Registration of Securities (General Form) — Form 10
Filing Table of Contents
Document/Exhibit Description Pages Size
1: 10-12B Form 10 100 444K
2: EX-2.1 Form of Separation and Distribution Agreement 38 170K
3: EX-3.1 Form of Certificate of Incorporation 7 27K
4: EX-3.2 Form of By-Laws of Vlasic Foods International, 12 56K
Inc.
5: EX-9.1 Major Stockholders' Voting Trust Agreement 29 57K
6: EX-10.1 Form of Transition Services Agreement 7 26K
15: EX-10.10 Annual Incentive Plan 11 42K
16: EX-10.11 Director Compensation Plan 14 52K
7: EX-10.2 Form of Benefits Sharing Agreement 27 115K
8: EX-10.3 Form of Swanson Trademark License Agreement 26 94K
9: EX-10.4 Form of Technology Sharing Agreement 13 44K
10: EX-10.5 Form of Tax Sharing and Indemnification Agreement 22 69K
11: EX-10.6 Credit Agreement Dated 2/20/98 99 323K
12: EX-10.7 Personal Choice Plan 5 16K
13: EX-10.8 Deferred Compensation Plan 12 43K
14: EX-10.9 1998 Long-Term Incentive Plan 20 71K
17: EX-21 Subsidiaries of Vlasic Foods International Inc. 1 8K
18: EX-27 Selected Financial Data Schedule 2 12K
EX-10.5 — Form of Tax Sharing and Indemnification Agreement
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EXHIBIT 10.5
FORM OF TAX SHARING AND INDEMNIFICATION AGREEMENT
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THIS IS A TAX SHARING AND INDEMNIFICATION AGREEMENT (the "Agreement"),
dated as of the Effective Date, made by and among Campbell Soup Company, a New
Jersey corporation ("CSC") on behalf of itself and each member of the CSC Group,
Vlasic Foods International Inc., a New Jersey corporation ("Vlasic"), each
member of the Vlasic Group, and their respective successors.
Background
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A. CSC has determined to effect the Distribution pursuant to the
Distribution Agreement;
B. The IRS has issued the IRS Ruling which states the tax treatment
of the Distribution and the Other Transactions;
C. The parties are entering into this Agreement: to insure the
continuing effectiveness of the IRS Ruling; to provide for the parties'
respective liabilities for Taxes; to provide certain indemnities; and to provide
for various administrative matters relating to Taxes including: (1) the
preparation and filing of Tax Returns along with the payment of Taxes shown due
and payable thereon, (2) the retention and maintenance of relevant records
necessary to prepare and file appropriate Tax Returns, as well as the provision
for appropriate access to those records by the parties to this Agreement, (3)
the conduct of audits, examinations, and proceedings by appropriate governmental
entities which could result in a redetermination of Taxes, and (4) the
cooperation of all parties with one another in order to fulfill their duties and
responsibilities under this Agreement and under the Code and other applicable
law; and
D. It is the intent of the parties that CSC shall economically bear
the burden of all Taxes imposed upon or attributable to the members of the
Vlasic Group which Taxes are due under any consolidated, combined or unitary Tax
Return (or group relief or similar arrangement) that includes any member or
members of the Vlasic Group and at least one member of the CSC Group that is not
a member of the Vlasic Group (a "CSC Consolidated Return") and that Vlasic or
the appropriate member of the Vlasic Group shall economically bear the burden of
all Taxes otherwise imposed upon or attributable to the members of the Vlasic
Group.
Terms
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THEREFORE, in consideration of the mutual promises, covenants, and
conditions contained in this Agreement, and intending to be legally bound
hereby, the parties hereto agree as follows:
ARTICLE I
DEFINITIONS
SECTION 1.1 DEFINITIONS. As used in this Agreement (including the
introduction and Background section hereof), the following definitions apply
(such meanings to be equally applicable to both the singular and plural focus of
the terms involved):
ADJUSTMENT means any proposed or final change in the Tax Liability of
a taxpayer.
AFFILIATE means, when used with respect to a specified Person, another
Person that directly, or indirectly through one or more intermediaries, controls
or is controlled by or is under common control with such Person.
AFFILIATED PERSON has the meaning ascribed to such term in the
Investment Company Act of 1940, as amended, and the rules and regulations
promulgated thereunder.
ASSOCIATES has the meaning ascribed to such term in the Securities
Exchange Act of 1934, as amended, and the rules and regulations promulgated
thereunder.
BARBECUE SAUCE BUSINESS means the production and sale of barbecue
sauce.
BEEF PRODUCTS BUSINESS means the production and sale of beef and beef
products.
BENEFICIAL OWNERSHIP has the meaning ascribed to such term in the
Securities Exchange Act of 1934, as amended, and the rules and regulations
promulgated thereunder.
CODE means the Internal Revenue Code of 1986, as amended, and the
Treasury regulations promulgated thereunder, including any comparable successor
legislation.
CSC CONSOLIDATED RETURN has the meaning set forth in paragraph D of
the Background section hereof.
CSC GROUP means, as of any relevant date, CSC and its Subsidiaries,
determined as of such date.
DISQUALIFIED VLASIC STOCK is defined at Section 6.2(a)(iii).
DISTRIBUTION means the distribution of Vlasic common stock to the
holders of CSC capital stock pursuant to the Distribution Agreement.
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DISTRIBUTION AGREEMENT means the Separation and Distribution Agreement
between CSC and Vlasic dated as of _______________.
EFFECTIVE DATE means the date on which the Distribution occurs.
FINAL DETERMINATION means the final resolution of any Tax matter. A
Final Determination shall result from the first to occur of:
1. the expiration of 30 days after the IRS' acceptance of a Waiver
of Restrictions on Assessment and Collection of Deficiency in Tax
and Acceptance of Overassessment on Form 870 or 870-AD (or any
successor comparable form) (the "Waiver"), except as to reserved
matters specified therein, or the expiration of 30 days after
acceptance by any other taxing authority of a comparable
agreement or form under the laws of any other jurisdiction,
including state, local, and foreign jurisdictions; unless, within
such period, the taxpayer gives notice to the other party to this
Agreement of the taxpayer's intention to attempt to recover all
or part of any amount paid pursuant to the Waiver by the filing
of a timely claim for refund;
2. a decision, judgment, decree, or other order by a court of
competent jurisdiction that is not subject to further judicial
review (by appeal or otherwise) and has become final;
3. the execution of a closing agreement under Code section 7121, or
the acceptance by the IRS of an offer in compromise under Code
section 7122, or comparable agreements under the laws of any
other jurisdiction, including state, local, and foreign
jurisdictions; except as to reserved matters specified therein;
4. the expiration of the time for filing a claim for refund or for
instituting suit in respect of a claim for refund that was
disallowed in whole or part by the IRS or any other taxing
authority;
5. the expiration of the applicable statute of limitations; or
6. an agreement by the parties hereto that a Final Determination has
been made.
FRESH MUSHROOMS BUSINESS means the production and sale of fresh
mushrooms.
GROSS ASSETS means, when used with respect to a specified Person, the
fair market value of such Person's assets unencumbered by any liabilities.
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GROUP has the meaning ascribed to such term in the Securities Exchange
Act of 1934, as amended, and the rules and regulations promulgated thereunder.
INDEMNIFIED LIABILITY is defined at Section 8.1.
INDEMNIFIED PARTY is defined at Section 7.1.
INDEMNIFYING PARTIES is defined at Section 7.1.
IRS means the U. S. Internal Revenue Service.
IRS INTEREST RATE means the rate of interest imposed from time to time
on underpayments of income tax pursuant to Code section 6621(a)(2).
IRS RULING means the private letter ruling (together with any
supplements) issued by the IRS in respect of the Ruling Request.
NON-PRIMARY PARTY is defined at Section 4.2(a).
OPINION OF COUNSEL means an opinion of independent tax counsel of
recognized national standing and experienced in the issues to be addressed and
otherwise reasonably acceptable to CSC, which sets forth an Unqualified Tax
Opinion in form and substance satisfactory to CSC. In no event shall CSC be
required to conclude that an opinion is satisfactory if there is any risk,
however remote, that the transaction which is the subject of the opinion will
cause the Distribution or any of the Other Transactions to be taxable to any
extent under the Code in a manner that is inconsistent with the IRS Ruling.
OTHER TRANSACTIONS means the transactions related to the Distribution
and described in Sections III.B., III.C., III.D, III.E and III.F of the Ruling
Request, including all modifications to such transactions reflected in
supplements to the Ruling Request.
PERSON means any natural person, corporation, business trust, joint
venture, association, company, partnership or government, or any agency or
political subdivision thereof.
PICKLE BUSINESS means the production and sale of pickles and related
products.
PRIMARY PARTY is defined at Section 4.2(a).
PROCEEDING is defined at Section 9.2(a).
RESTRICTED PERIOD means the two year period following the Effective
Date.
RETAIL FROZEN FOODS BUSINESS means the production and sale of retail
frozen food products.
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RULING PERIOD means the period commencing on the Effective Date and
ending on the seventh anniversary of the close of the taxable year of CSC in
which the Distribution occurs.
RULING REQUEST means the request for rulings (including all exhibits),
as amended and supplemented, under Section 355 and other provisions of the Code,
as originally filed on behalf of CSC on July 25, 1997, in respect of the
Distribution.
SUBSIDIARY means with respect to CSC or Vlasic, any Person of which
CSC or Vlasic, respectively, controls or owns, directly or indirectly, more than
50% of the stock or other equity interest entitled to vote on the election of
members to the board of directors or similar governing body.
TAXES means all federal, state, local and foreign gross or net income,
gross receipts, withholding, payroll, franchise, transfer, sales, use, value
added, estimated or other taxes of any kind whatsoever or similar charges and
assessments, including all interest, penalties and additions imposed with
respect to such amounts which any member of the CSC Group or the Vlasic Group is
required to pay, collect or withhold, together with any interest and any
penalties, additions or additional amounts imposed with respect thereto.
TAX BENEFIT means a reduction in the Tax Liability of a taxpayer (the
CSC Group, the Vlasic Group, or any member thereof) for any taxable period.
Except as otherwise provided in this Agreement, a Tax Benefit shall be deemed to
have been realized or received from a Tax Item in a taxable period only if and
to the extent that the Tax Liability of the taxpayer for such period, after
taking into account the effect of the Tax Item on the Tax Liability of such
taxpayer in all prior periods, is less than it would have been if such Tax
Liability were determined without regard to such Tax Item.
TAX ITEM means any item of income, gain, loss, deduction, credit,
recapture of credit, or any other item which may have the effect of increasing
or decreasing Taxes paid or payable.
TAX LIABILITY means the net amount of Taxes due and paid or payable
for any taxable period, determined after applying all tax credits and all
applicable carrybacks or carryovers for net operating losses, net capital
losses, unused general business tax credits, or any other Tax Items arising from
a prior or subsequent taxable period, and all other relevant adjustments.
TAX RETURNS means all reports, estimates, declarations of estimated
tax, information statements and returns relating to, or required to be filed in
connection with any Taxes, including information returns or reports with respect
to backup withholding and other payments to third parties.
UNQUALIFIED TAX OPINION means an unqualified "will" opinion of tax
counsel to the effect that a transaction does not disqualify the Distribution or
any Other
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Transaction from qualifying for tax-free treatment for the shareowners of CSC
and any member of the CSC Group under Code Section 355 and any other applicable
sections of the Code, assuming that the Distribution or Other Transaction would
have qualified for tax free treatment if such transaction did not occur. An
Unqualified Tax Opinion may rely upon, and assume the accuracy of, any
representations contained in any application for letter ruling from the IRS,
and any representations contained in an officer's certificate delivered by an
officer of CSC or Vlasic to such counsel.
VLASIC GROUP means: (i) as of any relevant date after the Effective
Date, Vlasic and its Subsidiaries determined as of such date; and (ii) as of any
relevant date on or before the Effective Date, Vlasic and those Persons which
become Subsidiaries of Vlasic as a consequence of the Distribution, whether or
not such Persons were Subsidiaries of Vlasic before the Distribution.
VLASIC RETURNS has the meaning set forth in Section 2.2 hereof.
ARTICLE II
PREPARATION AND FILING OF TAX RETURNS
SECTION 2.1. CSC CONSOLIDATED RETURNS. CSC shall prepare and file, or
cause to be prepared and filed, all CSC Consolidated Returns.
SECTION 2.2. VLASIC RETURNS. Vlasic shall prepare and file, or cause
to be prepared and filed, all Tax Returns of or with respect to one or more
members of the Vlasic Group other than the CSC Consolidated Returns (the "Vlasic
Returns").
SECTION 2.3. TAXABLE PERIOD ENDS ON EFFECTIVE DATE. Unless prohibited
under applicable law, a taxable period of each member of the Vlasic Group that
is included in a CSC Consolidated Return which includes the Effective Date shall
end on the Effective Date.
SECTION 2.4. TAX-BASIS BALANCE SHEETS. In the case of any business
that was conducted prior to the Effective Date as a division of CSC and which
will be conducted after the Effective Date by a member of the Vlasic Group, CSC
shall prepare and furnish to Vlasic, within 120 days after the Effective Date, a
tax-basis Effective Date balance sheet relating to such business.
ARTICLE III
PAYMENT OF TAXES UPON FILING AND UPON SUBSEQUENT ADJUSTMENT
SECTION 3.1. TAXES GENERALLY. Except as provided in Section 3.2 and
Section 3.3 of this Agreement, CSC shall pay or cause to be paid and shall
indemnify and hold Vlasic and the members of the Vlasic Group harmless against
all Tax Liabilities that arise under each CSC Consolidated Return. Vlasic shall
pay or cause to be paid and shall indemnify and hold
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CSC and the members of the CSC Group harmless against all Tax Liabilities that
arise under each Vlasic Return.
SECTION 3.2. STRADDLE PERIODS. If, for purposes of a CSC Consolidated
Return, a taxable period of any member of the Vlasic Group includes the
Effective Date but does not end on the Effective Date (as otherwise generally
provided under Section 2.3 of this Agreement), CSC shall pay or cause to be paid
and shall indemnify and hold Vlasic and the members of the Vlasic Group harmless
against the Tax Liabilities attributable to the affected member or members of
the Vlasic Group for the portion of such tax period ending on the Effective Date
and Vlasic shall pay or cause to be paid and shall indemnify and hold CSC and
the members of the CSC Group harmless against the Tax Liabilities attributable
to the affected member or members of the Vlasic Group for the remainder of such
tax period beginning with the day after the Effective Date. The determination of
Tax Liabilities up to and following the Effective Date shall be based upon an
interim closing of the books of the affected member or members of the Vlasic
Group as of the opening of the Effective Date.
SECTION 3.3. ADJUSTMENTS. If any Tax Return is examined by a taxing
authority and an Adjustment results from such examination, the party bearing
responsibility for such Taxes determined under Section 3.1 shall pay its share
of any additional Tax Liability resulting from the Adjustment, provided,
however, that if the Adjustment which results in additional Tax Liability to one
party also results in a Tax Benefit to the other party, the party receiving such
Tax Benefit, to the extent it is equal to or less than the other party's
additional Tax Liability, shall pay such Tax Benefit to such other party within
30 days after such Tax Benefit is realized. Promptly after receiving notice from
the party having the Adjustment which results in additional Tax Liability, the
other party shall make a claim for any Tax Benefit resulting from such
Adjustment, on an amended Tax Return or in a formal or informal claim filed with
the IRS, unless the amount of such Tax Benefit is immaterial or unless otherwise
agreed by the parties. If an Adjustment could be governed by both this Section
3.3 and Articles VII, VIII, or IX, those Articles will take precedence over this
Section 3.3.
ARTICLE IV
COOPERATION AND EXCHANGE OF INFORMATION; AUDITS AND ADJUSTMENTS
SECTION 4.1. TAX RETURN INFORMATION.
(a) Vlasic shall, and shall cause each appropriate member of the
Vlasic Group to, provide CSC with all information and other assistance
reasonably requested by CSC to enable the members of the CSC Group to prepare
and file CSC Consolidated Returns required to be filed by them pursuant to this
Agreement.
(b) CSC shall, and shall cause each appropriate member of the CSC
Group to, provide Vlasic with all information and other assistance reasonably
requested by Vlasic to enable the members of the Vlasic Group to prepare and
file Vlasic Returns required to be filed by them pursuant to this Agreement.
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SECTION 4.2. AUDITS AND ADJUSTMENTS.
(a) Whenever CSC or Vlasic receives in writing from the IRS or any
other taxing authority notice of an Adjustment that may give rise to a payment
from the other party under this Agreement or otherwise affect the other party's
Taxes, CSC or Vlasic, as the case may be, shall give written notice of the
Adjustment to the other party within thirty (30) days of becoming aware of the
Adjustment but in no case later than ten (10) days before CSC or Vlasic, as the
case may be, is required to respond to the IRS or other taxing authority. The
party primarily liable for any Tax Liability with respect to the Adjustment
under Section 3.1 or Section 3.3 (the "Primary Party") at its own expense shall
have primary control over all matters relating to the Adjustment that may give
rise to a payment obligation by the Primary Party, provided, however, that the
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other party (the "Non-Primary Party") may settle, partially settle, or otherwise
resolve any controversy involving the Non-Primary Party's return to which the
particular Adjustment relates, so long as the Non-Primary Party does not settle,
partially settle, or otherwise resolve the controversy in a manner inconsistent
with the Primary Party's position, without prior written consent, which may not
be unreasonably withheld, from the Primary Party.
(b) Vlasic agrees reasonably to cooperate with CSC, in the
negotiation, settlement, or litigation of any liability for Taxes of any member
of the CSC Group.
(c) CSC agrees reasonably to cooperate with Vlasic in the
negotiation, settlement, or litigation of any liability for Taxes of any member
of the Vlasic Group.
(d) CSC will reasonably promptly notify Vlasic in writing of any
Adjustment involving a change in the tax basis of any asset of Vlasic,
specifying the nature of the change so that the Vlasic Group will be able to
reflect the revised basis in its tax books and records for periods beginning on
or after the Effective Date.
(e) In the event of a conflict between the operation of this Section
4.2 and Articles VII, VIII, or IX, those Articles will take precedence over this
Section 4.2.
For purposes of this Article IV, the term "party" shall refer to any member of
the CSC Group and any member of the Vlasic Group, as the case may be.
ARTICLE V
RETENTION OF RECORDS; STATUTES OF LIMITATIONS
SECTION 5.1. RETENTION OF RECORDS. CSC and Vlasic agree to retain the
appropriate records which may affect the determination of the liability for
Taxes of any member of the CSC Group or the Vlasic Group, respectively, until
such time as there has been a Final Determination with respect to such liability
for Taxes. A party may satisfy its obligations under the preceding sentence by
allowing the other party to duplicate records at such second party's request and
expense.
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SECTION 5.2. STATUTE OF LIMITATIONS. CSC and Vlasic will notify each
other in writing of any waivers or extensions of the applicable statute of
limitations that may affect the period for which any materials, records, or
documents must be retained.
ARTICLE VI
REPRESENTATIONS AND COVENANTS
SECTION 6.1. REPRESENTATIONS.
(a) Vlasic has reviewed the materials submitted to the IRS in
connection with the IRS Ruling and, to the best of Vlasic's knowledge, these
materials, including, without limitation, any statements and representations
concerning Vlasic, its business operations, capital structure and/or
organization, are complete and accurate in all material respects. Vlasic shall,
and shall cause each member of the Vlasic Group, to comply in all material
respects, and each member of the Vlasic Group shall comply in all material
respects, with each such representation and statement concerning Vlasic and the
Vlasic Group made in the materials so submitted and in the IRS Ruling, including
without limitation, statements relating to actions intended to achieve cost
savings to the Vlasic Group. With respect to any representation or statement
made by or on behalf of Vlasic or the Vlasic Group in connection with the IRS
Ruling and to the extent such representation or statement relates to future
actions or events under their control, neither Vlasic nor any member of the
Vlasic Group will take any action during the Restricted Period that would have
caused such representation or statement to be untrue if Vlasic or any member of
the Vlasic Group had planned or intended to take such action at the time such
representation or statement was made by or on behalf of Vlasic.
(b) Vlasic hereby represents and warrants to CSC that Vlasic has no
intention to undertake any of the transactions set forth in Section 6.2(a)(iii)
nor does Vlasic or any member of the Vlasic Group have any intention to cease to
engage in the active conduct of the trade or business (within the meaning of
Section 355(b)(2) of the Code) of the Retail Frozen Foods Business, the Beef
Products Business, the Fresh Mushrooms Business, the Pickle Business or the
Barbecue Sauce Business.
SECTION 6.2. COVENANTS.
(a) Vlasic and each member of the Vlasic Group covenant and agree
with CSC that during the Restricted Period:
(i) Vlasic and the members of the Vlasic Group will continue to
engage in the Retail Frozen Foods, Beef Products, Fresh
Mushrooms, Pickle and Barbecue Sauce Businesses and will
continue to maintain a substantial portion of their
respective assets and business operations as they existed
prior to the Distribution; provided that the foregoing
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shall not be deemed to prohibit Vlasic and the members of
the Vlasic Group from entering into or
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acquiring other businesses or operations or from disposing
of or shutting down segments of such Businesses so long as
Vlasic and the members of the Vlasic Group continue to
engage in such Businesses and continue to so maintain such
substantial portion of their assets and business
operations;
(ii) Vlasic will continue to manage and to own (A) directly
assets which represent at least 50% of the Gross Assets
which Vlasic managed and owned directly immediately after
the Distribution, and (B) directly or indirectly through
one or more entities, assets which represent at least 50%
of the Gross Assets which Vlasic owned indirectly through
one or more entities immediately after the Distribution;
(iii) Except as provided in Section 6.2(c), neither Vlasic, nor
any of its Affiliates nor any of its or their respective
directors, officers or other representatives will
undertake, authorize, approve, recommend, permit,
facilitate, or enter into any contract, or consummate any
transaction with respect to:
(1) the issuance of Vlasic common stock (including
options, warrants, rights or securities exercisable
for, or convertible into, Vlasic common stock) in a
single transaction or in a series of related or
unrelated transactions or otherwise or in the
aggregate which would exceed (or could exceed if any
such options, warrants or rights were exercised or
such securities were converted) 20% when expressed as
a percentage of the outstanding shares of Vlasic
common stock immediately following the Distribution;
(2) the issuance of any class or series of capital stock
or any other instrument (other than Vlasic common
stock and options, warrants, rights or securities
exercisable for, or convertible into, Vlasic common
stock) that would constitute equity for federal tax
purposes (such classes or series of capital stock and
other instruments being referred to herein as
"Disqualified Vlasic Stock");
(3) the issuance of any options, rights, warrants,
securities or similar arrangements exercisable for, or
convertible into, Disqualified Vlasic Stock;
(4) any redemptions, repurchases or other acquisitions of
capital stock or other equity interest in Vlasic in a
single
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transaction or a series of related or unrelated
transactions, unless such redemptions, repurchases or
other acquisition satisfy the following requirements
under Section 4.05(1)(b) of Revenue Procedure 96-30:
(A) there is a "sufficient business purpose" for the
transaction,
(B) the stock to be purchased, redeemed or otherwise
acquired is widely held,
(C) the stock purchases or other acquisitions will be
made on the open market, and
(D) the amount of stock purchases, redemptions, or
other acquisitions in a single transaction or in
a series of related or unrelated transactions
will not equal or exceed an amount of stock
representing 20% of the outstanding stock of
Vlasic immediately following the Distributions.
(5) the dissolution, merger, or complete or partial
liquidation of Vlasic or any announcement of such
action.
(iv) Vlasic will take the actions related to cost savings
detailed in materials submitted to the IRS in connection
with the IRS Ruling.
(b) In addition to the other representations, warranties, covenants
and agreements set forth in this Agreement, Vlasic and each member of the Vlasic
Group will take, or refrain from taking, as the case may be, such actions as CSC
may reasonably request during the Ruling Period as necessary to insure that the
Distributions and the Other Transactions qualify for the tax treatment stated in
the IRS Ruling, including, without limitation, such actions as CSC reasonably
determines may be necessary to preserve the IRS Ruling. Without limiting the
generality of the foregoing, Vlasic and the Vlasic Group shall cooperate with
CSC if CSC determines to obtain additional IRS rulings pertaining to whether any
actual or proposed change in facts and circumstances affects the tax status of
the Distributions or the Other Transactions.
(c) Following the Distribution Date, Vlasic and its Affiliates may
take any action or engage in conduct otherwise prohibited by Section 6.2 so long
as prior to such action or conduct, as the case may be, CSC or Vlasic receives
(A) a ruling from the IRS in form and substance reasonably satisfactory to CSC
and upon which CSC can rely to the effect that the proposed action or conduct,
as the case may be, will not cause the Distributions or the Other Transactions
to fail to qualify for the tax treatment stated in the IRS Ruling, or (B) an
Opinion of Counsel in form and substance reasonably satisfactory to CSC and upon
which CSC can rely to
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the effect that the proposed action or conduct, as the case may be, will not
cause the Distributions or the Other Transactions to fail to qualify for the tax
treatment stated in the IRS Ruling.
ARTICLE VII
VLASIC INDEMNITY OBLIGATIONS
SECTION 7.1. VLASIC INDEMNITY. If Vlasic, or another member (or
former member) of the Vlasic Group (collectively, jointly and severally, the
"Indemnifying Parties") takes any action prohibited by Article VI or violates a
representation or covenant contained in Article VI, and the Distribution or any
of the Other Transactions fails to qualify for the tax treatment stated in the
IRS Ruling primarily as a result of such action or violation, then the
Indemnifying Parties shall (jointly and severally) indemnify and hold harmless
CSC and each member of the CSC Group (collectively the "Indemnified Party")
against any and all Taxes imposed upon or incurred by the Indemnified Party as a
result of the failure, including, without limitation, any liability of the
Indemnified Party arising from Taxes imposed on shareowners of CSC to the extent
any shareowner or shareowners of CSC or the IRS or other taxing authority
successfully seek recourse against the Indemnified Party on account of any such
failure, or any liability for such Taxes which the Indemnified Party may assume
or otherwise incur.
SECTION 7.2. TENDER OFFER OR PURCHASE OFFER. Notwithstanding anything
to the contrary set forth in this Agreement, if, during the Restricted Period,
any Person or Group of Affiliated Persons or Associates acquires Beneficial
Ownership of Vlasic common stock (or any other class of outstanding Vlasic
stock) or commences a tender or other purchase offer for the capital stock of
Vlasic or initiates any other form of transaction to acquire directly or
indirectly Vlasic capital stock, upon consummation of which such Person or Group
of Affiliated Persons or Associates would acquire Beneficial Ownership of Vlasic
common stock (or any other class of outstanding Vlasic stock) such that the
Distribution or any of the Other Transactions shall fail to qualify for the tax
treatment stated in the IRS Ruling primarily as a result of such acquisition,
tender or other purchase offer, or other form of transaction, then the
Indemnifying Parties shall indemnify and hold harmless the Indemnified Party
against any and all Taxes imposed upon or incurred by the Indemnified Party
and/or its shareowners as a result of the failure of the Distribution or the
Other Transactions to so qualify.
SECTION 7.3. EFFECT OF SUPPLEMENTAL RULING OR OPINION OF COUNSEL. The
Indemnified Party shall be indemnified and held harmless under Section 7.1
without regard to the fact that the Indemnified Party may have received a
supplemental ruling from the IRS or an Opinion of Counsel as contemplated by
Section 6.2(c). The Indemnified Party shall be indemnified and held harmless
under Section 7.2 without regard to whether an acquisition of Beneficial
Ownership results from a transaction which is not prohibited under Article VI.
ARTICLE VIII
CALCULATION OF VLASIC INDEMNITY AMOUNTS
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SECTION 8.1. AMOUNT OF INDEMNITY. The amount indemnified against
under Article VII ("Indemnified Liability") for a tax based on or determined
with reference to income shall be deemed to be the amount of the tax computed by
multiplying (i) the taxing jurisdiction's highest marginal tax rate applicable
to taxable income of corporations such as the Indemnified Party on income of the
character subject to tax and indemnified against under Article VII for the
taxable period in which the Distribution occurs, times (ii) the gain or income
of the Indemnified Party which is subject to tax in the taxing jurisdiction and
indemnified against under Article VII. In the case of an Indemnified Liability
attributable to a payment owed to a shareowner or shareowners of CSC, the amount
of the Indemnified Liability shall be equal to the amount so owed, including
without limitation, interest, costs, additions, expenses and penalties. All
amounts payable under this Agreement shall be grossed-up, based on the tax rate
referred to in clause (i) of the preceding sentence, so that the Indemnified
Party is made whole on an after-tax basis.
ARTICLE IX
PROCEDURAL ASPECTS OF VLASIC INDEMNITY
SECTION 9.1. GENERAL.
(a) If either the Indemnified Party or any of the Indemnifying
Parties receives any written notice of deficiency, claim or adjustment or any
other written communication from a taxing authority that may result in an
Indemnified Liability, the party receiving such notice or communication shall
promptly give written notice thereof to the other party, provided that any delay
by the Indemnified Party in so notifying an Indemnifying Party shall not relieve
the Indemnifying Party of any liability hereunder, except to the extent (i) such
delay restricts the ability of the Indemnifying Party to contest the resulting
Indemnified Liability administratively or in the courts in accordance with
Section 9.2 and (ii) the Indemnifying Party is materially and adversely
prejudiced by such delay.
(b) The parties hereto undertake and agree that from and after such
time as they obtain knowledge that any representative of a taxing authority has
begun to investigate or inquire into the Distribution or any of the Other
Transactions (whether or not such investigation or inquiry is a formal or
informal investigation or inquiry), the party obtaining such knowledge shall (i)
notify the other party thereof, provided that any delay by the Indemnified Party
in so notifying the Indemnifying Party shall not relieve the Indemnifying Party
of any liability hereunder (except to the extent (A) such delay restricts the
ability of the Indemnifying Party to contest the resulting Indemnified Liability
administratively or in the courts in accordance with Section 9.2 and (B) the
Indemnifying Party is materially and adversely prejudiced by such delay), (ii)
consult with the other party from time to time as to the conduct of such
investigation or inquiry, (iii) provide the other party with copies of all
correspondence with such taxing authority or any representative thereof
pertaining to such investigation or inquiry, and (iv) arrange for a
representative of the other party to be present at all meetings with such taxing
authority or any representative thereof pertaining to such investigation or
inquiry.
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(c) Vlasic undertakes and agrees to give to CSC attestations and/or
access to information, as requested by CSC, to document and verify the
achievement of the cost savings detailed in materials submitted to the IRS in
connection with the IRS Ruling.
SECTION 9.2. CONTESTS.
(a) Provided that (i) an Indemnifying Party shall furnish the
Indemnified Party with evidence reasonably satisfactory to the Indemnified Party
of its ability to pay the full amount of the Indemnified Liability and (ii) such
Indemnifying Party acknowledges in writing that the asserted liability is an
Indemnified Liability, such Indemnifying Party shall assume and direct the
defense or settlement of any tax examination, administrative appeal, hearing,
arbitration, suit or other proceeding (each a "Proceeding") commenced, filed or
otherwise initiated or convened to investigate or resolve the existence and
extent of such liability.
(b) If the Indemnified Liability is grouped with other unrelated
asserted liabilities or issues in the Proceeding, the parties shall use their
respective best efforts to cause the Indemnified Liability to be the subject of
a separate proceeding. If such severance is not possible, the Indemnifying Party
shall assume and direct and be responsible only for the matters relating to the
Indemnified Liability.
(c) Notwithstanding the foregoing, if at any time during a Proceeding
controlled by an Indemnifying Party pursuant to Section 9.2(a) such Indemnifying
Party fails to provide evidence reasonably satisfactory to the Indemnified Party
of its ability to pay the full amount of the Indemnified Liability or the
Indemnified Party reasonably determines, after due investigation, that such
Indemnifying Party could not pay the full amount of the Indemnified Liability,
then the Indemnified Party may assume control of the Proceedings upon 7 days
written notice.
(d) In addition to the amounts referred to in Section 7.1, an
Indemnifying Party shall pay all out-of-pocket expenses and other costs related
to the Indemnified Liability, including but not limited to fees for attorneys,
accountants, expert witnesses or other consultants retained by such Indemnifying
Party and/or the Indemnified Party. To the extent that any such expenses and
other costs have been or are paid by an Indemnified Party, the Indemnifying
Party shall promptly reimburse the Indemnified Party therefor.
(e) An Indemnifying Party shall not pay (unless otherwise required by
a proper notice of levy and after prompt notification to the Indemnified Party
of receipt of notice and demand for payment), settle, compromise or concede any
portion of the Indemnified Liability without the written consent of the
Indemnified Party, which consent shall not be unreasonably withheld. An
Indemnifying Party shall, on a timely basis, keep the Indemnified Party informed
of all developments in the Proceeding and provide the Indemnified Party with
copies of all pleadings, briefs, orders, and other written papers.
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(f) Any Proceeding which is not controlled or which is no longer
controlled by an Indemnifying Party pursuant to Section 9.2 shall be controlled
and directed exclusively by the Indemnified Party, and any related out-of-pocket
expenses and other costs incurred by the Indemnified Party, including but not
limited to, fees for attorneys, accountants, expert witnesses or other
consultants, shall be reimbursed by such Indemnifying Party. An Indemnified
Party will not be required to pursue the claim in federal district court, the
Court of Federal Claims or any state or foreign court if as a prerequisite to
such court's jurisdiction, the Indemnified Party is required to pay the asserted
liability unless the funds necessary to invoke such jurisdiction are provided by
such Indemnifying Party.
SECTION 9.3. TIME AND MANNER OF PAYMENT. An Indemnifying Party shall
pay to the Indemnified Party the amount of the Indemnified Liability and any
expenses or other costs indemnified against (less any amount paid directly by an
Indemnifying Party to the taxing authority) no less than seven (7) business days
prior to the date payment of the Indemnified Liability is to be made by any
party to the taxing authority (or, if applicable, to one or more CSC
shareowners). Such payment shall be paid by wire transfer of immediately
available funds to an account designated by the Indemnified Party by written
notice to an Indemnifying Party prior to the due date of such payment. If an
Indemnifying Party delays making payment beyond the due date hereunder, such
party shall pay interest on the amount unpaid at the IRS Interest Rate for each
day and the actual number of days for which any amount due hereunder is unpaid.
SECTION 9.4. REFUNDS. In connection with this Agreement, if an
Indemnified Party receives a refund in respect of amounts paid by an
Indemnifying Party to any taxing authority on its behalf, or should any such
amounts that would otherwise be refundable to the Indemnifying Party be applied
by the taxing authority to obligations of the Indemnified Party unrelated to an
Indemnified Liability, then such Indemnified Party shall, promptly following
receipt (or notification of credit), remit such refund and any related interest
to such Indemnifying Party.
SECTION 9.5. COOPERATION. The parties shall cooperate with one
another in a timely manner in any administrative or judicial proceeding
involving any matter that may result in an Indemnified Liability.
ARTICLE X
RESOLUTION OF DISPUTES
SECTION 10.1 DISPUTES.
(a) Resolution of any and all disputes arising from or in connection
with this Agreement, whether based on contract, tort, statute or otherwise,
including, but not limited to, disputes in connection with claims by third
parties (collectively, "Disputes"), shall be subject to the provisions of this
Section 10.1; provided, however, that nothing contained herein shall preclude
either party from
15
seeking or obtaining (i) injunctive relief or (ii) equitable or other judicial
relief to enforce the provisions hereof or to preserve the status quo pending
resolution of Disputes hereunder.
(b) Either party may give the other party written notice of any
Dispute not resolved in the normal course of business. The parties shall attempt
in good faith to resolve any Dispute promptly by negotiation between executives
of the parties who have authority to settle the controversy and who are at a
higher level of management than the persons with direct responsibility for
administration of this Agreement. Within 30 days after delivery of the notice,
the foregoing executives of both parties shall meet at a mutually acceptable
time and place, and thereafter as often as they reasonably deem necessary for a
period not to exceed 15 days, to attempt to resolve the Dispute. All reasonable
requests for information made by one party to the other will be honored. If the
parties do not resolve the Dispute within such 45 day period (the "Initial
Mediation Period"), the parties shall attempt in good faith to resolve the
Dispute by negotiation between (a) in the case of CSC, the Chief Executive
Officer, and (b) in the case of Vlasic, the Chief Executive Officer
(collectively, the "Designated Officers"). Such officers shall meet at a
mutually acceptable time and place (but in any event no later than 15 days
following the expiration of the Initial Mediation Period) and thereafter as
often as they reasonably deem necessary for a period not to exceed 15 days, to
attempt to resolve the Dispute.
(c) If the Dispute has not been resolved by negotiation within 75
days of the first party's notice, or if the parties failed to meet within 30
days of the first party's notice, or if the Designated Officers failed to meet
within 60 days of the first party's notice, either party may commence any
litigation or other procedure allowed by law.
ARTICLE XI
GENERAL
SECTION 11.1. TERM OF THE AGREEMENT. This Agreement shall become
effective as of the Effective Date and, except as otherwise expressly provided
herein, shall continue in full force and effect indefinitely.
SECTION 11.2. ELECTIONS UNDER CODE SECTION 1552. Nothing in this
Agreement is intended to change or otherwise affect any election made by or on
behalf of the CSC Group with respect to the calculation of earnings and profits
under Code Section 1552.
SECTION 11.3. INJUNCTIONS. The parties acknowledge that irreparable
damage would occur in the event that any of the provisions of this Agreement
were not performed in accordance with its specific terms or were otherwise
breached. The parties hereto shall be entitled to an injunction or injunctions
to prevent breaches of the provisions of this Agreement and to enforce
specifically the terms and provisions hereof in any court having jurisdiction,
such remedy being in addition to any other remedy to which they may be entitled
at law or in equity.
16
SECTION 11.4. ASSIGNMENT. Neither of the parties may assign or
delegate any of its rights or duties under this Agreement without the prior
written consent of the other party, which consent will not be unreasonably
withheld. This Agreement shall be binding upon, and shall inure to the benefit
of, the parties hereto and their respective successors and permitted assigns.
SECTION 11.5. FURTHER ASSURANCES. Subject to the provisions hereof,
the parties hereto shall make, execute, acknowledge, and deliver such other
instruments and documents, and take all such other actions, as may be reasonably
required in order to effectuate the purposes of this Agreement and to consummate
the transactions contemplated hereby. Subject to the provisions hereof, each of
the parties shall, in connection with entering into this Agreement, performing
its obligations hereunder and taking any and all actions relating hereto, comply
with all applicable laws, regulations, orders, and decrees, and promptly provide
the other parties with all such information as they may reasonably request in
order to be able to comply with the provisions of this sentence.
SECTION 11.6. WAIVERS. No failure or delay on the part of the parties
in exercising any power or right hereunder shall operate as a waiver thereof,
nor shall any single or partial exercise of any such right or power, or any
abandonment or discontinuance of steps to enforce such right or power, preclude
any other or further exercise thereof or the exercise of any other right or
power. No modification or waiver of any provision of this Agreement nor consent
to any departure by the parties therefrom shall in any event be effective unless
the same shall be in writing, and then such waiver or consent shall be effective
only in the specific instance and for the purpose for which given.
SECTION 11.7. CHANGE OF LAW. If, due to any change in applicable law
or regulations or their interpretation by any court of law or other governing
body having jurisdiction subsequent to the date of this Agreement, performance
of any provision of this Agreement or any transaction contemplated thereby shall
become impracticable or impossible, the parties hereto shall use their best
efforts to find and employ an alternative means to achieve the same or
substantially the same result as that contemplated by such provision.
SECTION 11.8. CONFIDENTIALITY. Subject to any contrary requirement of
law and the right of each party to enforce its rights hereunder in any legal
action, each party agrees that it shall keep strictly confidential, and shall
cause its employees and agents to keep strictly confidential, any information
which it or any of its employees or agents may require pursuant to, or in the
course of performing its obligations under, any provision of this Agreement.
SECTION 11.9. HEADINGS. Descriptive headings are for convenience only
and shall not control or affect the meaning or construction of any provision of
this Agreement.
SECTION 11.10. COUNTERPARTS. For the convenience of the parties, any
number of counterparts of this Agreement may be executed by the parties hereto,
and each such executed counterpart shall be, and shall be deemed to be, an
original instrument.
17
SECTION 11.11. NOTICES. All notices, requests, claims and other
communications hereunder shall be in writing and shall be given or made (and
shall be deemed to have been duly given or made upon receipt) by delivery by
hand, by reputable overnight courier service, by facsimile transmission, or by
registered or certified mail (postage prepaid, return receipt requested) to the
respective parties at the addresses (or at such other address for a party as
shall be specified in a notice given in accordance with this Section 11.11
listed below:
CSC at: Campbell Soup Company
Campbell Place
Camden, New Jersey 08101
Attn.: Vice President-Taxes
Fax No. (609) 342-6033
Vlasic at: Vlasic Foods International Inc.
Campbell Place
Camden, New Jersey
Attn.: Norma B. Carter, Esq.
Fax No. (609) 342-3936
or to such other address as any party may, from time to time, designate in a
written notice given in a like manner. Notice given by hand shall be deemed
delivered when received by the recipient. Notice given by mail as set out above
shall be deemed delivered five (5) calendar days after the date the same is
mailed. Notice given by reputable overnight courier shall be deemed delivered
on the next following business day after the same is sent. Notice given by
facsimile transmission shall be deemed delivered on the day of transmission
provided telephone confirmation of receipt is obtained promptly after completion
of transmission.
SECTION 11.12. PRE-DISTRIBUTION EARNINGS AND PROFITS. CSC and Vlasic
agree to allocate pre-Distribution earnings and profits in accordance with
Treasury Regulation Section 1.312-10.
SECTION 11.13. COSTS AND EXPENSES. Unless otherwise specifically
provided herein, each party agrees to pay its own costs and expenses resulting
from the fulfillment of its respective obligations hereunder.
SECTION 11.14. CANCELLATION OF PRIOR TAX ALLOCATION OR TAX-SHARING
AGREEMENTS. Except as otherwise expressly provided herein, on or prior to the
Effective Date, CSC shall cancel or cause to be canceled all agreements (other
than this Agreement) providing for the allocation or sharing of Taxes to which
any member of the Vlasic Group would otherwise be bound following the
Distribution.
SECTION 11.15. INTEREST ON LATE PAYMENTS. If a party delays making
any payment beyond the due date hereunder, such party shall pay interest on the
amount unpaid at the
18
IRS Interest Rate for each day and the actual number of days for which any
amount due hereunder is unpaid.
SECTION 11.16. GENERAL. This Agreement, including the attachments,
shall constitute the entire agreement between the parties hereto with respect to
the subject matter hereof and shall supersede all prior agreements and
undertakings, both written and oral, between the parties with respect to the
subject matter hereof and thereof. This Agreement may not be amended or modified
except (a) by an instrument in writing signed by, or on behalf of, the parties
or (b) by a waiver in accordance with Section 11.6. This Agreement shall be
binding upon and inure solely to the benefit of the parties hereto and their
respective present and future subsidiaries, and nothing herein, express or
implied, is intended to or shall confer upon any third parties any legal or
equitable right, benefit or remedy of any nature whatsoever under or by reason
of this Agreement.
SECTION 11.17. GOVERNING LAW AND SEVERABILITY. This Agreement shall
be governed by, and construed in accordance with, the laws of the State of New
Jersey, applicable to contracts executed in and to be performed entirely within
that state. If any term or other provision of this Agreement is invalid, illegal
or incapable of being enforced by any law or public policy, all other terms and
provisions of this Agreement shall nevertheless remain in full force and effect
so long as the economic or legal substance of the transactions contemplated
hereby is not affected in any manner materially adverse to any party. Upon such
determination that any term or other provision is invalid, illegal or incapable
of being enforced, the parties hereto shall negotiate in good faith to modify
this Agreement so as to effect the original intent of the parties as closely as
possible in an acceptable manner in order that the transactions contemplated
hereby are consummated as originally contemplated to the greatest extent
possible.
IN WITNESS WHEREOF, the undersigned have caused this Agreement to be
duly executed by their respective officers, each of whom is duly authorized, all
as of the Effective Date.
CAMPBELL SOUP COMPANY
By: ___________________________________
Name:
Title:
VLASIC FOODS INTERNATIONAL INC.
By: ___________________________________
Name:
Title:
19
ALIGAR, INC.
By: __________________________________
Name:
Title:
CAMPBELL'S FRESH, INC.
By: __________________________________
Name:
Title:
CARGAL, INC.
By: __________________________________
Name:
Title:
VLASIC FOODS, INC.
By: __________________________________
Name:
Title:
VLASIC FOODS SALES COMPANY
By: __________________________________
Name:
Title:
VLASIC INTERNATIONAL BRANDS INC.
By: __________________________________
Name:
Title:
20
CAMPBELL FROZEN FOODS LIMITED
By: __________________________________
Name:
Title:
[U.K. NEWCO (A UNITED KINGDOM
CORPORATION TO BE FORMED)]
By: __________________________________
Name:
Title:
[CANADA NEWCO (A CANADIAN
CORPORATION TO BE FORMED)]
By: __________________________________
Name:
Title:
SWIFT-ARMOUR S.A. ARGENTINA
By: __________________________________
Name:
Title:
SKANDIAVEIN-UND SUD-IMPORT GMBH
By: __________________________________
Name:
Title:
21
CAMPBELL GROCERY PRODUCTS GMBH
By: __________________________________
Name:
Title:
22
Dates Referenced Herein and Documents Incorporated by Reference
| Referenced-On Page |
|---|
| This ‘10-12B’ Filing | | Date | | First | | Last | | | Other Filings |
|---|
| |  |
| Filed on: | | 3/5/98 | | | | | | | 3 |
| | 7/25/97 | | 5 |
| List all Filings |
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