Tender-Offer Statement — Third-Party Tender Offer — Schedule TO
Filing Table of Contents
Document/Exhibit Description Pages Size
1: SC TO-T Tender Offer Statement 6 41K
2: EX-99.A.1 U.S. Offer to Purchase 88 455K
11: EX-99.A.10 Press Release 2 14K
12: EX-99.A.17 Summary of the Mexican Offer to Purchase 1 8K
3: EX-99.A.2 Form of Gds Letter of Transmittal 13 68K
4: EX-99.A.3 Form of Broker Dealer Letter 3 21K
5: EX-99.A.4 Form of Client Letter 4 19K
6: EX-99.A.5 Notice of Guaranteed Delivery 3 19K
7: EX-99.A.6 W-9 Guidelines 4± 18K
8: EX-99.A.7 Summary Advertisement 6 36K
9: EX-99.A.8 Audited Consolidated Financial Statements 53 296K
10: EX-99.A.9 Gemex 6-K 12 36K
13: EX-99.B.1 Senior Credit Agreement 75 277K
14: EX-99.C.1 Salomon Smith Barney Inc. Fairness Opinion 3 16K
15: EX-99.C.2 Presentation to the Board of Directors HTML 34K
16: EX-99.D.1 Agreement to Tender 21 70K
17: EX-99.D.2 Agreement to Tender 35 111K
18: EX-99.D.3 Escrow Agreement 9 36K
EX-99.D.2 — Agreement to Tender
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Exhibit (d)(2)
AGREEMENT TO TENDER
AGREEMENT TO TENDER (this "Agreement"), dated as of October 4, 2002,
among PBG Grupo Embotellador Hispano-Mexicano S.L., a Spanish limited liability
company ("PBG Hispano"), Bottling Group, LLC, a Delaware limited liability
company ("BG" and together with PBG Hispano, the "Bidder") and Enrique C. Molina
Sobrino ("Molina").
W I T N E S S E T H
WHEREAS, Bidder is interested in acquiring for cash all of the issued
and outstanding series B shares, without par value (the "Shares"), certificates
of participation, ("CPOs") and Global Depositary Shares ("GDSs"), together, in
each case, with any coupon representing unpaid dividends as of the day of
commencement of the Offers (as defined below), of Pepsi-Gemex, S.A. de C.V. (the
"Company"), a corporation organized under the laws of Mexico, pursuant to one or
more concurrent tender offers in Mexico and the United States (each an "Offer"
and collectively, the "Offers");
WHEREAS, as of the date hereof Molina and the Molina Shareholders (as
defined below) own, directly or indirectly, 73,750 GDSs, 200,438,030 CPOs and
331,000 Shares, representing approximately 40.0% of the total capital stock of
the Company, which CPO amount and ownership percentage shall be increased by the
number of CPOs which Molina purchases upon the exercise of any of his vested
options, as provided herein (collectively, the "Owned Securities");
WHEREAS, in order to induce Bidder to commence the Offers, Bidder has
requested and Molina has agreed to enter into this Agreement.
NOW, THEREFORE, in consideration of the foregoing and the premises and
the mutual representations, warranties, covenants and agreements contained
herein, and on the terms and subject to the conditions set forth herein, and
intending to be legally bound the parties agree as follows:
ARTICLE I
DEFINITIONS
Section 1.1 SPECIFIC DEFINITIONS. As used in this Agreement, the
following terms shall have the meanings set forth or referred to below:
"Affiliate" of a specified Person means any entity which such Person
directly or indirectly through one or more intermediaries Controls, or is
Controlled by, or is under common Control with the specified Person or, in the
case of individuals, persons related by blood or marriage including former
marriage. For purposes of this Agreement, neither the Company nor any of its
Subsidiaries shall be considered to be an Affiliate of Molina or the
Molina/PepsiCo
Gemex Shares Trust. The Molina/PepsiCo Gemex Shares Trust (as defined below)
shall not be considered an Affiliate of PepsiCo.
"Alternative Transaction" has the meaning set forth in Section 3.3(a).
"Area" has the meaning set forth in Section 3.3(b)(i).
"Business" has the meaning set forth in Section 3.3(c)(i).
"Business Day" means a day that is a "business day" as defined under
Regulation 14D under the Exchange Act and that is not a legal holiday in Mexico.
"CNBV" means the Comision Nacional Bancaria y de Valores of Mexico.
"Competitive Activities" has the meaning set forth in Section
3.3(b)(i).
"Confidential Information" has the meaning set forth in Section 3.3(d).
"Consolidated Adjusted Net Debt" as of any date shall mean all
short-term and long-term indebtedness, including obligations under capital
leases, but not including accrued interest, of the Company and its Subsidiaries
on a consolidated basis as of such date, reduced by the sum of (i) the
consolidated cash and cash equivalents of the Company and its Subsidiaries as of
such date, (ii) an amount equal to Ps.172,708,000 and (iii) the aggregate amount
not yet received as cash as of such date by the Company from the employees of
the Company and/or its Subsidiaries representing the aggregate unpaid strike
price of their vested options to acquire securities of the Company (assuming all
of such vested options whether exercised or not are included in calculating the
Offer Price). For purposes of this calculation, all dollar denominated
indebtedness of the Company and its Subsidiaries shall be converted to Pesos
calculated at the average of the exchange rates reported on each of the five (5)
consecutive U.S. Business Days ending two (2) U.S. Business Days prior to the
commencement of the Offers by Reuters and Bloomberg on their FXBENCH page as the
closing rate for the exchange of Pesos and dollars.
"Consolidated Adjusted Working Capital" as of any date shall mean (A)
the consolidated current assets of the Company and its Subsidiaries as of such
date, other than the consolidated cash and cash equivalents of the Company and
its Subsidiaries used to compute Consolidated Adjusted Net Debt (as described
above) as of such date, less (B) the consolidated current liabilities of the
Company and its Subsidiaries as of such date, other than (i) the principal
amount of short-term indebtedness and the principal amount of the current
portion of long-term indebtedness as of such date and (ii) dividends payable as
of such date.
"Control" (including, with correlative meaning, the terms
"Controlling," "Controlled by" and "under common Control with") means the
possession, directly or indirectly, of the power to direct or cause the
direction of the management and policies of such Person, whether through the
ownership of voting securities, by contract or otherwise.
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"CPO" means an ordinary certificate of participation of the Company,
issued by Banco Nacional de Mexico, S.A. as trustee, which represents one series
B share, one series D share and one series L share, each without par value, of
the Company.
"Escrow Agent" means The Bank of New York, as escrow agent under the
Escrow Agreement.
"Escrow Agreement" shall mean the escrow agreement entered concurrently
herewith among Bidder, Molina and the Escrow Agent, substantially in the form
attached hereto as Exhibit A.
"Escrow Amount" has the meaning set forth in Section 4.1.
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
"Expiration Date" means the date that the Mexican Offer and/or the U.S.
Offer, as the case may be, expires.
"GDS" or "Global Depository Shares" means each Global Depositary Share
issued pursuant to the Amended and Restated Deposit Agreement dated as of
September 15, 1998 between the Company and The Bank of New York, as Depositary,
each of which in turn represents six CPOs.
"Indemnified Parties" has the meaning set forth in Section 8.1(a).
"Law" means any law, rule, regulation or order of any competent
governmental or regulatory authority, court or securities exchange, including
the Mexican Securities Markets Law, and any other regulations or rules or
applicable decrees issued thereunder, as amended from time to time.
"Legal Requirements" has the meaning set forth in Section 5.2.
"Material Adverse Change" shall mean any material adverse effect on the
financial condition, business, properties, franchises, licenses, assets,
liabilities or results of operation of the Company and its Subsidiaries, taken
as a whole.
"Mexican Securities Markets Law" means the Mexican Ley del Mercado de
Valores.
"Mexico" shall mean The United Mexican States.
"Mexican Offer" means the portion of the Offers that will be conducted
in, and in accordance with the securities regulations of, Mexico through the
Bolsa Mexicana de Valores, S.A. de C.V.
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"Molina/PepsiCo Gemex Shares Trust" shall mean the Delaware statutory
business trust formed by Molina, PepsiCo and other parties pursuant to a trust
agreement, dated October 6, 1995.
"Molina Securities" has the meaning set forth in Section 3.1.
"Molina Shareholders" are Molina and the other Persons listed on
Schedule 5.3.
"Offer" has the meaning set forth in the recitals.
"Offers" has the meaning set forth in the recitals.
"Offer Conditions" has the meaning set forth in Section 2.3.
"Offer Price" has the meaning set forth in Section 2.1.
"Orders" has the meaning set forth in Section 5.2.
"Owned Securities" has the meaning set forth in the recitals.
"Pension Plan" has the meaning set forth in Section 3.6.
"PepsiCo" shall mean PepsiCo, Inc.
"PepsiCo Agreement to Tender" shall mean the agreement between Bidder
and PepsiCo (of which Molina is an express third-party beneficiary), dated as of
October 4, 2002, substantially in the form attached hereto as Exhibit B,
pursuant to which all of the Securities of the Company owned, directly or
indirectly, or which may be acquired on or before the Expiration Date, by
PepsiCo and the other PepsiCo Shareholders (as defined therein) are to be
tendered in the Offers.
"Person" means any individual, corporation (including any non-profit
corporation), association, general or limited partnership, organization,
business, limited liability company, firm, governmental entity, joint venture,
estate, trust, unincorporated organization or any other entity, association or
organization.
"Purchase Date" has the meaning set forth in Section 3.3(b).
"SEC" means the United States Securities and Exchange Commission.
"SEC Filings" means filings made by the Company with the SEC pursuant
to the periodic reporting requirements contained in Sections 13(a), 13(c) or
15(d) of the Exchange Act and the rules and regulations promulgated thereunder.
"Securities" shall mean collectively the Shares, CPOs and GDSs.
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"Securities Authorities" shall mean all relevant federal, provincial
and state securities commissions and stock exchange authorities and similar
entities and authorities in the United States and Mexico, including the SEC and
the CNBV.
"Shares" shall have the meaning set forth in the recitals.
"Subsidiary" means any corporation or entity with respect to which a
specified Person (or a Subsidiary thereof) owns a majority of the common stock
(or equity securities) or has the power to vote or direct the voting of
sufficient securities to elect a majority of the directors (or similar Persons)
or any other corporation or entity which consolidates with such Person.
"Tendering Shareholder" means any record or beneficial holder of
Securities who tenders Securities into the Offers.
"Third Party" has the meaning set forth in Section 3.3(a).
"Third Party Claim" has the meaning set forth in Section 8.1(b).
"U.S. Business Day" means a day that is a "business day" as defined
under Regulation 14D under the Exchange Act.
"U.S. Offer" means the portion of the Offers that will be conducted in,
and in accordance with the securities regulations of, the United States of
America.
Section 1.2 OTHER DEFINITIONAL PROVISIONS.
(a) The words "Hereof," "Herein," and "Hereunder" and words of similar
import, when used in this Agreement, refer to this Agreement as a whole and not
to any particular provision of this Agreement.
(b) Terms defined in the singular have a comparable meaning when used
in the plural, and vice versa.
(c) The terms "dollars" and "$" mean United States dollars. The terms
"Ps." and "Pesos" mean Mexican Pesos.
ARTICLE II
TENDER OFFER
Section 2.1 AGREEMENT TO COMMENCE OFFERS. Subject to the provisions of
Section 2.2, Bidder shall commence, on the first Business Day after the date of
this Agreement, Offers to acquire up to 100% of the Securities at a price equal
to (i) in the Mexican Offer and at the election of the offerees, Ps.5.91 per
Share (or Ps.17.73 per CPO) or the dollar equivalent of such Peso amount
calculated as the average of the exchange rates reported on each of the five (5)
consecutive U.S. Business Days ending two (2) U.S. Business Days prior to the
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Expiration Date of the U.S. Offer by Reuters and Bloomberg on their FXBENCH page
as the closing rate for the exchange of Pesos and dollars, and (ii) in the U.S.
Offer, the dollar equivalent of Ps.5.91 per Share (or Ps.106.38 per GDS and
Ps.17.73 per CPO), calculated in the same manner as described in (i), in cash
to each Tendering Shareholder. The Bidder may, in its sole discretion, increase
the per Security price for any reason or decrease it by the amount of all
dividends for which a payment day is announced or published on or before the
Expiration Date and which is payable at any time after the date hereof prior to
the Purchase Date. The price per Security, or any higher or lower amount per
Security as may be paid in the Offers in accordance with the foregoing, is
hereinafter referred to as the "Offer Price." If the Offers are consummated,
Bidder agrees to pay the Offer Price promptly, but in no event later than four
(4) U.S. Business Days after the Expiration Date.
Section 2.2 CONDITIONS TO COMMENCEMENT OF THE OFFERS. Bidder's
obligation to commence the Offers is contingent upon the following conditions:
(a) As of the date of this Agreement, (i) the Company shall have timely
filed all reports required to be filed by it since January 1, 1999 pursuant to
the Exchange Act and the Mexican Securities Markets Law, and each such report
shall have complied as to form in all material respects to the rules and
regulations promulgated under the Exchange Act or the Mexican Securities Markets
Law, as applicable and (ii) at the time of their respective filing (or, if
amended on or prior to five (5) Business Days prior to this Agreement and a copy
of any such amendment has been delivered to Bidder, at the time of the filing of
any such amendment thereof), the Company's SEC Filings as they may have been so
amended shall not have contained untrue statements of material facts or omitted
to state material facts required to be stated therein in order to make the
statements therein, in light of the circumstances in which they were made, not
misleading;
(b) No change, event or development shall have occurred which would
reasonably be expected to cause a Material Adverse Change;
(c) All the representations and warranties of Molina under this
Agreement shall be true and correct in all material respects as of the date
Bidder commences the Offers;
(d) The Company shall, as of the date of the commencement of the
Offers, directly or indirectly through any of its Subsidiaries, own all of the
capital stock of each of its Subsidiaries;
(e) PepsiCo and Bidder shall have executed and delivered the PepsiCo
Agreement to Tender;
(f) Molina, Bidder and the Escrow Agent shall have executed and
delivered the Escrow Agreement;
(g) The properties listed on Schedule 2.2(g) attached hereto shall have
been transferred, by conveyance of title to such real property or equity
ownership of any Person which owns such real property, to the Company;
6
(h) The uniform supply agreement dated March 30, 2000 between Uniform
Design, S.A. de C.V. and the Company shall have been amended in a manner
acceptable to Bidder in its sole discretion or such agreement shall have been
terminated without payment of any penalty, liquidated damage or termination
charge;
(i) The Affiliates of Molina described in Exhibit E attached hereto
shall have released, discharged and forever quitclaimed the Company and its
Affiliates from any and all claims, liabilities or obligations, of any kind or
nature whatsoever in law or in equity, known or unknown, that they ever had, now
have, or may have in the future against the Company or its Affiliates for, upon
or by reason of any matter, cause or thing whatsoever from the beginning of
time, other than the obligations described in Exhibit E;
(j) Molina shall have entered into arrangements, reasonably
satisfactory to Bidder, for the delivery of the Escrow Amount to the Escrow
Agent from the aggregate Offer Price due to Molina and the other Molina
Shareholders for Securities tendered by the Molina Shareholders in the Offers;
and
(k) Guadalupe Basteris shall have executed, before a notary public in
Mexico, a consent in the form attached hereto as Exhibit C.
Section 2.3 CONDITIONS TO THE OFFERS. The Offers documents shall
contain those conditions identified on Exhibit D hereto as conditions to
Bidder's obligation to consummate the Offers (the "Offer Conditions"). The
obligation of Bidder to consummate the Offers and accept for payment, and pay
for, Securities tendered and not withdrawn shall be subject only to the Offer
Conditions. Bidder reserves the right to waive any such conditions.
Section 2.4 MODIFICATIONS AND EXTENSIONS OF THE OFFERS.
(a) Bidder may, subject to compliance with the Exchange Act and the
Mexican Securities Markets Law, modify the terms of the Offers or waive any
Offer Conditions, except that without the express written consent of Molina
(which shall not be unreasonably withheld), Bidder shall not reduce the number
of Securities sought in the Offers, reduce the Offer Price (except as permitted
by Section 2.1), extend the Offers (except as provided in this Section 2.4),
change the form of consideration payable in the Offers or otherwise amend or
modify any material term of the Offers in any manner materially adverse to
Molina.
(b) If on the initial Expiration Date the Offer Conditions have been
satisfied, Bidder reserves the right, in its sole discretion, to extend the
Offers to a date that is not later than five (5) Business Days after the initial
Expiration Date, solely to increase the number of Securities tendered in the
Offers.
(c) If on the initial Expiration Date the Offer Conditions have not
been satisfied or waived, Bidder shall extend the Offers until all the Offer
Conditions have been satisfied or waived, provided that Bidder shall not be
required to extend the Offers to a date that is later than ten (10) Business
Days after the initial Expiration Date. Bidder shall have the right, at its own
election, to further extend the Offers for additional ten (10) Business Days to
a date up to twenty (20) Business Days after the initial Expiration Date.
ARTICLE III
RIGHTS AND OBLIGATIONS OF MOLINA
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Section 3.1 AGREEMENT TO TENDER. In order to induce Bidder to commence
the Offers, Molina agrees, pursuant to the terms and conditions set forth
herein, to tender (and to cause the other Molina Shareholders to tender) in the
Offers and to not withdraw (except as permitted in Section 3.2) all the Owned
Securities and all other Securities directly or indirectly owned by Molina and
the other Molina Shareholders no later than the third Business Day after the
commencement of the Offers, except for Owned Securities in the Molina/PepsiCo
Gemex Shares Trust, Securities which have been pledged as described in Schedule
5.3 and Securities acquired by any of the Molina Shareholders after the date of
this Agreement, which in each case Molina agrees to tender and to cause to be
tendered not less than two (2) Business Days before the initial Expiration Date.
The securities described in the preceding sentence are collectively defined as
the "Molina Securities." Molina further agrees to elect (and to cause the other
Molina Shareholders to elect) to receive the purchase price for the Molina
Securities they tender in the Offers in dollars calculated at the Exchange Rate.
Section 3.2 RIGHT TO RECEIVE MORE COMPETITIVE OFFERS. Nothing in this
Agreement is intended in any way to restrict the Molina Shareholders' ability to
accept more competitive offers and no penalty will be imposed on any Molina
Shareholder that accepts a more competitive offer. Notwithstanding the
provisions of Section 3.1, each of the Molina Shareholders shall have the right
to accept more competitive offers received any time prior to or during the
period that the Mexican Offer and/or the U.S. Offer remain outstanding. In the
event any of the Molina Shareholders has tendered any or all of its Securities,
such Molina Shareholder shall have the right to withdraw any or all of such
Securities at any time during the period that the Mexican Offer and/or the U.S.
Offer remain outstanding in order to accept more competitive offers.
Section 3.3 ALTERNATIVE TRANSACTIONS; CONFIDENTIALITY; NO COMPETITION.
(a) Molina agrees to advise Bidder orally and in writing of any
proposal or request for information he receives, or becomes aware of, in
connection with or relating to an Alternative Transaction (as defined below),
the material terms and conditions of such request, proposal or Alternative
Transaction and the identity of the Person making such request or proposal
within one (1) U.S. Business Day of the receipt of such request, and shall
within such period deliver to Bidder a copy of any such request, proposal or
Alternative Transaction received from such Person in writing. Molina will keep
Bidder informed of the status and details (including amendments or proposed
amendments) of any such request or proposal on a current basis. For purposes of
this Agreement, "Alternative Transaction" means either (i) a transaction or
series of transactions pursuant to which any Person or group of Persons
(including Molina and his Affiliates and excluding any transfers between the
Persons Controlling, under common Control with, or Controlled by Molina) other
than the Company, any of its wholly-owned Subsidiaries, Bidder and any of
Bidder's Subsidiaries (a "Third Party") acquires or would acquire, directly or
indirectly, beneficial ownership (as defined in Rule l3d-3 under the Exchange
Act) of any or all of the Securities, whether from Molina, the Company or
otherwise; or (ii) any other transaction pursuant to which any Third Party
acquires or would acquire, directly or indirectly, assets of the Company (other
than in the ordinary course of business) or control of assets of the Company or
its Subsidiaries, in any case having a book value of ten percent or more
8
of the Company's total consolidated assets, or for consideration equal to ten
percent or more of the fair market value of all Securities on the date of this
Agreement. Nothing in this Section 3.3(a) shall be interpreted to prohibit
Molina from complying with his fiduciary duties to the Company or require him to
breach any confidentiality obligations to which he may be subject under
applicable law.
(b) Molina undertakes and covenants to Bidder that, from the date of
the purchase of the Molina Securities by Bidder pursuant to the Offers (the
"Purchase Date"), in accordance with the terms of this Agreement, until the
fifth anniversary of the Purchase Date, he will not, for any reason whatsoever,
either individually or as an officer director, stockholder, member, partner,
agent, employee, consultant, principal, advisor, independent contractor,
affiliate or similarly interested party of another business firm, without the
prior written consent of Bidder, directly or indirectly:
(i) Own, lease, manage, operate, control, advise, engage in, or
own stock or otherwise own an equity or economic interest in,
any Person engaged in the manufacture, marketing or wholesale
sales or distribution of beverages which are competitive with
the products manufactured, marketed, sold or distributed by
the Company and its Subsidiaries as of the date hereof
("Competitive Activities") in Mexico (the "Area"); provided
that, notwithstanding the foregoing, nothing in this Section
3.3(b)(i) will restrict or prevent in any manner Molina from
maintaining a purely passive investment in any Person whose
securities are listed on a national securities exchange or the
NASDAQ National Market System and who is engaged in any
Competitive Activities so long as the aggregate interest
represented by such investments does not exceed 4% of any
class of the outstanding debt or equity securities of any such
Person;
(ii) Divert or attempt to divert from the Company or its
Subsidiaries Persons who are customers or suppliers of the
Company and its Subsidiaries as of either the date hereof or
the Purchase Date; or
(iii) Use (A) in the Area, the name of the Company or any of its
Subsidiaries or any trade names, licenses, labels, customers'
lists, logos or trademarks previously or currently used or
owned by the Company or any of its Subsidiaries in connection
with the products of the Company or any of its Subsidiaries,
or any other logos or trademarks substantially similar to any
of the aforementioned logos or trademarks and (B) anywhere in
the world, any of the trade secrets of the Company or any of
its Subsidiaries related to prospective marketing, sales and
product packaging plans; provided, however, that this clause
(iii)(B) shall no longer be applicable after the first
anniversary of the Purchase Date.
(c) Molina undertakes and covenants to Bidder that he will not, for any
reason whatsoever, either individually or as an officer, director, stockholder,
member, partner, agent,
9
employee, consultant, principal, advisor, independent contractor, affiliate or
similarly interested party of another business firm, without the prior written
consent of Bidder, directly or indirectly:
(i) From the Purchase Date until the third anniversary of the
Purchase Date, solicit for employment, hire or do any act
intended to divert any of the employees listed in Schedule
3.3(c)(i) attached hereto from the business of the Company,
its Subsidiaries, Bidder or any Affiliates of any of them (the
"Business"); provided however, that Molina may hire Mr. Luis
Alejandro Bustos Olivares if Mr. Bustos employment is
terminated or constructively terminated by the Company; or
(ii) From the date hereof until the nine month anniversary of the
Purchase Date, disparage, demean, criticize or do any other
act in each case reasonably likely to cause material injury to
the Business or the reputation of the Business.
(d) Molina acknowledges that he and certain of his Affiliates had
access to operating, financial and other information of the Company, its
Subsidiaries and their respective customers including, without limitation,
procedures, business strategies, and prospects and opportunities, techniques,
methods and information about, or received by them, from their customers and
that divulgence will irreparably harm the Company and its Subsidiaries
("Confidential Information"). Molina also acknowledges such Confidential
Information provides the Company and its Subsidiaries with a competitive
advantage (or that it could be used to the disadvantage of the Company or its
Subsidiaries by a competitor). Molina also acknowledges the interest of the
Company and its Subsidiaries in maintaining the confidentiality of such
Confidential Information. Molina shall not, and shall not authorize any Person
acting on his behalf to, divulge, disclose or make known in any way or use for
the individual benefit of any of them or others any of such Confidential
Information. The foregoing is not applicable to such of the Confidential
Information (i) that is in the public domain otherwise than as a result of its
unauthorized disclosure by Molina, his Affiliates or any other person; (ii) that
is necessary or appropriate to be disclosed in making any filing, or in
connection with obtaining any consent or approval, required for the consummation
of the transactions contemplated by this Agreement; or (iii) that is required to
be disclosed in connection with any legal proceedings or applicable law.
Section 3.4 INFORMATION.
(a) Molina agrees to advise and to cause each of his Affiliates or
employees to advise Bidder, within one (1) U.S. Business Day, orally and in
writing of any request for information or comments from any governmental agency
which could impact Bidder's ability to consummate the Offers. Molina agrees to
provide Bidder with the opportunity to review and comment on any of Molina's or
the Company's filings with or correspondence to the Securities Authorities
relating to the Offers or this Agreement and Bidder will have the right to
comment on those filings or correspondence no later than 24 hours after receipt
of such filing or correspondence. Molina shall not be under any obligation to
accept or in any manner address such comments. Bidder shall have the right to
approve (such approval not to be unreasonably withheld) any references to it
contained in such filing or correspondence, provided that any
10
failure to provide specific proposed changes within 24 hours of receipt of such
filing or correspondence shall be deemed to be approval. Molina will make
reasonably efforts to cause the Company to cooperate with Bidder in connection
with the Company's filings and correspondence described in this Section 3.4(a).
(b) Bidder agrees to advise Molina, within one (1) U.S. Business Day,
orally and in writing of any request for information or comments from any
governmental agency which could impact Bidder's ability to consummate the
Offers. Bidder agrees to provide Molina with the opportunity to review and
comment on any of Bidder's filings with or correspondence to the Securities
Authorities relating to the Offers or this Agreement and Molina will have the
right to comment on those filings or correspondence no later than 24 hours after
receipt of such filing or correspondence. Bidder shall not be under any
obligation to accept or in any manner address such comments. Molina shall have
the right to approve (such approval not to be unreasonably withheld) any
references to him contained in any such filing or correspondence, provided that
any failure of Molina to provide to Bidder specific proposed changes in writing
within 24 hours of receipt of such filing or correspondence shall be deemed to
be approval.
(c) Each of Molina and Bidder will make reasonable efforts to include
each other in any oral communications they have with the Securities Authorities
relating to the Offers or this Agreement.
Section 3.5 OPTIONS.
(a) Effective upon the Purchase Date, Molina hereby (i) surrenders to
the Company all his unvested options to acquire securities of the Company and
(ii) releases and forever discharges the Company, Bidder and Affiliates of each
of them from any and all claims, liabilities, losses, demands, rights and/or
causes of action of any kind or nature whatsoever he ever had or he has against
the Company, Bidder and Affiliates of each of them, whether at law or in equity,
direct or indirect, fixed or contingent, whether known or unknown arising out of
his unvested options.
(b) Molina agrees that he will not, at any time after the date hereof,
commence, maintain, prosecute, participate in as a party, or permit to be filed
by any other person on his behalf, any action or proceeding of any kind,
judicial or administrative, in any court or agency against the Company, Bidder
or Affiliates of any of them, with respect to any of his rights to his unvested
options to acquire securities of the Company.
(c) Except with the consent of Bidder, Molina shall not and shall not
authorize, instruct, or take any other action to cause or encourage the Company,
its Board of Directors or its officers or other officials to modify, or consent
to the modification of, any of the terms or conditions of the unvested options
to acquire securities of the Company held by employees of the Company or its
Subsidiaries.
(d) Molina shall exercise all of his vested options to purchase
securities of the Company and tender such securities in the Offers no less than
two (2) Business Days before the initial Expiration Date pursuant to the
provisions of Article III. Molina will make reasonable
11
efforts to cause the Company to advise its employees of their opportunity to
exercise their vested options to acquire securities of the Company and to tender
such securities into the Offers.
Section 3.6 PAYMENT OF BENEFITS.
(a) Molina agrees to accept in full satisfaction of his rights under
the Pension Plan for Executives of Servicios Administrativos Suma, S.A. de C.V.,
a Subsidiary of the Company, (the "Pension Plan") and all other statutory and
severance benefits to which he may become entitled at the time of his voluntary
termination and/or retirement, payment from the Pension Plan in the amount of
Ps.141,150,000. Bidder hereby acknowledges that Molina is entitled to receive
such sum under the Pension Plan and, following the Purchase Date, shall cause
the Pension Plan to promptly remit such sum to Molina after his voluntary
termination or retirement from employment with the Company and its Subsidiaries,
in accordance with the terms of the Pension Plan, but in no event later than
fifteen (15) Business Days after such termination or retirement.
(b) Molina acknowledges that his employment with the Company and/or its
Subsidiaries and all agreements, arrangements and understandings relating
thereto shall terminate on the Purchase Date and upon such termination, Molina
hereby remises, releases, discharges and forever quitclaims, the Company and its
Affiliates from any and all claims, liabilities or obligations, of any kind or
nature whatsoever in law or in equity, known or unknown, that Molina ever had,
now has, or may have in the future against the Company or its Affiliates for,
upon or by reason of any matter, arising from Molina's employment with the
Company and/or its Subsidiaries and all agreements, arrangements and
understandings relating thereto, other than obligations arising under or
contemplated by this Agreement.
(c) Molina agrees that he will not, at any time after the date hereof,
commence, maintain, prosecute, participate in as a party, or permit to be filed
by any other person on his behalf, any action or proceeding of any kind,
judicial or administrative, in any court or agency against the Company, Bidder
or Affiliates of any of them, with respect to any of his rights under the
Pension Plan or any other statutory and severance benefits to which he may
become entitled at the time of his voluntary termination and/or retirement,
unless the payments have not been made timely in accordance with Section 3.6(a)
or Bidder is otherwise in breach of its obligation to pay Molina for the
Securities in the Offers.
Section 3.7 PAYMENT OF DIVIDENDS. If (i) the Offers are consummated,
(ii) Bidder purchases the Molina Securities pursuant to the Offers, and (iii)
the Company either pays, or announces or publishes a day for the payment of, any
dividend or distribution with respect to the Securities prior to the Purchase
Date, Molina shall pay Bidder, within five (5) Business Days after the
Expiration Date, the aggregate amount of all such dividends or distributions
paid or announced to be paid to security holders of the Company (other than
dividends or distributions paid or announced to be paid to The Pepsi Bottling
Group, Inc. or any of its subsidiaries, including Bidder), unless Bidder has
already reduced the per Security price by the aggregate amount of dividends or
distributions paid or announced to be paid with respect to the Securities as
described in Section 2.1. Molina shall enter into arrangements, reasonably
satisfactory to Bidder, for the payment of the aggregate amount of all such
dividends or distributions paid or announced to be paid to security holders of
the Company (other than dividends or distributions paid or announced to be paid
to The Pepsi Bottling Group, Inc. or any of its subsidiaries, including Bidder)
from the aggregate Offer Price due to Molina and the other Molina Shareholders
for Securities tendered by any of the Molina Shareholders in the Offers.
12
Section 3.8 SHAREHOLDERS MEETING.
(a) Molina undertakes and covenants to Bidder that he will recommend to
the Board of Directors of the Company to set the date selected by Bidder (and
communicated by Bidder to Molina in writing), as the date for an ordinary
shareholders meeting to replace and elect new members for such Board of
Directors, subject to the provisions of applicable Laws, the organizational
documents of the Company, any depositary agreements to which the Company is a
party and the CPO Trust Agreement among Banco Nacional de Mexico, S.A., as CPO
Trustee, the Company and the holders and beneficial owners from time to time of
the CPOs.
(b) Molina undertakes and covenants to Bidder to use his reasonable
efforts to cause the Company to publish a notice calling such shareholders
meeting on the date selected by Bidder, subject to the provisions of applicable
Laws, the organizational documents of the Company, any depositary agreements to
which the Company is a party and the CPO Trust Agreement among Banco Nacional de
Mexico, S.A., as CPO Trustee, the Company and the holders and beneficial owners
from time to time of the CPOs.
ARTICLE IV
DELIVERY OF PAYMENTS TO ESCROW AGENT
Section 4.1 DELIVERY OF PAYMENTS TO ESCROW AGENT. If the Offers are
consummated and Bidder purchases the Molina Securities pursuant to the Offers,
the payment of the aggregate Offer Price due to Molina and the other Molina
Shareholders (net of any amount to be delivered pursuant to Section 3.7 hereof)
shall be delivered to Molina and the other Molina Shareholders except for the
dollar equivalent of the sum of Ps.141,150,000 calculated at the exchange rate
set forth in Section 2.1 (the "Escrow Amount") that Molina agrees to cause to be
delivered to the Escrow Agent to be held, pursuant to the terms and conditions
of the Escrow Agreement.
Section 4.2 RELEASE OF PAYMENTS FROM ESCROW AGREEMENT. The Escrow Agent
shall retain the Escrow Amount as security for Molina's indemnification
obligations under Section 8.1 and thereafter release it only pursuant to the
terms of the Escrow Agreement.
ARTICLE V
REPRESENTATIONS AND WARRANTIES OF MOLINA
Molina hereby represents and warrants to Bidder, as follows:
Section 5.1 AUTHORITY. This Agreement constitutes the valid and binding
obligation of Molina, enforceable against him in accordance with its terms.
Section 5.2 NO CONFLICT. Neither the execution, delivery or performance
of this Agreement nor the consummation by him of the transactions contemplated
hereby, subject to compliance with filing and other requirements under
applicable law, will, directly or indirectly
13
(with or without notice or lapse of time): (i) contravene, conflict with, or
result in a violation of any federal, state, local, municipal, foreign,
international, multinational or other administrative order, constitution, Law,
ordinance, principle of common or civil law, regulation, statute or treaty
("Legal Requirements") applicable to him or any other Molina Shareholder, or any
award, decision, injunction, judgment, order, ruling, subpoena or verdict
entered, made or rendered by any court, administrative agency or other
governmental authority or by any arbitrator ("Orders") applicable to him or any
other Molina Shareholder; or (ii) contravene, conflict with, or result in a
violation or breach of any provision of, or give any person the right to declare
a default or exercise any remedy under, or to accelerate the maturity or
performance of, or to cancel, terminate or modify any agreement, contract,
obligation, promise or understanding (whether written or oral and whether
express or implied) applicable to Molina, any other Molina Shareholder or any of
their Affiliates or by which any of their properties or other assets are legally
bound, except in each case, for any contravention, conflict, violation, breach
or right which would not materially impair the ability of Molina to perform his
obligations hereunder. No governmental authority has commenced, or threatened in
writing to commence, any proceeding or action against Molina or any other Molina
Shareholder with respect to the Offers, this Agreement or the transactions
contemplated hereby and no other Person has commenced any action, proceeding,
application or claim against Molina or any other Molina Shareholder with respect
to the Offers, this Agreement or the transactions contemplated hereby, before
any court, governmental, regulatory or administrative agency or commission,
authority or tribunal, domestic, foreign or supranational, in each case, which
would materially impair Molina's ability to perform his obligations under this
Agreement.
Section 5.3 TITLE TO THE MOLINA SECURITIES. As of the date hereof, each
of the Molina Shareholders is the legal and beneficial owner of the type and
number of Securities set forth opposite its name on Schedule 5.3 attached
hereto. The holders of record of such Securities as of the date hereof are also
identified on such Schedule. The Molina Securities have been duly issued, are
fully paid and, except for the Securities in the Molina/PepsiCo Gemex Shares
Trust and the Securities which have been pledged as described in Schedule 5.3,
(i) the Molina Securities are free and clear of any lien, claim, charge,
restriction on transfer, other encumbrance or rights of third parties, and (ii)
there are no shareholder agreements, voting trusts, proxies or other agreements
or understandings with respect to the Molina Securities or the share capital of
the Company which will prohibit, restrict or adversely affect the performance of
Molina's obligations under this Agreement. Upon the purchase of the Molina
Securities pursuant to the Offers, Bidder will own the Molina Securities free
and clear of any lien, claim, charge, restriction on transfer, other encumbrance
or rights of third parties.
Section 5.4 AFFILIATE RELATIONSHIPS. Except for obligations arising
under or contemplated by this Agreement or as set forth in Exhibit E, (i) the
Company and its Affiliates do not have any liabilities or obligations of any
nature (whether accrued, absolute, contingent, unasserted or otherwise), known
or unknown, to Molina or any of his Affiliates and (ii) neither Molina nor any
of his Affiliates has any claim of any kind against the Company or any of its
Subsidiaries or shareholders, members, owners, officers, directors, employees,
any investment banker, financial advisor, attorney, accountant or other
representative of any of them arising under any agreement, arrangement,
understanding or otherwise (either directly or by virtue of an interest in an
entity which has such claim) relating to the Company or any of its
14
Subsidiaries. Exhibit E presents a complete and accurate list of all agreements,
arrangements and understandings between, on the one hand, Molina and/or any of
his Affiliates, and, on the other hand, the Company and/or any of its
Affiliates.
Section 5.5 TERMINATION OF AFFILIATE RELATIONSHIPS. Molina represents
that the Company and its Subsidiaries can terminate each of the agreements,
arrangements and understandings listed on Exhibit E as well as any other
agreement, arrangement and understanding between, on the one hand, Molina and/or
any of his Affiliates, and, on the other hand, the Company and/or any of its
Subsidiaries, without payment of any penalty, liquidated damage or termination
charge.
ARTICLE VI
REPRESENTATIONS AND WARRANTIES OF BIDDER
PBG Hispano and BG represent and warrant to Molina, jointly and
severally, as follows:
Section 6.1 ORGANIZATION AND QUALIFICATION.
(a) PBG Hispano is a Spanish limited liability company duly organized,
validly existing and in good standing under the laws of Spain with full limited
liability company power and authority to own, lease and operate its assets and
to carry on its business as now being and as heretofore conducted.
(b) BG is a limited liability company duly organized, validly existing
and in good standing under the laws of the State of Delaware with full limited
liability company power and authority to own, lease and operate its assets and
to carry on its business as now being and as heretofore conducted.
Section 6.2 AUTHORITY. Each Bidder has all requisite power and
authority to enter into, execute and deliver this Agreement, to perform fully
its obligations hereunder and to consummate the Offers and the transactions
contemplated hereby. The execution, delivery and performance of this Agreement
has been duly authorized by each of PBG Hispano and BG. This Agreement has been
duly executed and delivered by each Bidder and constitutes the valid and binding
obligation of each Bidder, enforceable against each Bidder in accordance with
its terms.
Section 6.3 NO CONFLICT. Neither the execution, delivery or performance
of this Agreement nor the consummation of the transactions contemplated hereby,
including the commencement of the Offers, except as provided in Schedule 6.3,
will, directly or indirectly (with or without notice or lapse of time): (i)
require Bidder to obtain any regulatory approval, action, waiver or consent;
(ii) contravene, conflict with, or result in a violation of, or give any
governmental authority or other person the right to challenge any of the
transactions contemplated by this Agreement or to exercise any remedy or obtain
any relief under, any Legal Requirements or any Orders; or (iii) contravene,
conflict with, or result in a violation or breach of any provision of, or give
any person the right to declare a default or exercise any remedy
15
under, or to accelerate the maturity or performance of, or to cancel, terminate
or modify any agreement, contract, obligation, promise or understanding (whether
written or oral and whether express or implied) applicable to each Bidder or any
of their Subsidiaries or by which any of their properties or other assets are
legally bound. No governmental authority has commenced, or threatened in writing
to commence, any proceeding or action against Bidder or its Affiliates with
respect to the Offers, this Agreement or the transactions contemplated hereby
and no other Person has commenced any action, proceeding, application or claim
against Bidder or its Affiliates with respect to the Offers, this Agreement or
the transactions contemplated hereby, before any court, governmental, regulatory
or administrative agency or commission, authority or tribunal, domestic, foreign
or supranational, in each case, which would materially impair Bidder's ability
to perform its obligations under this Agreement.
Section 6.4 NO KNOWLEDGE OF BREACH. Bidder has no actual knowledge on
the date hereof of any facts or circumstances that cause the representations and
warranties of Molina under Sections 5.4 and 5.5 hereof to be incorrect in any
respect which would entitle Bidder to indemnification pursuant to Section 8.1
for any claims in an aggregate amount in excess of $50,000.
ARTICLE VII
TERMINATION
Section 7.1 TERMINATION. This Agreement may be terminated at any time:
(a) by mutual written consent of Molina and Bidder;
(b) by Molina, if Bidder has not commenced the Offers the first
Business Day following the execution of this Agreement, unless Bidder has not
commenced the Offers within the above time-period as a result of a breach by
Molina of any of his material obligations or agreements under this Agreement;
(c) by Bidder, by giving written notice of such termination to Molina,
if Molina shall have breached any of his material representations, warranties,
covenants or agreements under this Agreement, and such breach shall be incapable
of cure or has not been cured within ten (10) Business Days following the giving
of written notice of such breach to Molina;
(d) by either Molina or Bidder, by giving written notice of such
termination to the other party, if there shall be in effect any Law that
prohibits the consummation of the Offers or any transactions contemplated hereby
or if consummation of the Offers or any the transactions contemplated hereby
would violate any non-appealable final order, decree or judgment of any court or
governmental entity having competent jurisdiction;
(e) by Molina, by giving written notice of such termination to Bidder,
if Bidder shall have breached any of its material representations, warranties,
covenants or agreements under this Agreement and such breach shall be incapable
of cure or has not been cured within ten (10) Business Days following the giving
of written notice of such breach to Bidder;
16
(f) by Molina or Bidder, if the Offers expire or terminate in
accordance with their terms without the purchase of Securities in the Offers; or
(g) by Bidder, following the purchase of the Molina Securities pursuant
to the Offers.
Section 7.2 EFFECT OF TERMINATION. In the event of the termination of
this Agreement in accordance with Section 7.1 hereof, this Agreement shall
thereafter become void and have no effect, and neither party shall have any
liability to the other or its respective Affiliates, directors, officers or
employees, provided that nothing herein will relieve any party from liability
for any breach prior to such termination of any of its representations,
warranties or covenants under this Agreement.
ARTICLE VIII
MISCELLANEOUS
Section 8.1 INDEMNIFICATION.
(a) As the sole and exclusive remedy for any breach of any warranty or
representation made by Molina under Sections 5.4 and 5.5 hereof, Molina agrees
to indemnify Bidder, its Affiliates and the officers, directors, employees,
agents, partners and shareholders of each of them (collectively, the
"Indemnified Parties") for, and hold each Indemnified Party harmless from and
against: (i) any and all damages, losses, claims and other liabilities of any
and every kind, including, without limitation, judgments and costs of
settlement, and (ii) any and all out-of- pocket costs and expenses of any and
every kind, including, without limitation, reasonable fees and disbursements of
counsel for such Indemnified Parties (all of which expenses periodically shall
be reimbursed as incurred), in each case, arising out of or suffered or incurred
in connection with any breach of any warranty or representation made by Molina
under Sections 5.4 and 5.5 hereof only and for no other provisions of this
Agreement or for any other reason; provided, however, that Molina shall not be
liable to Bidder under any circumstances pursuant to this Section 8.1 in an
amount in excess of the sum of Ps.188,200,000.
(b) Bidder shall, with respect to (i) claims asserted in writing
against any Indemnified Party by any third party ("Third Party Claims") and (ii)
any other claims which would entitle Bidder to claim indemnification under this
Section 8.1, give prompt written notice to Molina describing in reasonable
detail any liabilities which might give rise to any such claims for indemnity
under this Section 8.1, provided, however, that any failure to give such notice
will not waive any rights of Bidder to indemnification hereunder, except to the
extent that Molina is actually and materially prejudiced by the failure to so
notify and then only to the extent of damages caused by the failure to notify.
(c) Molina shall be entitled, at his own expense (i) to participate in
the defense of any Third Party Claim, or (ii) to undertake the defense of a
Third Party Claim that is for an amount not in excess of the then existing
Escrow Amount (reduced by the amount of any other outstanding and unresolved or
unpaid claims pursuant to this Section 8.1) and involves solely the
17
payment of money. Molina shall have fifteen (15) Business Days after receipt of
the above-mentioned notice to undertake to conduct and control through counsel
of his own choosing (subject to the written consent of Bidder, which consent
shall not be unreasonably withheld) and at his sole risk and expense, the good
faith settlement which cannot be effected without the written consent of Bidder
in its sole discretion unless such settlement is for an amount not in excess of
the then existing Escrow Amount (reduced by the amount of any other outstanding
and unresolved or unpaid claims pursuant to this Section 8.1 and involves solely
the payment of money) or defense of such claim, and Bidder shall cooperate with
Molina in connection therewith; provided, that Bidder shall be entitled to
participate in such settlement or defense through counsel chosen by it, the fees
and expenses of such counsel shall be borne by Bidder.
(d) Notwithstanding the foregoing, Molina shall not be entitled to
assume the defense of any Third Party Claim if Molina does not give Bidder the
timely written notice of the undertaking referred to in Section 8.1(c)(ii).
(e) So long as Molina is participating in the defense of a Third Party
Claim in good faith or is reasonably defending any Third Party Claim in good
faith with continuity and diligence, Bidder will cooperate with Molina by
providing records and information which are reasonably relevant to such Third
Party Claim, at Molina's expense.
Section 8.2 CONFIDENTIALITY. Bidder and Molina will maintain in
confidence, and will cause their respective Subsidiaries, Affiliates, directors,
officers, employees, advisors, agents and representatives to maintain in
confidence, any written, oral or other information obtained in confidence from
the other party in connection with this Agreement or the transactions
contemplated hereby (including any proposed offers by Bidder to acquire capital
stock of the Company), unless (a) such information is already known to such
party or to others not bound by a duty of confidentiality or such information
becomes publicly available through no fault of such party, (b) the use of such
information is necessary or appropriate in making any filing or obtaining any
consent or approval required for the consummation of the transactions
contemplated by this Agreement or (c) the furnishing or use of such information
is required by legal proceedings or applicable law. Whether or not the
transactions contemplated by this Agreement are consummated, each party will
return or destroy as much of such written information as the other party may
reasonably request.
Section 8.3 FURTHER ASSURANCES. The parties each agree (a) to furnish
upon request to each other such further information, (b) to execute and deliver
to each other such other documents and (c) to do such other acts and things, all
as the other party may reasonably request for the purpose of carrying out the
intent of this Agreement.
Section 8.4 GOVERNING LAW. This Agreement shall be governed by, and
construed and enforced in accordance with, the laws of the State of New York,
regardless of the laws that might otherwise govern under applicable principles
of conflicts of laws thereof.
Section 8.5 FORUM. This Agreement shall be subject to the exclusive
jurisdiction of the Federal Courts for the Southern District of New York and
State courts of New York County in the State of New York. The parties
irrevocably waive, to the fullest extent
18
permitted by law, any objection or immunities to jurisdiction which they may now
or hereafter have (including sovereign immunity, immunity to pre-judgment
attachment, post-judgment attachment and execution) to the laying of venue of
any suit, action or proceeding arising out of or relating to this Agreement or
the transactions contemplated hereby, or any judgment entered by any court in
respect hereof brought in the State of New York, and further irrevocably waive
any claim that any suit, action or proceeding in the Borough of Manhattan, New
York has been brought in an inconvenient forum. For the purpose of proceedings
in the courts described in this Section 8.5, Molina hereby irrevocably
designates CT Corporation as his agent, and in the event that such agent or any
successor shall cease to represent him, Molina shall promptly and irrevocably
designate a successor and notify Bidder thereof, to accept on his behalf service
of any and all process or other documents which may be served in any action or
proceeding in any of such courts. Molina further agrees that (i) service upon
such agent shall constitute valid and effective service upon Molina and that
failure of such agent to give any notice of such service to Molina shall not
affect the validity of such service or any judgment rendered in any action or
proceeding based thereon and (ii) that service of any and all such process or
other documents of Molina may also be effected by registered mail to his address
as set forth in Section 8.14 hereof.
Section 8.6 REMEDIES CUMULATIVE. Except for the indemnity provided
under Section 8.1 in connection with a breach of any warranty or representation
made by Molina under Sections 5.4 and 5.5 hereof, the rights and remedies of the
parties to this Agreement are cumulative and not alternative. Neither any
failure nor any delay by either party in exercising any right, power or
privilege under this Agreement will operate as a waiver of such right, power or
privilege, and no single or partial exercise of any such right, power or
privilege will preclude any other or further exercise of such right, power or
privilege or the exercise of any other right, power or privilege. Except as
provided in Sections 8.1 and 8.17, nothing in this Agreement shall convey any
rights upon any person or entity which is not a party to this Agreement. Bidder
shall not have the right to withhold the release or payment to Molina of the
Escrow Amount except in accordance with the Escrow Agreement for claims made
under Section 8.1 herein.
Section 8.7 ENTIRE AGREEMENT. This Agreement constitutes the full and
entire understanding and agreement between the parties with regard to the
subject matter hereof. This Agreement supersedes all prior agreements and
understandings, written or oral, between the parties with respect to such
subject matter.
Section 8.8 SEVERABILITY. If any provision of this Agreement is held
invalid or unenforceable by any court of competent jurisdiction, the other
provisions of this Agreement will remain in full force and effect. Any provision
of this Agreement held invalid or unenforceable only in part or degree will
remain in full force and effect to the extent not held invalid or unenforceable.
Section 8.9 AMENDMENT. This Agreement may not be amended except by a
written instrument signed by each party hereto.
Section 8.10 WAIVER. At any time any party hereto may (a) extend the
time for the performance of any of the obligations or other acts of any other
party hereto or (b) waive compliance with any of the agreements of any other
party or any conditions to his or its own
19
obligations, in each case, only to the extent such obligations, agreements and
conditions are intended for its benefit; PROVIDED, HOWEVER, that any such
extension or waiver is set forth in a writing executed by such party.
Section 8.11 BINDING EFFECT; NO ASSIGNMENT. This Agreement shall be
binding upon and inure to the benefit of the parties and their respective
successors and permitted assigns. This Agreement and either party's rights or
obligations hereunder may not be assigned or delegated without the prior written
consent of the other party hereto, except that Bidder may assign in whole or in
part, the right (but not the Bidder's obligation) to purchase the Securities to
one or more of its Affiliates.
Section 8.12 EXPENSES. Whether or not the purchase and sale of the
Securities is consummated, each party shall pay all costs and expenses that he
or it incurs with respect to the negotiation, execution, delivery and
performance of the Agreement and consummation of the transactions contemplated
hereby.
Section 8.13 COUNTERPARTS; HEADINGS. This Agreement may be executed in
two counterparts, each of which shall be an original, but which together shall
constitute one and the same instrument. The descriptive headings of the several
sections and paragraphs of this Agreement are inserted for reference only and
shall not limit or otherwise affect the meaning hereof.
Section 8.14 NOTICES. Any and all notices or other communications or
deliveries required or permitted to be given under any of the provisions of this
Agreement shall be in writing and shall be deemed to have been duly given (i)
five days after the mailing thereof by registered mail, return receipt
requested, (ii) on the day following mailing when sent by overnight express mail
or courier, signature required, and (iii) at the actual time of receipt when
delivered personally, addressed to Molina or Bidder at the addresses set forth
below (or at such other address as any party may specify by notice to the other
parties hereto given as aforesaid):
If to Molina, to:
Campos Eliseos No. 345
Col. Polanco
11550 Mexico, D.F.
Mexico
Phone: (011-5255) 5280-8111
Fax: (011-5255) 5280-5116
With a copy to:
Fried, Frank, Harris, Shriver & Jacobson
One New York Plaza,
New York, NY 10004
Attn: Lee S. Parks, Esq.
Phone: (212) 859-8000
20
Fax: (212) 859-4000
If to Bidder, to:
c/o The Pepsi Bottling Group, Inc.
1 Pepsi Way
Somers, NY 10589
Attn: Senior Deputy General Counsel
Phone: (914) 767-7971
Fax: (914) 767-7944
With a copy to:
Proskauer Rose LLP
1585 Broadway
New York, NY 10036
Attn: Carlos E. Martinez, Esq.
Phone:212-969-3000
Fax:212-969-2900
Section 8.15 SPECIFIC PERFORMANCE. Except for the indemnity provided
under Section 8.1 in connection with a breach of any warranty or representation
made by Molina under Sections 5.4 and 5.5 hereof, without limiting the rights of
each party hereto to pursue other legal and equitable rights available to such
party for any other party's failure to perform its obligations under this
Agreement, the parties hereto acknowledge and agree that the remedy at law for
any failure to perform their obligations hereunder would be inadequate and that
each of them shall be entitled to specific performance, injunctive relief or
other equitable remedies in the event of any such failure. To the extent any
party may be entitled to the benefit of any provision of law requiring any party
in any suit, action or proceeding arising out of or in connection with this
Agreement or any of the transactions contemplated hereby to post security for
litigation costs or otherwise post a performance bond or guaranty or to take any
similar action, each party hereby irrevocably waives such benefit in each case
to the fullest extent now or hereafter permitted under the laws of any such
other jurisdiction.
Section 8.16 SURVIVAL. Except for (a) the representations of Molina set
forth in Section 5.3 with respect to title to the Molina Securities which shall
survive indefinitely in the event Bidder purchases the Molina Securities
pursuant to the Offers and (b) the provisions of this Article 8 which shall
survive indefinitely whether or not Bidder purchases the Molina Securities
pursuant to the Offers; the representations, warranties and covenants in this
Agreement shall survive for three (3) years after the latest of the consummation
of the Offers or the termination of this Agreement.
Section 8.17 THIRD PARTY BENEFICIARIES. The parties hereto expressly
agree that the Company is a third party beneficiary of Sections 3.5 and 3.6
hereof and that PepsiCo is a third party beneficiary of this Agreement.
21
IN WITNESS WHEREOF, the parties have executed or caused this Agreement to be
executed as of the date first written above.
PBG GRUPO EMBOTELLADOR HISPANO-MEXICANO S.L.
By: /s/ Inigo Madariaga
----------------------------------------------
Name: Inigo Madariaga
Title: Managing Director
BOTTLING GROUP, LLC
By: /s/ Alfred H. Drewes
----------------------------------------------
Name: Alfred H. Drewes
Title: Principal Financial Officer
/s/ Enrique C. Molina Sobrino
----------------------------------------------
ENRIQUE C. MOLINA SOBRINO
EXHIBIT A TO THE AGREEMENT TO TENDER
FORM OF ESCROW AGREEMENT
(See Exhibit (d)(3))
EXHIBIT B TO THE AGREEMENT TO TENDER
FORM OF PEPSICO AGREEMENT TO TENDER
(See Exhibit (d)(1))
EXHIBIT C TO THE AGREEMENT TO TENDER
CONSENT FROM GUADALUPE BASTERIS
3
EXHIBIT D TO THE AGREEMENT TO TENDER
CONDITIONS OF THE CONSUMMATION OF BIDDER'S OFFERS
Bidder will not be required to consummate the Offers if:
(i) less than 90% of all of the outstanding shares of capital
stock of the Company (including shares represented by CPOs and GDSs) on the
Expiration Date are tendered into the Offers on or prior to the Expiration Date
and not withdrawn,
(ii) less than all of the Securities owned by PepsiCo and the
other PepsiCo Shareholders are tendered into the Offers and not withdrawn,
(iii) less than all of the Securities owned by Molina and the
other Molina Shareholders are tendered into the Offers and not withdrawn,
(iv) the conditions to the [Mexican Offer] [U.S. Offer] have
not been satisfied or waived on or before the Expiration Date of the [Mexican
Offer] [U.S. Offer]or the [Mexican Offer] [U.S. Offer ] has been terminated
without the purchase of any Securities, or
(v) at any time before the acceptance of the Securities for
payment, any of the following events occurs:
1. a material breach by Molina of any of the material provisions of
this Agreement, including, without limitation, a breach by Molina
of the representations and warranties in Sections 5.4 and 5.5
hereof;
2. a material breach by PepsiCo of any of the material provisions of
the PepsiCo Agreement to Tender;
3. any regulatory approval, action, waiver or consent required to
consummate the Offers, including any approval of the CNBV, the SEC
or any securities exchange, (a) shall not have been obtained, or
shall have been obtained under conditions or restrictions that
would adversely affect the Mexican Offer, the U.S. Offer or the
Company or its Subsidiaries; (b) shall have been modified in any
material way that would adversely affect the Mexican Offer, the
U.S. Offer or the Company or (c) has been revoked;
4. (a) there shall be pending any action, suit, proceeding or claim
by any person, domestic or foreign, which has a reasonable
likelihood of success, or by any government, governmental
authority or other regulatory or administrative agency or
commission, domestic, foreign or supranational, before any court,
governmental, regulatory or administrative agency or commission,
authority or tribunal, domestic, foreign or supranational, or
there shall be any statute, rule, regulation, order, judgment,
decree or injunction applicable to the Mexican Offer or the U.S.
Offer, by such governmental or administrative bodies, prohibiting,
materially restricting or
4
substantially delaying, or seeking to prohibit, materially
restrict or substantially delay the consummation of the Mexican
Offer or the U.S. Offer, or materially modifying or affecting the
Mexican Offer or the U.S. Offer, or (b) any change, event,
condition or development which has had or would reasonably be
expected to result in a Material Adverse Change;
5. any filings of the Company with the SEC, the CNBV or any
securities exchange shall have contained, at the time of their
respective filings, untrue statements of material facts or omitted
to state material facts necessary to make the statements made
therein, in light of the circumstances in which they were made,
not misleading, and such untrue statements or omissions would
reasonably be expected to cause a Material Adverse Change;
6. any material adverse change in the financial markets, including
without limitation, (a) any general suspension of trading in any
of the Securities on the NYSE or the Mexican Stock Exchange
(except for daily suspensions in accordance with their respective
rules or policies), (b) a declaration of a banking moratorium or
imposition of limitations on the extension of credit generally in
the United States or any adverse change in exchange controls in
the U.S. or Mexico, or (c) any material limitations on the markets
for currency in Mexico;
7. commencement of a war, armed hostilities, military coup d'etat,
acts of terrorism, collapse of the government or other national or
international crisis in each case involving the United States or
Mexico which would reasonably be expected to result in a Material
Adverse Change;
8. the Company or any of its Subsidiaries shall have, at any time
after June 30, 2002, effected any change to their respective
capital structure which would reasonably be expected to result in
a Material Adverse Change, including, without limitation, (a)
issued, sold or otherwise transferred, or proposed to do any of
the foregoing, to any person, any shares of capital stock or other
securities (including options to purchase shares of capital stock
and any debt securities), (b) declared, paid or proposed to
declare or pay any dividend or distribution on the Securities, (c)
altered, or proposed to alter, any material term of any
outstanding security of the Company or any of its Subsidiaries
other than employee stock options consistent with the provisions
of this Agreement, (d) split, combined or otherwise changed, or
authorized or proposed the split, combination or other change of,
the Securities or the Company's or any of its Subsidiaries'
capitalization, and (e) authorized, recommended, proposed or
entered into any merger, consolidation, liquidation, dissolution,
business combination, joint venture, strategic alliance or similar
arrangement involving any material assets, acquisition or
disposition of a material amount of assets or securities, other
than pursuant to the Offers;
9. the Company or any of its Subsidiaries shall have at any time
after June 30, 2002 operated its business otherwise than in the
ordinary course consistent with past practice, including, without
limitation, (a) entered into or invested in a line of
5
business different from those in which the Company or any of its
Subsidiaries was engaged as of June 30, 2002, (b) effected any
material change to its corporate structure, including, without
limitation, the transfer or division of all or a significant
portion of its assets, (c) disposed of, or created liens on, other
than pursuant to credit facilities existing as of June 30, 2002,
any material assets of the Company or any of its Subsidiaries, (d)
voluntarily or involuntarily terminated or modified, in any
material adverse manner, any material agreements, (g) made a
material change in its accounting practices (other than as
required by U.S. or Mexican GAAP) or regulatory compliance
procedures, (e) waived, released, assigned, settled or compromised
any claims or litigation involving amounts or other rights or
assets in excess of $2,000,000, or (f) amended or authorized or
proposed any amendments to the Company's Bylaws or any other
organizational documents;
10. the Company and its Subsidiaries have Consolidated Adjusted Net
Debt in excess of Ps.2,648,353,587 or the Company and its
Subsidiaries do not have Consolidated Adjusted Working Capital of
at least Ps.190,750,000; and
11. any default by the Company or any of its Subsidiaries under any
indebtedness which would reasonably be expected to result in a
Material Adverse Change, or which would, following the purchase of
Securities in the Offers, result in a cross-default under any
indebtedness of PBG or BG.
6
EXHIBIT E TO THE AGREEMENT TO TENDER
(i) List of claims of Molina and/or any of his Affiliates
against the Company or any of its Affiliates or shareholders, members, owners,
officers, directors, employees, any investment banker, financial advisor,
attorney, accountant or other representative of any of them.
(ii) List of all agreements, arrangements and understandings
between, on the one hand, Molina and/or any of his Affiliates, and, on the other
hand, the Company and/or any of its Affiliates.
[Enlarge/Download Table]
MAXIMUM POSSIBLE
CLAIM OR LIABILITY
NAME OF AFFILIATE OF PRODUCT / SERVICE (IN THOUSAND OF
MOLINA PROVIDED WRITTEN CONTRACT MEXICAN PESOS)
------ -------- ---------------- --------------
1. Chevrolet Mexicana, S.A. Fleet (Vehicles and No 195
de C.V. Spare Parts)
2. Immobiliaria Troika Real Estate No 0
3. Ingenio Nueva Sugar Mill No 0
Esperanza de Pujiltic,
S.A. de C.V.
4. Carrocerias Suma, S.A. de Fleet - Trailers (Truck No 416
C.V. bodies and Racks)
5. Granja Buen Agua Real Estate - Garci No 620
Crespo
6. Camiones Del Valle de Fleet No 2,055
Mexico, S.A. de C.V.
(Mercedes Benz)
7. Molienda Sugar Distributor No 0
Azucarera Industrial,
S.A. de C.V./Consorcio
Azucarero CAZE,
S.A. de C.V.
8. Comercializadora Sugar Distributor No 0
Industrial
9. Transportes de Carga Interplant Shipments - No 2,415
Especializada, S.A. - Freight (sugar)
de C.V.
10. Corporacion Comercial y Rental of Two Machines Agreement dated March 0
de Servicios S.A. de C.V. used in production of 18, 2002 between
jugs Corporacion Comercial
y de Servicios S.A. de
C.V and Procesos
Plasticos, S.A. de
[Enlarge/Download Table]
MAXIMUM POSSIBLE
CLAIM OR LIABILITY
NAME OF AFFILIATE OF PRODUCT / SERVICE (IN THOUSAND OF
MOLINA PROVIDED WRITTEN CONTRACT MEXICAN PESOS)
------ -------- ---------------- --------------
C.V.
11. Uniform Design, S.A. de Uniforms Agreement dated March 0
C.V. 30, 2000 between
Uniform Design, S.A.
de C.V. and the
Company
12. Tecnorafia, S.A. de C.V. Plastics, Labels, No 9,429
Shrinkfilm
13. Servicios Corporativos Administrative Services Agreement dated 0
Escorpion, S.A. de C.V./ January 1, 2002 between
Grupo Turistico Servicios Corporativos
Escorpion, S.A. de C.V. Escorpion, S.A. de C.V.and
Servicios Administrativos
Suma, S.A. de C.V.
14. Desarrrollos Corporativos 0
ENMO, S.A. de C.V.
15. Enrique Molina Sobrino Yes 0
16. Enrique Molina Basteris Former CEO of Gemex No 0
17. Patricia Molina Basteris Represents Uniform Design No 0
18. Claudia Molina Basteris Represents Tecnorafia No 0
19. Fernando Molina Sobrino Worked for many years No 0
for different entities
(Emsa, Bepura and
Gemex)
20. La Peninsular Seguros S.A. Insurance 1) Policy for the 0
Company and its
Subsidiaries to
cover the plants
dated May 8, 2002
2) Policy for the
Company and its
Subsidiaries to
cover
2
[Enlarge/Download Table]
MAXIMUM POSSIBLE
CLAIM OR LIABILITY
NAME OF AFFILIATE OF PRODUCT / SERVICE (IN THOUSAND OF
MOLINA PROVIDED WRITTEN CONTRACT MEXICAN PESOS)
------ -------- ---------------- --------------
Employee Group
Insurance dated
January 1, 2002.
21. AeroCorp 0
22. Aerotransportes Privados 0
23. Patricia Molina Basteris Owner of portion of No 0
Acapulco Property
3
SCHEDULE 2.2(g) TO AGREEMENT TO TENDER
PROPERTIES THAT SHALL HAVE BEEN TRANSFERRED TO THE
COMPANY AS A CONDITION OF BIDDER'S OBLIGATION TO COMMENCE THE
OFFERS
(i) Property located at the Federal Highway Mexico-Tehuacan Km
117.5, on Tehuacan, Puebla, Mexico; and
(ii) Lot 15 "C" resulting from the subdivision of the vacant
plot identified as lot 15 "B" located in Cumbres del Llano Largo of the City and
Port of Acapulco, State of Guerrero.
4
SCHEDULE 3.3(c)(i) TO AGREEMENT TO TENDER
LIST OF EMPLOYEES THAT MOLINA SHALL NOT SOLICIT FOR
EMPLOYMENT, HIRE OR DO ANY ACT INTENDED TO DIVERT THEM FROM THE
BUSINESS
[Download Table]
Title Name of Employee
----- ----------------
Director Electropura Bernardo Trueba Murillo
Director Corporativo Nuevos Proyectos Gilberto Terrones Sasso
Director Regional Metropolitana Jose Bustamante Barragan
Director Regional Centro Emilio Sabbatini Rios
Director Corporative Mercadotecnia Oscar Munoz Vidales
Director Regional Noreste Rafael Miyar Luna
Director Corporativo Recursos Humanos Jose Antonio Fernandez Negrete
Director Corporativo Manufactura y Logistica Dionisio Martin Garcia
Director Corporativo Juridico Luis Alejandro Bustos Olivares
Director Corporativo Tecnologias de Informacion Fernando Flores Gutierrez
Director Regional Sureste Roger H. Evia Urbina
Director Regional Sur Ursus Leeg Esquivel
Director Corporativo Administracion y Finanzas Juan Manuel Munoz Martinez
Gerente General Proplasa Luis Rodriguez Longo
Gerente Zona de Administracion y Finanzas Roberto Padron Moncada
Gerente Zona de Manufactura y Logistica Ramon Calvillo Esparza
Gerente Zona de Manufactura y Logistica Juan Antonio Andrade Guzman
Gerente Zona de Ventas Coahuila Eduardo Issac Rosales Munoz
Gerente Corporativo de Proyectos Especiales Domingo Canizo Cosio
Gerente Corporativo de Cuentas Nacionales Humberto Leal Flores
Gerente Zona de Administracion y Finanzas Benjamin Martinez Abrego
Gerente Zona Recursos Humanos Electropura Lorenzo Sierra Ramos
Gerente Corporativo de Contraloria Eduardo Jesus Sayavedra Herrerias
Gerente Zona de Ventas Region Hidalgo Alberto Cesar Perez Ramos
Gerente Zona de Recursos Humanos Bernardo Cabrera Najera
Gerente Zona de Ventas Region II Mario Alberto Dehesa Villafuerta
Gerente Zona de Ventas Region I Raul Estrada Carranza
Gerente Zona Mercados Modernos Arturo Sierra Fojo
Gerente General Epecsa Rafael Covarrubias Lopez
Gerente Zona de Distribucion Eduardo Lopez Portillo Loaiza
Gerente Zona de Ventas Region Izcalli Joel Alfredo Martinez Quintero
Gerente Zona Administracion y Finanzas Alberto Jorge Ramos Burguete
Gerente Zona de Ventas Chihuahua Alejandro Castellanos Luna
Gerente zona de Ventas Refresco Alfredo Solis Rubio
Gerente Zona de Ventas La Laguna Alfredo Torres Ramirez
Gerente Zona de Ventas Refresco Centro Antonio Riveroll Esperon
Gerente Zona de Recursos Humanos Antonio Sarmiento Esquinca
Gerente Zona Logistica y Flota Apolonia Sanchez Sosa
Gerente Zona de Ventas Agua Centro Armando Alvarez Perez
5
[Download Table]
Title Name of Employee
----- ----------------
Gerente Zona Operaciones Foraneas Armando Frigollet Gomez
Gerente Corporativo de Gastos Cooperativos Arturo Castillo Guzman
Gerente Zona Operaciones Metropolitana Arturo Langle Vazquez
Gerente Zona de Desarrollo de Mercados Carlos David Fernandez Perez
Gerente Zona Manufactura Carlos Lerma Bonilla
Gerente Corporativo de Sueldos y Organizacion Carlos Manuel Mendoza Lugo
Gerente Zona Administracion y Finanzas Carlos Mar Mar
Gerente Corporativo de Ingenieria y Proyectos David Pang Castillo
Gerente Zona Administracion y Finanzas Denny Ayala Castillo
Gerente Corporativo de Auditoria Interna Eduardo Gerardo Rios Monroy
Gerente Zona de Ventas Refresco Toluca-Morelos Fernando Luis Remes Tostado
Gerente Zona de Recursos Humanos Francisco Cervera Contreras
Gerente Zona de mercados Modernos Francisco Javier Tatto Garcia
Gerente Zona de Recursos Humanos Francisco Olivaraes Uribe
Gerente Corporativo de Relaciones con Inversionistas Irma Montemayor Schivy
Gerente Zona de Ventas Monterrey Isaias Rosales Munoz
Gerente Zona de Ventas Golfo Jaime Martin de la Torre
Gerente Zona de Ventas Frontera Jesus Manuel Hernandez Aguilar
Gerente Corporativo de Tesoreria Jesus Romo Rocha
Gerente Corporativo de Mercadotecnia Joel Rizo Gutierrez
Gerente Zona de Recursos Humanos Jorge Pulido Cruz
Gerente Coporativo de Planeacion Jose Antonio Morales Bernal
Gerente Corporativo de Compras Jose Luis Almaraz Kladiano
Gerente Zona Desarrollo de Mercado Juan Jose Cabello Wallace
Gerente Corporativo de Logistica Miguel Angel Rodriguez Parra
Gerente Corporativo de Capacitacion y Desarrollo Miriam Piso Reiter
Gerente Zona Manufactura y Logistica Pablo Ibarra Gonzalez
Gerente Zona de Ventas Refresco Guerrero Roberto Anorve Guillen
Gerente Zona de Manufactura y Logistica Roman Baqueiro Ramos
Gerente Zona de Ventas Electropura Ruben Mota Acosta
Gerente Zona de Administracion y Finanzas Samuel Fuentes Perez
Gerente Zona Desarrollo de Mercado Sanchez Munoz Alejandro
Gerente Zona Manufactura y Logistica Sergio Ortiz Flores
Gerente Zona de Distribucion Sergio Sanchez Velasco
Gerente Zona de Ventas Agua Sur Mario Lopez Tinoco
Gerente Zona de Desarrollo de Mercados Alfonso Noriega Ortiz
Gerente Zona de Ventas Refresco Bajio Artemio Rodriguez Larios
Gerente Corporativo de Relaciones Laborales Gabriel Cuevas Estrada
Gerente Corporativo de Cuentas por Cobrar Lusi Antonio Correa Noyola
Gerente General Garci Crespo Jose Kuri Pastjane
Gerente Corporativo Edgar Shaadi Shaadi
Sub-Gerente Corporativo Tomas Ramos
6
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SCHEDULE 6.3 TO AGREEMENT TO TENDER
REGULATORY APPROVALS REQUIRED FOR THE EXECUTION, DELIVERY OR
PERFORMANCE OF THIS AGREEMENT OR THE CONSUMMATION OF THE
TRANSACTIONS CONTEMPLATED IN THIS AGREEMENT
ACTIONS AND APPROVALS BY:
1. THE SEC;
2. THE COMISION NACIONAL BANCARIA Y DE VALORES OF MEXICO;
3. THE MEXICAN STOCK EXCHANGE; AND
4. THE MEXICAN FEDERAL COMPETITION COMMISSION.
Dates Referenced Herein and Documents Incorporated by Reference
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