereby agree that upon reasonable request to an executive officer of
P&O Princess or Carnival, as the case may be, designated for the purpose, and
except as may otherwise be required by applicable Law, each Party shall (and
shall cause its Subsidiaries to) afford the other Party's Representatives
access, during normal business hours throughout the period prior to the
Effective Time, to its properties, books, contracts and records and, during such
period, each shall (and shall cause its Subsidiaries to) furnish promptly to the
other all information concerning its business, properties and personnel as may
be requested by the other Party which it reasonably requires in order to
investigate and confirm the accuracy of such Party's representations and
warranties and the satisfaction of the conditions to Closing relating thereto;
provided that no receipt of information pursuant to this Section shall affect or
be deemed to modify any representation or warranty made by Carnival or P&O
Princess hereunder; and provided, further that the foregoing shall not require
Carnival or P&O Princess to permit any inquiry, or to disclose any information,
that in the reasonable judgment of Carnival or P&O Princess, as the case may be,
would (i) violate any antitrust or competition Law or (ii) result in the
disclosure of any trade secrets of third parties or violate any of its
obligations with respect to confidentiality to third parties if Carnival or P&O
Princess, as the case may be, shall have used reasonable efforts to obtain the
consent of such third party to such inspection or disclosure. All such
information shall be governed by the
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terms of the Confidentiality Agreement, dated October 11, 2002, between the
Parties (the "Confidentiality Agreement"), including without limitation all such
information disclosed in the Disclosure Letters.
4.7 Publicity. Carnival and P&O Princess shall to the extent practicable
(i) consult with each other and, except as may be required by Law or by
obligations pursuant to any listing agreement with or rules of any national
securities exchange or as required by the Takeover Panel, mutually agree on the
content prior to issuing any press releases or otherwise making public
announcements with respect to the Transactions and (ii) consult with each other
prior to issuing any press releases or otherwise making public announcements
which could materially affect the Transactions.
4.8 Benefits and Other Matters.
4.8.1 Director and Officer Liability.
4.8.1.1 P&O Princess and Carnival each agree that all
rights to indemnification and all limitations on liability existing in favor of
any Indemnitee (as defined below) in respect of acts or omissions of such
Indemnitee on or prior to the Effective Time as provided in the articles of
incorporation and by-laws, in the case of Carnival, or memorandum and articles
of association, in the case of P&O Princess, or an agreement between an
Indemnitee and it or its Subsidiaries in effect as of the date hereof shall
continue in full force and effect in accordance with the terms thereof.
4.8.1.2 For six years after the Effective Time, P&O
Princess or Carnival, as the case may be, shall indemnify and hold harmless the
individuals who on or prior to the Effective Time were officers or directors of
either Party or either Party's Subsidiaries (the "Indemnitees") to the same
extent as set forth in Section 4.8.1.1 above. In the event any claim in respect
of which indemnification is available pursuant to the foregoing provisions is
asserted or made within such six-year period, all rights to indemnification
shall continue until such claim is disposed of or all judgments, orders, decrees
or other rulings in connection with such claim are duly satisfied.
4.8.1.3 For six years after the Effective Time, P&O
Princess and Carnival shall provide officers' and directors' liability insurance
in respect of acts or omissions occurring prior to the Effective Time covering
each such Person currently covered by its officers' and directors' liability
insurance policy on terms with respect to coverage and in amounts no less
favorable than those of such policy in effect on the date hereof; provided,
however, that during such period, Carnival and P&O Princess shall be required to
maintain or procure as much coverage as can be obtained for the remainder of
such period for an annual premium not in excess of 200% of the current annual
premium paid by P&O Princess or Carnival, as the case may be, for its existing
coverage.
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4.8.1.4 The obligations of P&O Princess and Carnival under
this Section 4.8.1 shall not be terminated or modified in such a manner as to
adversely affect any Indemnitee to whom this Section 4.8.1 applies without the
consent of such affected Indemnitee (it being expressly agreed that the
Indemnitees to whom this Section 4.8.1 applies shall be third party
beneficiaries of this Section 4.8.1).
4.8.1.5 Each Party (the "Providing Party") shall indemnify
and hold harmless, to the fullest extent permissible under applicable Law, the
officers and directors of the other party in respect of all losses, claims,
damages, costs, expenses and liabilities arising from or in connection with the
information provided by such Providing Party for use in the Shareholder
Documents pursuant to Section 4.3 which contains any untrue statement of a
material fact or an omission to state any material fact required to be stated
therein or necessary to make the statements therein not misleading.
4.8.2 Directors of Carnival and P&O Princess. At the Effective
Time, the board of directors of each of Carnival and P&O Princess shall consist
of the individuals listed on Exhibit J (the "Mutual Directors"). Such Mutual
Directors shall be the directors of each of Carnival and P&O Princess from and
after the Effective Time until their successors have been duly elected or
appointed and qualified or until their earlier death, resignation or removal in
accordance with P&O Princess' memorandum and articles and Carnival's restated
articles of incorporation and by-laws, in each case as then in effect. Carnival
and P&O Princess agree to procure such resignations of their respective
directors as may be necessary so that at the Effective Time the Mutual Directors
are the only directors of Carnival and P&O Princess.
4.8.3 Executive Officers. At the Effective Time, Xxxxx Xxxxxx
shall be elected or appointed as Chairman and Chief Executive Officer of
Carnival and P&O Princess, and Xxxxxx X. Xxxxx shall be elected or appointed as
Chief Operating Officer of Carnival and P&O Princess, to serve in such
capacities until their respective successors are elected or appointed and shall
have qualified in accordance with the P&O Princess' memorandum and articles and
Carnival's restated articles of incorporation and by-laws, in each case as then
in effect. If at or immediately prior to the Effective Time, either of such
individuals shall be unwilling or unable to serve, a person to fill such
position shall be designated by the chief executive officer of Carnival at such
time.
4.9 Expenses. Except as otherwise provided in Section 6.5, whether or
not the Transactions are consummated, all costs and expenses incurred in
connection with this Agreement and the Transactions shall be paid by the Party
incurring such expense, except that the Parties each shall pay one-half of
filing fees and printer costs and expenses in connection with the preparation
and filing of the Shareholder Documents.
4.10 Other Actions by Carnival and P&O Princess.
4.10.1 Dividends. Except with respect to the distribution of the 0
SVT Shares by Carnival contemplated by this Agreement, Carnival and P&O Princess
shall coordinate the declaration, setting of record dates and payment dates of
dividends on Carnival Common Stock and P&O Princess Ordinary Shares so that the
respective
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holders of Carnival Common Stock and P&O Princess Ordinary Shares do not receive
two dividends in respect of the calendar quarter in which the Effective Time
occurs or fail to receive a dividend in respect of the calendar quarter in which
the Effective Time occurs.
4.10.2 Integration Planning. To the extent permitted by applicable
Law, promptly following the date of this Agreement, the Parties will establish
an integration planning committee (the "Integration Committee") to address and
agree upon integration issues. The Chief Executive Officer of each of Carnival
and P&O Princess shall determine which of their respective officers shall serve
on the Integration Committee and such Committee shall be comprised of an equal
number of persons from Carnival and P&O Princess.
4.11 Carnival Offer to Exchange. Section 4.11 is subject to applicable
Law.
4.11.1 Offer to Exchange. Provided that this Agreement shall not
have been terminated, and subject to the provisions of this Agreement, Carnival
shall commence, within the meaning of Rule 14d-2 under the Exchange Act, the
Offer, not later than ten business days after the effective date of the Joint
Registration Statement or earlier if required by the City Code. The Offer shall
be subject only to the conditions (the "Offer Conditions") set forth in Annex 1
hereto (including, without limitation, the occurrence of the Closing), of which
conditions 4 and 5 may be waived in whole or in part by Carnival in its sole
discretion. The P&O Princess EGM Circular shall state that P&O Princess
shareholders may (i) vote to approve the DLC Transactions; and/or (ii) accept
the Offer, subject to the terms and conditions set forth therein and in the
Offer Documents. Subject to the terms and conditions of the Offer and this
Agreement (including, without limitation, Section 4.11.4), Carnival shall
acquire all P&O Princess Ordinary Shares validly tendered and not withdrawn
pursuant to the Offer in compliance with the obligations respecting prompt
payment pursuant to Rule 14e-1(c) under the Exchange Act and Rule 31.8 of the
City Code.
4.11.2 Modification of the Offer, Fractional Shares. Subject to
the City Code, Carnival expressly reserves the right to modify the terms of the
Offer, except that, without the prior written consent of P&O Princess, Carnival
shall not (i) decrease the Offer Exchange Ratio, (ii) impose any conditions to
the Offer in addition to the Offer Conditions or modify the Offer Conditions
(other than to waive any Offer Conditions to the extent permitted by this
Agreement), (iii) except as provided in Section 4.11.3, extend the Offer, (iv)
change the form of consideration payable in the Offer or (v) make any other
change or modification in any of the terms of the Offer in any manner that is
adverse to the holders of P&O Princess Ordinary Shares. Notwithstanding anything
to the contrary set forth herein, no certificates representing fractional shares
of Carnival Common Stock shall be issued in connection with the exchange of
Carnival Common Stock for P&O Princess Ordinary Shares upon consummation of the
Offer, and in lieu thereof each tendering shareholder who would otherwise be
entitled to a fractional share of Carnival Common Stock in the Offer will be
paid an amount in cash equal to either: (i)
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the product obtained by multiplying (A) the fractional share interest to which
such holder would otherwise be entitled by (B) the closing price of the Carnival
Common Stock on the NYSE (as reported in The Wall Street Journal or, if not
reported therein, any other authoritative source) on the date the Offer becomes
unconditional; or (ii) the pro rata entitlement of such member to the net
proceeds of the sale of the aggregate fractional entitlements to Carnival Common
Stock which shall be sold in the market at the best price reasonably obtainable
by Carnival; provided always that Carnival shall be able to choose whether to
apply the procedure referred to in (i) or (ii) above, shall not be obliged to
give any reasons for such choice and such choice shall be conclusive and binding
on all persons concerned and shall not be open to challenge on any grounds
whatsoever.
4.11.3 Expiration and Extension of the Offer Acceptance Period.
The period for acceptance of the Offer shall initially expire at 5:00 p.m.,
London time, on the date of the P&O Princess Shareholders Meeting unless it is
extended by Carnival with the consent of the Takeover Panel.
4.11.4 Acceptances by Carnival. The terms of the Offer shall
provide that if the number of P&O Princess Ordinary Shares as to which the Offer
is accepted represents more than 20% of the outstanding P&O Princess Ordinary
Shares, only that number of P&O Princess Ordinary Shares representing 20% of the
outstanding P&O Princess Ordinary Shares shall be acquired by Carnival, and
acceptances shall be scaled back in the manner prescribed by Rule 36.7 of the
City Code.
4.11.5 Schedule TO. As promptly as practicable after the date
hereof, Carnival shall file with the SEC a Schedule TO.
4.11.6 P&O Princess Shareholder Information. In connection with
the Offer, P&O Princess shall cause its registrar to furnish Carnival promptly
with mailing labels containing the names and addresses of the record holders of
P&O Princess Ordinary Shares as of a recent date and of those persons becoming
record holders subsequent to such date, together with copies of all lists of
shareholders, security position listings and computer files and all other
information in P&O Princess's possession or control regarding the beneficial
owners of P&O Princess Ordinary Shares and any securities convertible into P&O
Princess Ordinary Shares, and shall furnish to Carnival such information and
assistance (including updated lists of shareholders, security position listings
and computer files) as Carnival may reasonably request in communicating the
Offer to P&O Princess's shareholders. P&O Princess shall cooperate with Carnival
to communicate the Offer to the holders of the P&O Princess ADSs. Subject to the
requirements of applicable Law, and except for such steps as are necessary to
disseminate the Offer Documents, Carnival and its affiliates, associates and
agents shall hold in confidence the information contained in any such labels,
listings and files, will use such information only in connection with the Offer
and, if this Agreement shall be terminated, will promptly, upon request,
deliver, and will use reasonable efforts to cause its affiliates, associates and
agents to deliver, to P&O Princess all copies of such information then in their
possession or control.
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4.11.7 Schedule 14D-9. In accordance with the Exchange Act, P&O
Princess shall file with the SEC a Statement on Schedule 14D-9 with respect to
the Offer (such document, as amended from time to time, the "Schedule 14D-9").
4.11.8 Termination of the Offer. The Offer may be terminated by
Carnival if, at the expiration date of the Offer, any of the Offer Conditions
has not been met.
4.11.9 Adjustment of the Offer Exchange Ratio. Subject to the
City Code, in the event that, other than pursuant to the Transactions, Carnival
changes or establishes a record date for changing the number of shares of
Carnival Common Stock issued and outstanding as a result of a stock split, stock
dividend, recapitalization, subdivision, reclassification, combination or
similar transaction with respect to the outstanding shares of Carnival Common
Stock and the record date therefor shall be prior to the Effective Time, the
Offer Exchange Ratio, and any other calculations based on or relating to the
shares of Carnival Common Stock shall be appropriately adjusted to reflect such
stock split, stock dividend, recapitalization, subdivision, reclassification,
combination or similar transaction. In the event that other than pursuant to the
Transactions, P&O Princess changes or establishes a record date for changing the
number of P&O Princess Ordinary Shares issued and outstanding as a result of a
stock split, stock dividend, recapitalization, subdivision, reclassification,
combination or similar transaction with respect to the outstanding P&O Princess
Ordinary Shares and the record date therefor shall be prior to the completion of
the Offer, the Offer Exchange Ratio, and any other calculations based on or
relating to the P&O Princess Ordinary Shares shall be appropriately adjusted to
reflect such stock split, stock dividend, recapitalization, subdivision,
reclassification, combination or similar transaction.
ARTICLE V
Conditions to the Closing
5.1 Conditions to Each Party's Obligation to Effect the Closing. The
respective obligations of P&O Princess and Carnival to effect the Closing and
the DLC Transactions are subject to the satisfaction or waiver of each of the
following conditions:
5.1.1 Shareholder Approvals. This Agreement and the DLC
Transactions (including the Carnival Amendments) shall have been duly approved
by holders of Carnival Common Stock constituting the Carnival Requisite Vote and
this Agreement, and the DLC Transactions (including the P&O Princess Amendments)
shall have been duly approved by the shareholders of P&O Princess constituting
the P&O Princess Requisite Vote.
5.1.2 Regulatory Consents. All Carnival Required Consents and
P&O Princess Required Consents from or with any Governmental Entity
(collectively, "Governmental Consents") in connection with the consummation of
the DLC Transactions, other than those Governmental Consents described in
Section 5.1.8 below,
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which are subject to satisfaction or waiver in accordance with such section,
shall have been made or obtained, and such Governmental Consents shall not
contain any terms or impose any condition or restriction relating or applying
to, or requiring changes in or limitations on, (i) the operation of any asset or
businesses of Carnival, P&O Princess or any of their respective Subsidiaries
which term, condition or restriction, individually or in the aggregate, would be
reasonably likely to have a Material Adverse Effect on P&O Princess or Carnival
after the Effective Time (it being understood that, for this purpose,
materiality shall be considered with reference to the total equity market value
of P&O Princess and Carnival as a unified commercial enterprise), or (ii) the
P&O Princess Amended Memorandum, the P&O Princess Amended Articles, the Carnival
Amended Articles, the Carnival Amended By-Laws, the Equalization and Governance
Agreement, the ability to vote the P&O Princess Special Share or P&O Princess
Ordinary Shares or the ability to vote the Carnival Special Share or Carnival
Common Stock (other than, in each case, terms, conditions or restrictions that
would not materially frustrate the express intent and purposes of this Agreement
or the Equalization and Governance Agreement).
5.1.3 Laws and Orders. No Governmental Entity of competent
jurisdiction shall have enacted, issued, promulgated, enforced or entered any
Law (whether temporary, preliminary or permanent) that is in effect and
restrains, enjoins or otherwise prohibits the consummation or performance of, or
materially adversely affects, the DLC Transactions (collectively, an "Order"),
and no Governmental Entity shall have instituted or threatened any proceeding
challenging the DLC Transactions or seeking any such Order or taken any action
or decision to revoke or materially amend any consent, clearance or approval of
the combination of P&O Princess and Carnival.
5.1.4 Carnival Amendments and P&O Princess Amendments. The
Carnival Amended Articles shall have been filed with the Companies Registry of
the Republic of Panama and the Carnival Amended Articles and Carnival Amended
By-laws shall have become effective and the P&O Princess Amended Memorandum and
the P&O Princess Amended Articles shall have become effective.
5.1.5 Approval of P&O Princess EGM Circular. The UKLA shall have
approved the P&O Princess EGM Circular.
5.1.6 Offer. The Offer shall have become unconditional (except
for the condition regarding the completion of the DLC Transactions).
5.1.7 Registration Statements. The Registration Statements shall
have been declared effective by the SEC and shall be effective and not the
subject of a stop order or other proceeding by the SEC to suspend their
effectiveness.
5.1.8 European Commission.
5.1.8.1 Insofar as the DLC Transactions constitute a
concentration which is required to be notified to the European Commission
pursuant to Article 4(1) of Council Regulation (EEC) No. 4064/89 (as amended)
(the "Merger Regulation"), and subject to Clause 5.1.8.2, either, (i) the
European Commission having
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adopted in relation to the DLC Transactions a decision under either Article
6(1)(a), Article 6(1)(b) or Article 8(2) of the Merger Regulation, or (ii) the
DLC Transactions shall have been deemed compatible with the common market in
accordance with Article 10(6) of the Merger Regulation.
5.1.8.2 In the event that a decision (or decisions) has
been taken under Article 9(3) of the Merger Regulation (or is deemed to have
been taken pursuant to Article 9(5) of the Merger Regulation) or Article 6(1) of
Protocol 24 to the Agreement to establish the European Economic Area (the "EEA
Agreement") to refer the whole or part of the DLC Transactions to the competent
authorities of one or more European Union or relevant EFTA state, decisions
having been taken by all such competent authorities to permit the DLC
Transactions; provided that if any such competent authority should have failed
to publish its report or the announcement of the findings of its examination, or
to complete its review, of the DLC Transactions within four months of the last
date on which the European Commission could have issued a decision in relation
to the DLC Transactions pursuant to Article 6 of the Merger Regulation, this
Condition to Closing shall be deemed to have been satisfied in respect of that
competent authority.
5.1.9 NYSE Listing. The NYSE shall have approved the listing on
the NYSE of either the SVT Shares or the P&O Princess Special Share, subject in
either case only to official notice of issuance.
5.2 Conditions to Obligations of P&O Princess to Effect the Closing.
The obligation of P&O Princess to effect the Closing and the DLC Transactions is
also subject to the satisfaction or waiver by P&O Princess prior to the
Effective Time of the following conditions:
5.2.1 Representations and Warranties of Carnival. The
representations and warranties of Carnival set forth in this Agreement (i) to
the extent qualified by Material Adverse Effect or any other materiality
qualification shall be true and correct and (ii) to the extent not qualified by
Material Adverse Effect or any other materiality qualification shall be true and
correct (provided that this clause (ii) shall be deemed satisfied so long as any
failures of such representations and warranties to be true and correct, taken
together, do not have a Material Adverse Effect on Carnival) as of the date of
this Agreement and as of the Closing Date as though made on and as of the
Closing Date (except to the extent any such representation or warranty expressly
speaks as of an earlier date), and P&O Princess shall have received a
certificate signed on behalf of Carnival by a Carnival Officer to such effect.
5.2.2 Performance of Obligations of Carnival. Carnival shall have
performed in all material respects all obligations required to be performed by
it under this Agreement at or prior to the Closing Date, and P&O Princess shall
have received a certificate signed on behalf of Carnival by a Carnival Officer
to such effect.
5.2.3 Consents Under Agreements. Carnival shall have obtained the
consent or approval of each Person whose consent or approval shall be required
in
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order to consummate the DLC Transactions under any Contract to which Carnival or
any of its Subsidiaries is a party or by which any of its or their assets are
bound, except those the failure of which to obtain such consent or approval,
individually or in the aggregate, is not reasonably likely to have a Material
Adverse Effect on Carnival or prevent the consummation of, or materially
adversely affect, the DLC Transactions by Carnival.
5.2.4 Carnival Special Share. Carnival shall have issued the
Carnival Special Share to Carnival SVC.
5.2.5 Other DLC Documents. Each DLC Document that is required to
be executed and delivered by the parties thereto shall have been so executed and
delivered in the Agreed Form by all such parties other than P&O Princess and its
Subsidiaries.
5.3 Conditions to Obligations of Carnival. The obligation of Carnival
to effect the Closing and the DLC Transactions contemplated by this Agreement is
also subject to the satisfaction or waiver by Carnival prior to the Effective
Time of the following conditions:
5.3.1 Representations and Warranties of P&O Princess. The
representations and warranties of P&O Princess set forth in this Agreement (i)
to the extent qualified by Material Adverse Effect or any other materiality
qualification shall be true and correct; and (ii) to the extent not qualified by
Material Adverse Effect or any other materiality qualification shall be true and
correct (provided that this clause (ii) shall be deemed satisfied so long as any
failures of such representations and warranties to be true and correct, taken
together, do not have a Material Adverse Effect on P&O Princess) as of the date
hereof and as of the Closing Date as though made on and as of the Closing Date
(except to the extent any such representation and warranty expressly speaks as
of an earlier date), and Carnival shall have received a certificate signed on
behalf of P&O Princess by a P&O Princess Officer to such effect.
5.3.2 Performance of Obligations of P&O Princess. P&O Princess
shall have performed in all material respects all obligations required to be
performed by it under this Agreement at or prior to the Closing Date, and
Carnival shall have received a certificate signed on behalf of P&O Princess by a
P&O Princess Officer to such effect.
5.3.3 Consents Under Agreements. P&O Princess shall have obtained
the consent or approval of each Person whose consent or approval shall be
required in order to consummate the DLC Transactions under any Contract to which
P&O Princess or any of its Subsidiaries is a party or by which any of its or
their assets are bound, except those the failure of which to obtain such consent
or approval, individually or in the aggregate, is not reasonably likely to have
a Material Adverse Effect on P&O Princess or prevent the consummation of, or
materially adversely affect, the DLC Transactions by P&O Princess.
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5.3.4 P&O Princess Special Share. P&O Princess shall have issued
the P&O Princess Special Share to Carnival.
5.3.5 Other DLC Documents. Each DLC Document that is required to
be executed and delivered by the parties thereto shall have been so executed and
delivered in the Agreed Form by all such parties other than Carnival and its
Subsidiaries.
5.3.6 Termination of Joint Venture Agreement. P&O Princess shall
have given a termination notice under Section 9.01(c) of the Joint Venture
Agreement or the Joint Venture Agreement shall have been terminated without any
cost to P&O Princess (excluding any existing termination amount set forth in the
Implementation Agreement between P&O Princess and Royal Caribbean Cruises Ltd.,
dated as of November 19, 2001) under Section 9.01(a) thereof.
ARTICLE VI
Termination
6.1 Termination by Mutual Consent. This Agreement may be terminated
and the Transactions may be abandoned at any time prior to the Effective Time,
whether before or after the approvals by shareholders of Carnival and P&O
Princess referred to in paragraph 5.1.1, by mutual written consent of Carnival
and P&O Princess by action of their respective boards of directors.
6.2 Termination by Either P&O Princess or Carnival. This Agreement
may be terminated and the Transactions may be abandoned at any time prior to the
Effective Time by action of the board of directors of either P&O Princess or
Carnival if (i) the Closing and the Transactions shall not have been consummated
by September 30, 2003, whether such date is before or after the date of approval
by the shareholders of Carnival or P&O Princess (the "Termination Date"), (ii)
any Order (which the terminating Party shall have used its reasonable best
efforts to resist, resolve or lift, as applicable, in accordance with Section
4.5) permanently restraining, enjoining or otherwise prohibiting the
consummation of, or materially adversely affecting, the Transactions shall have
become final and non-appealable, whether before or after the approval by the
shareholders of Carnival or P&O Princess, (iii) the Carnival Requisite Vote
shall not have been obtained at the duly held Carnival Shareholders Meeting,
including any adjournments or postponements thereof or, in any event by the date
that is five Business Days prior to the Termination Date, or (iv) the P&O
Princess Requisite Vote shall not have been obtained at the duly held P&O
Princess Shareholders Meeting, including any adjournments or postponements
thereof or, in any event by the date that is five Business Days prior to the
Termination Date; provided that the right to terminate this Agreement shall not
be available to a Party that has breached in any material respect its
obligations under this Agreement in any manner that shall have proximately
contributed to the failure of the Transactions to be consummated.
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6.3 Termination by Carnival. This Agreement may be terminated and the
Transactions may be abandoned at any time prior to the Effective Time, whether
before or after the approval by shareholders of Carnival referred to in
paragraph 5.1.1, by action of the board of directors of Carnival, if (i) the
board of directors of P&O Princess shall have withdrawn or adversely modified
its approval or recommendation to shareholders of this Agreement and the
Transactions or shall have resolved to take any such action or failed to
reconfirm such approval or recommendation within five Business Days after a
written request by Carnival to do so; or (ii) P&O Princess or its board of
directors shall take any of the actions described in clause (ii) of the proviso
to Section 4.2.1; or (iii) there shall be a breach by P&O Princess of any
representation, warranty, covenant or agreement contained in this Agreement, or
any event or circumstance shall occur as a result of which any such
representation and warranty shall not be true as of, and as if made on, any date
after the date hereof, which, in each case, would result in a failure of a
condition set forth in paragraph 5.3.1 or 5.3.2 and cannot be or is not cured
prior to the Termination Date; or (iv) a third party announces a firm intention
(whether or not subject to a pre-condition) to make an offer or Acquisition
Proposal for P&O Princess (including an offer to form a dual-listed company)
which offer is (x) either subject to the City Code or is otherwise legally
binding and (y) in Carnival's reasonable opinion, acting in good faith and after
consultation with its financial advisers, the nature of such advice to be
communicated to P&O Princess, is likely to be more attractive to P&O Princess
Shareholders than the DLC Transactions.
6.4 Termination by P&O Princess. This Agreement may be terminated and
the Transactions may be abandoned at any time prior to the Effective Time,
whether before or after the approval by the shareholders of P&O Princess
referred to in paragraph 5.1.1, by action of the board of directors of P&O
Princess, if (i) the board of directors of Carnival shall have withdrawn or
adversely modified its approval or recommendation to shareholders of this
Agreement and the Transactions, or shall have resolved to take any such action
or failed to reconfirm such approval or recommendation within five Business Days
after a written request by P&O Princess to do so; or (ii) Carnival or its board
of directors shall take any of the actions described in clause (ii) of the
proviso to Section 4.2.1; or (iii) there shall be a breach by Carnival of any
representation, warranty, covenant or agreement contained in this Agreement, or
any event or circumstance shall occur as a result of which any such
representation and warranty shall not be true as of, and as if made on, any date
after the date hereof, which, in each case, would result in a failure of a
condition set forth in paragraph 5.2.1 or 5.2.2 and cannot be or is not cured
prior to the Termination Date.
6.5 Effect of Termination and Abandonment.
6.5.1 Effect of Termination. In the event of termination of this
Agreement and the abandonment of the Transactions pursuant to this Article VI,
this Agreement (other than as set forth in Section 7.1) shall become void and of
no effect with no liability on the part of either Party (or of any of its
Representatives); provided, however, that, subject to Section 7.1, no such
termination shall relieve either Party of any liability for damages resulting
from any breach of this Agreement or from any obligation
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to pay, if applicable, the Carnival Termination Amount (as defined below) or the
P&O Princess Termination Amount (as defined below), as the case may be, pursuant
to Section 6.5.2 or 6.5.3.
6.5.2 Carnival Break Fee. In the event that (i) this Agreement is
terminated by either Carnival or P&O Princess pursuant to Section 6.2(iii) and
at the time of the Carnival Shareholders Meeting an Acquisition Proposal exists
with respect to Carnival; or (ii) this Agreement is terminated by P&O Princess
pursuant to Section 6.4(i), 6.4(ii) or 6.4(iii) (solely with respect to a breach
of Section 4.2), then if any Acquisition Proposal involving Carnival is
implemented or completed on or before the day which is 18 months after the date
of this Agreement, Carnival shall promptly, but in no event later than two days
after the date of such implementation or completion, pay to P&O Princess a
termination payment equal to the Carnival Termination Amount, which amount shall
be exclusive of any expenses to be paid pursuant to Section 4.9, payable by wire
transfer of same day funds. The term "Carnival Termination Amount" shall mean
$49.4 million (representing 1 per cent of the market capitalisation of P&O
Princess on January 7, 2003). Carnival acknowledges that the agreements
contained in this Section 6.5.2 are an integral part of the Transactions, and
that, without these agreements, P&O Princess would not enter into this
Agreement; accordingly, if Carnival fails promptly to pay any amount due
pursuant to this Section 6.5.2, and, in order to obtain such payment, P&O
Princess commences a suit which results in a judgment against Carnival for the
payment set forth in this Section 6.5.2, Carnival shall pay to P&O Princess its
costs and expenses (including attorneys' fees) in connection with such suit,
together with interest on the Carnival Termination Amount from each date for
payment until the date of such payment at the prime rate of Citibank N.A. in
effect on the date such payment was required to be made plus 2 percent.
6.5.3 P&O Princess Break Fee. In the event that (i) this
Agreement is terminated by either Carnival or P&O Princess pursuant to Section
6.2(iv) and at the time of the P&O Princess Shareholders Meeting an Acquisition
Proposal exists with respect to P&O Princess; or (ii) this Agreement is
terminated by Carnival pursuant to Section 6.3(i), 6.3(ii) or 6.3(iii) (solely
with respect to a breach of Section 4.2 then if any Acquisition Proposal
involving P&O Princess is implemented or completed on or before the day which is
18 months after the date of this Agreement, P&O Princess shall promptly, but in
no event later than two days after the date of such implementation or
completion, pay to Carnival a termination payment equal to the P&O Princess
Termination Amount, which amount shall be exclusive of any expenses to be paid
pursuant to Section 4.9, payable by wire transfer of same day funds. The term
"P&O Princess Termination Amount" shall mean $49.4 million (representing 1 per
cent. of the market capitalisation of P&O Princess on January 7, 2003). P&O
Princess acknowledges that the agreements contained in this Section 6.5.3 are an
integral part of the Transactions, and that, without these agreements, Carnival
would not enter into this Agreement; accordingly, if P&O Princess fails promptly
to pay any amount due pursuant to this Section 6.5.3, and, in order to obtain
such payment, Carnival commences a suit which results in a judgment against P&O
Princess for the payment set forth in this Section 6.5.3, P&O Princess shall pay
to Carnival its costs and expenses (including
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attorneys' fees) in connection with such suit, together with interest on the P&O
Princess Termination Amount from each date for payment until the date of such
payment at the prime rate of Citibank N.A. in effect on the date such payment
was required to be made plus 2 percent.
ARTICLE VII
Miscellaneous and General
7.1 Survival. This Article VII and the agreements of Carnival and P&O
Princess contained in Sections 4.8 (Benefits and Other Matters) and 4.9
(Expenses) shall survive the Effective Time. This Article VII (other than
Section 7.2 (Modification or Amendment), Section 7.3 (Waiver of Conditions) and
Section 7.11 (Assignment)), the representations and warranties contained in
Section 3.1.3 (Corporate Authority; Approval and Fairness), the agreements of
Carnival and P&O Princess contained in Section 4.9 (Expenses), Section 6.5
(Effect of Termination and Abandonment) and the last sentence of Section 4.6
(Access) and Section 4.11.7 and 4.11.8 shall survive the termination of this
Agreement. All other representations, warranties, agreements and covenants in
this Agreement shall not survive the Effective Time or the termination of this
Agreement. Notwithstanding the foregoing, no termination of this Agreement shall
relieve any Party from liability for any breach by it of its covenants and
agreements in this Agreement prior to such termination; provided that the sole
remedy of any Party for any breach by the other Party of any representation or
warranty in this Agreement other than those in Section 3.1.3 (Corporate
Authority; Approval; and Fairness) shall be the right (if any) to terminate this
Agreement pursuant to clause (iii) of Section 6.3 or Section 6.4, as applicable.
7.2 Modification or Amendment. This Agreement may be modified or
amended by agreement of the Parties, by action taken or authorized by their
respective boards of directors, at any time prior to the Effective Time;
provided, however, that, after approval by shareholders of the matters presented
at the Carnival Shareholders Meeting or the P&O Princess Shareholders Meeting,
no modification or amendment shall be made which under applicable Law requires
further approval by such shareholders without such further approval. This
Agreement may not be modified or amended except by an instrument in writing
executed and delivered by duly authorized officers of each of the Parties.
7.3 Waiver of Conditions. Any provision of this Agreement may be
waived prior to the Effective Time if, and only if, such waiver is in writing
and signed by the Party against whom the waiver is to be effective. For the
purposes of Article V, P&O Princess may waive any condition contained in Section
5.2 and Carnival may waive any condition contained in Section 5.3.
7.4 Failure or Indulgence Not Waiver; Remedies Cumulative. No failure
or delay by any Party in exercising any right, power or privilege hereunder
shall operate as a waiver thereof, nor shall any single or partial exercise
thereof preclude any
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other or further exercise thereof or the exercise of any other right, power or
privilege. Except as otherwise herein provided, the rights and remedies herein
provided shall be cumulative and not exclusive of any rights or remedies
provided by Law.
7.5 Counterparts. This Agreement may be executed in any number of
counterparts, each such counterpart being deemed to be an original instrument,
and all such counterparts shall together constitute the same agreement.
7.6 GOVERNING LAW AND VENUE; WAIVER OF JURY TRIAL.
7.6.1 Governing Law And Venue. THIS AGREEMENT SHALL BE DEEMED TO
BE MADE IN, AND IN ALL RESPECTS SHALL BE INTERPRETED, CONSTRUED AND GOVERNED BY
AND IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK APPLICABLE TO CONTRACTS
TO BE PERFORMED WHOLLY IN SUCH STATE. The Parties hereby irrevocably submit to
the jurisdiction of the Federal courts of the United States of America located
in the Borough of Manhattan, New York State solely (or, if such jurisdiction is
refused by such Federal courts, the Supreme Court of the State of New York,
located in the Borough of Manhattan) in respect of the interpretation and
enforcement of the provisions of this Agreement and in respect of the
Transactions and thereby waive, and agree not to assert, as a defense in any
action, suit or proceeding for the interpretation or enforcement hereof, that it
is not subject thereto or that such action, suit or proceeding may not be
brought or is not maintainable in said courts or that the venue thereof may not
be appropriate or that this Agreement may not be enforced in or by such courts,
and the Parties irrevocably agree that all claims with respect to such action or
proceeding shall be heard and determined in such a Federal court. The Parties
hereby consent to and grant any such court jurisdiction over the person of such
Parties and over the subject matter of such dispute and agree that mailing of
process or other papers in connection with any such action or proceeding in the
manner provided in Section 7.7 (Notices), or in such other manner as may be
permitted by Law, shall be valid and sufficient service thereof.
7.6.2 WAIVER OF JURY TRIAL. EACH PARTY ACKNOWLEDGES AND AGREES
THAT ANY CONTROVERSY WHICH MAY ARISE UNDER THIS AGREEMENT IS LIKELY TO INVOLVE
COMPLICATED AND DIFFICULT ISSUES, AND THEREFORE EACH SUCH PARTY HEREBY
IRREVOCABLY AND UNCONDITIONALLY WAIVES ANY RIGHT SUCH PARTY MAY HAVE TO A TRIAL
BY JURY IN RESPECT OF ANY LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT OF OR
RELATING TO THIS AGREEMENT OR THE "TRANSACTIONS." EACH PARTY CERTIFIES AND
ACKNOWLEDGES THAT (I) NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY
HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE
EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER, (II) EACH SUCH PARTY
UNDERSTANDS AND HAS
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CONSIDERED THE IMPLICATIONS OF THIS WAIVER, (III) EACH SUCH PARTY MAKES THIS
WAIVER VOLUNTARILY, AND (IV) EACH SUCH PARTY HAS BEEN INDUCED TO ENTER INTO THIS
AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS
SECTION 7.6.
7.7 Notices. Notices, requests, instructions or other documents
to be given under this Agreement shall be in writing and shall be deemed given,
(i) when sent if sent by facsimile, provided that the facsimile is promptly
confirmed by telephone confirmation thereof or (ii) when delivered, if delivered
personally to the intended recipient or sent by overnight delivery via a
national courier service, and in each case, addressed to a Party at the
following address for such Party:
if to Carnival:
Carnival Corporation
0000 X.X. 00xx Xxxxxx
Xxxxx, Xxxxxxx 00x00-0000
Attention: Chairman and Chief Executive Officer
Facsimile: (000) 000-0000
with copies to
Carnival Corporation
0000 X.X. 00xx Xxxxxx
Xxxxx, Xxxxxxx 00000-0000
Attention: General Counsel
Facsimile: (000) 000-0000
and
Xxxxx X. Xxxxx, Esq.
Xxxx, Weiss, Rifkind, Xxxxxxx & Xxxxxxxx LLP
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
Facsimile: (000) 000-0000
and
Xxxxxxx Xxxxxxxx
Xxxxxxx Xxxxx
Xxxxxxxx Xxxxxx
Xxxxxxxx Xxxxxx
Xxxxxx XX0X 0XX
Facsimile: (44) 00-0000 0000
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if to P&O Princess:
P&O Princess Cruises plc
00 Xxx Xxxxxx Xxxxxx
Xxxxxx XX0X 0XX
Attention: Chief Executive Officer
Facsimile: (00) 00-0000-0000
with copies to
P&O Princess Cruises plc
00 Xxx Xxxxxx Xxxxxx
Xxxxxx XX0X 0XX
Attention: General Counsel
Facsimile: (00) 00-0000-0000
Xxxxxx X. XxXxxxxxx, Esq.
Xxxxxxxx & Xxxxxxxx LLP
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Facsimile: (000) 000-0000
and
Xxxx Xxxxxxxxx
Freshfields Bruckhaus Xxxxxxxx
00 Xxxxx Xxxxxx
Xxxxxx XX0X 0XX
Facsimile: (00) 00-0000-0000
or to such other Persons or addresses as may be designated in writing by the
Party to receive such notice as provided above.
7.8 Entire Agreement. This Agreement (including the exhibits,
annexes and schedules hereto), the Carnival Disclosure Letter, the P&O Princess
Disclosure Letter, the Stockholder Voting Agreement and the Confidentiality
Agreement constitute the entire agreement, and supersede all other prior
agreements, understandings, representations and warranties both written and
oral, between the Parties with respect to the subject matter hereof. References
herein to this Agreement shall for all purposes be deemed to include references
to the Carnival Disclosure Letter and the P&O Princess Disclosure Letter. Except
as set forth in Section 4.8.1, this Agreement is not intended to confer upon any
Person other than the Parties any rights or remedies hereunder except the
individuals who were directors of either Party on or prior to the Effective Time
shall be deemed third party beneficiaries with respect to Section 4.8, as
applicable. No employee or former employee of Carnival or P&O Princess who is
not a director of Carnival or P&O Princess shall be deemed a third party
beneficiary with respect to any provision of this Agreement. EACH PARTY HERETO
AGREES THAT, EXCEPT FOR THE
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REPRESENTATIONS AND WARRANTIES CONTAINED IN THIS AGREEMENT OR ANY OTHER
AGREEMENT CONTEMPLATED HEREBY, NEITHER CARNIVAL NOR P&O PRINCESS MAKES ANY OTHER
REPRESENTATIONS OR WARRANTIES, AND EACH HEREBY DISCLAIMS ANY OTHER
REPRESENTATIONS OR WARRANTIES MADE BY ITSELF OR ANY OF ITS OFFICERS, DIRECTORS,
EMPLOYEES, AGENTS, FINANCIAL AND LEGAL ADVISORS OR OTHER REPRESENTATIVES WITH
RESPECT TO THE EXECUTION AND DELIVERY OF THIS AGREEMENT, OR THE "TRANSACTIONS",
NOTWITHSTANDING THE DELIVERY OR DISCLOSURE TO THE OTHER OR THE OTHER'S
REPRESENTATIVES OF ANY DOCUMENTATION OR OTHER INFORMATION WITH RESPECT TO ANY
ONE OR MORE OF THE FOREGOING.
7.9 Severability. The provisions of this Agreement shall be deemed
severable and the invalidity or unenforceability of any provision shall not
affect the validity or enforceability of the other provisions hereof. If any
provision of this Agreement, or the application thereof to any Person or any
circumstance, is invalid or unenforceable, (a) a suitable and equitable
provision shall be substituted therefor in order to carry out, so far as may be
valid and enforceable, the intent and purpose of such invalid or unenforceable
provision unless the substitution of such provision would materially frustrate
the express intent and purposes of this Agreement or the Equalization and
Governance Agreement and (b) the remainder of this Agreement and the application
of such provision to other Persons or circumstances shall not be affected by
such invalidity or unenforceability, nor shall such invalidity or
unenforceability affect the validity or enforceability of such provision, or the
application thereof, in any other jurisdiction.
7.10 Interpretation. The table of contents and headings herein are for
convenience of reference only, do not constitute part of this Agreement and
shall not be deemed to limit or otherwise affect any of the provisions hereof.
Where a reference in this Agreement is made to a Section or Exhibit, such
reference shall be to a Section of or Exhibit to this Agreement unless otherwise
indicated. Whenever the words "include," "includes" or "including" are used in
this Agreement, they shall be deemed to be followed by the words "without
limitation." As used herein with respect to any Party, a matter shall be deemed
to be "material" only if it is material to the Party and its Subsidiaries taken
as a whole. A reference to any agreement or document is to that agreement or
document as amended, novated, supplemented, varied or replaced from time to
time, except to the extent prohibited by this Agreement. A reference to any
legislation (including any listing rules of a stock exchange or voluntary codes)
or to any provision of any legislation includes any modification or re-enactment
of it, any legislative provision substituted for it and all rules and
regulations and statutory instruments promulgated and issued under it. Nothing
in this Agreement or the DLC Documents will mean or be taken to imply that P&O
Princess or Carnival have agreed to dispose of or to acquire any interest in the
assets or undertakings of either of them. The parties hereto acknowledge that
this Agreement (including the Exhibits and Schedules hereto) has been drafted
jointly by the parties hereto and agree that this Agreement will
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not be construed against any party as a result of any role such party may have
had in the drafting process.
7.11 Assignment. This Agreement shall not be assignable by operation
of law or otherwise, and any purported assignment in violation of this provision
shall be void.
7.12 No Partnership. Neither this Agreement nor the DLC Transactions
are intended for any legal, tax or other purpose to (i) alter the status of P&O
Princess and Carnival as separate, independent entities (taxed respectively and
exclusively as a United Kingdom and a Panamanian non-resident corporation), (ii)
result in any of Carnival, P&O Princess, their respective Subsidiaries, or their
respective shareholders being treated as creating an entity or otherwise
entering into any partnership, joint venture, association or agency
relationship, or (iii) give either Party (or its respective Subsidiaries or
shareholders) any legal or beneficial ownership interest in the assets or income
of the other Party, and shall not be construed as having such effect.
7.13 Special Shares. The parties agree for all United States federal
income tax purposes to treat both the Carnival Special Share and the P&O
Princess Special Share as not constituting stock or any other equity interest in
Carnival or P&O Princess or any other entity.
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IN WITNESS WHEREOF, this Agreement has been duly executed and
delivered by the duly authorized officers of Carnival and P&O Princess as of the
date hereof.
CARNIVAL CORPORATION
By: /s/ Xxxxx Xxxxxx
----------------------------------------------
Name: Xxxxx Xxxxxx
Title: Chairman & Chief Executive
Officer
P&O PRINCESS CRUISES PLC
By: /s/ Xxxxx X. Xxxxxxxxx
----------------------------------------------
Name: Xxxxx X. Xxxxxxxxx
Title: Chief Executive Officer
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