EXHIBIT 2.1
DATED 23 October 2007
UMBRO PLC
NIKE VAPOR LTD.
and
NIKE, INC.
IMPLEMENTATION AGREEMENT
▇▇▇▇▇ & ▇▇▇▇▇▇▇▇ LLP
London
Ref: TAS/REA/STC
CONTENTS
Clause Page
1. Definitions and Interpretation 1
2. Implementation of the acquisition 8
3. Obligations of Nike Vapor and Umbro 10
4. Publication of the Acquisition Document 14
5. Recommendation 15
6. Competing Proposals 16
7. Conduct of Business Pending Completion of the Acquisition 17
8. Employee Compensation and Benefits 19
9. Inducement Fee 21
10. Termination 22
11. Confirmations 23
12. Announcement 23
13. Further Announcements 23
14. Confidentiality 24
15. Counterparts 24
16. Variation, Waiver and Consent 24
17. Rights and remedies cumulative 24
18. Entire Agreement 24
19. Notices 25
20. Severability 26
21. Costs 26
22. Contracts (Rights of Third Parties) ▇▇▇ ▇▇▇▇ 26
23. Time of the Essence 27
24. Assignment 27
25. Disputes 27
Schedule
SCHEDULE 1
Form of Press Announcement 28
SCHEDULE 2
Indicative Timetable 29
SCHEDULE 3
Form of General Meeting Resolutions 30
SCHEDULE 4
The Resolutions 33
APPENDIX 1
Amounts to be Paid Out under the Umbro Long Term
Incentive Plan 2004 34
THIS IMPLEMENTATION AGREEMENT is made on 23 October 2007
BETWEEN:
(1) UMBRO PLC, company incorporated in England and Wales with registered
number 3674789, whose registered office is at ▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇ (?Umbro?);
(2) NIKE VAPOR LTD, company incorporated in England and Wales with
registered number 6403083, whose registered office is at ▇ ▇▇▇▇▇▇▇
▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇ & ▇▇▇▇,
▇▇▇ ▇▇▇ (?Nike Vapor?); and
(3) NIKE, INC., an Oregon corporation, whose address of principal
executive offices is at ▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇-
6453 (?Nike?).
RECITALS:
(A) Nike Vapor proposes to announce a firm intention to make a
recommended cash offer for the entire issued and to be issued share
capital of Umbro pursuant to Rule 2.5 of the Takeover Code.
(B) Nike Vapor, a wholly-owned subsidiary of Nike, was formed for the
purpose of effecting the Acquisition, which will be implemented by
means of a scheme of arrangement under section 425 of the Companies
▇▇▇ ▇▇▇▇ to be proposed by Umbro to its shareholders.
(C) Nike Vapor reserves the right, as set out in this Agreement and the
Press Announcement, to elect to implement the Acquisition by way of a
Takeover Offer (as such term is defined in section 974 of the
Companies Act 2006) for the entire issued and to be issued share
capital of Umbro (the ?Takeover Offer?) rather than by way of a
scheme of arrangement under section 425 of the Companies ▇▇▇ ▇▇▇▇.
(D) The Acquisition will be made on or substantially on the terms and
subject to the conditions (i) set out in the Press Announcement and
in this Agreement; and (ii) to be set out in the Scheme Circular (or,
if relevant, the Offer Document).
(E) The parties wish to enter into this Agreement to set out certain
mutual commitments to implement the Acquisition (including the Scheme
and, if relevant, the Takeover Offer) and certain matters relating to
the conduct of the Umbro Group business pending the Acquisition
Effective Date.
IT IS AGREED as follows:
1. DEFINITIONS AND INTERPRETATION
1.1 Defined Terms
In this agreement, the following words and expressions shall have the
following meaning (including in the introductory provisions):
?Acquisition? means the proposed acquisition by Nike of
the entire issued and to be issued ordinary
share capital of Umbro substantially on the
terms and conditions set out in the Press
Announcement or, should Nike so elect in
accordance with Clause 3.5 of this
Agreement, by way of a Takeover Offer;
?Acquisition Document? means (i) if the Scheme is (or is to be)
implemented, the Scheme Circular; or (ii) if
the Takeover Offer is (or is to be)
implemented, the Offer Document;
?Acquisition Effective Date? means the date upon which (i) the Scheme
becomes effective in accordance with its
terms; or (ii) if Nike Vapor elects to
implement the Acquisition by way of a
Takeover Offer, the date that the Takeover
Offer becomes or is declared unconditional
in all respects;
?Anti-trust Authority? means any anti-trust or competition
Regulatory Authority;
?Anti-trust Clearances? means any Clearances required by any Anti-
trust Authority;
?Board? means the board of directors of Umbro from
time to time;
?Business Day? means any day, other than a Saturday or
Sunday or a public holiday in the UK;
?Clearances? means all authorisations, orders,
recognitions, grants, consents, licenses,
confirmations, certificates, clearances,
permissions and approvals as are deemed by
Nike Vapor to be necessary or appropriate,
and all findings and waiting periods as are
necessary or appropriate, from or under the
laws, regulations or practices applied by
any Relevant Authority in connection with
the implementation of, in each case to the
extent relevant, the Acquisition, the Scheme
or the Takeover Offer (including, but not
limited to the Conditions), and references
to ?Clearances? and ?being satisfied? shall
be construed as meaning that the foregoing
have been obtained on terms and in a form
reasonably satisfactory to Nike Vapor or,
where appropriate, waived or expired;
?Companies Act 1985? means the Companies ▇▇▇ ▇▇▇▇ (as amended);
?Companies Act 2006? means the Companies ▇▇▇ ▇▇▇▇ (as amended);
?Competing Proposal? means (i) any bona fide proposal by a third
party which is not acting in concert (as
defined in the Takeover Code) with Nike
Vapor to announce or implement an offer,
scheme of arrangement, merger or business
combination, or similar transaction, the
purpose of which is to enable that third
party (or any other person not being Nike
Vapor or any member of its Group and/or any
person acting in concert with Nike Vapor) to
acquire a majority of the entire issued and
to be issued share capital of Umbro, or as
the case may be any announcement thereof; or
(ii) any transaction that constitutes a
Class 1 disposal for Umbro for the purposes
of the Listing Rules, and, for these
purposes, ?proposed? shall include an
approach with a view to making a proposal
with regard to the same;
?Completion? means the completion of the Acquisition upon
the registration of the Court Orders or, if
Nike elects to effect the Acquisition by way
of a Takeover Offer, upon the Takeover Offer
becoming unconditional in all respects;
?Conditions? means (i) if the Acquisition is being
implemented by the Scheme, the conditions
comprising the Scheme Conditions; or (ii) if
the Acquisition is being implemented by way
of the Takeover Offer, the conditions
comprising the Takeover Offer Conditions;
?Court? means the High Court of Justice in England
and Wales;
?Court Hearings? means the hearings by the Court of the
application (i) to sanction the Scheme; and
(ii) to confirm the Umbro Capital Reduction
(and to grant the Court Order);
?Court Meeting? means the meeting of holders of Scheme
Shares (and any adjournment thereof) to be
convened by order of the Court pursuant to
section 425 of the Companies ▇▇▇ ▇▇▇▇ to
consider and vote on the Scheme (with or
without amendment) and, if required, any
meeting held as a result of an adjournment
by Umbro or a reconvening by the Court
thereof in accordance with this Agreement;
?Court Orders? means the orders of the Court sanctioning
the Scheme under section 425 of the
Companies ▇▇▇ ▇▇▇▇ and confirming the Umbro
Capital Reduction under section 137 of the
Companies ▇▇▇ ▇▇▇▇, and ?Court Order? means
either one of them;
?Day 60? means the final date set by the Panel, in
accordance with the Takeover Code as ?Day
60? in connection with the Acquisition to
the extent it is implemented by way of a
Takeover Offer;
?Day 81? means the final date set by the Panel, in
accordance with the Takeover Code as ?Day
81? in connection with the Acquisition to
the extent it is implemented by way of a
Takeover Offer;
?Directors? means the directors of Umbro from time-to-
time;
?Exchange Act? means the United States Securities Exchange
Act of 1934 (as amended) and the rules and
regulations promulgated thereunder;
?Excluded Shares? means any Umbro Shares beneficially owed by
any member of the Nike Group or any Umbro
Shares held in treasury by Umbro;
?First Court Hearing Date? means the date of the hearing by the Court
to sanction the Scheme;
?FSMA? means the Financial Services and Markets ▇▇▇
▇▇▇▇ (as amended);
?General Meeting? means the extraordinary general meeting of
Umbro shareholders (including any
adjournment thereof) to be convened to
consider and, if thought fit, to approve
certain resolutions as set out in Schedule 3
in relation to the Scheme and, if relevant,
the Acquisition (with or without
amendments);
?Group? means, in relation to any person, that
person and any companies which are holding
companies, subsidiaries or subsidiary
undertakings of it or of any such holding
company;
?Inducement Fee? has the meaning given in clause 9;
?Listing Rules? means the rules and regulations made by the
Financial Services Authority in its capacity
as the UK Listing Authority under the FSMA,
and contained in the UK Listing Authority?s
publication of the same name, as amended
from time to time;
?Meetings? means the Court Meeting and the General
Meeting;
?Offer Document? means, if following the date of this
Agreement Nike Vapor elects to implement the
Acquisition by way of a Takeover Offer in
accordance with clause 3.5, the document to
be posted to Umbro Shareholders and others
pursuant to which the Takeover Offer is made
by Nike Vapor (or such other entity as it
may elect) containing, amongst other things,
the Takeover Offer Conditions and certain
information about Nike Vapor and Umbro and,
where the context so permits, including any
form of acceptance, election, notice or
other document required in connection with
the Takeover Offer;
?Official List? means the official list of the UK Listing
Authority;
?Panel? means the Panel on Takeovers and Mergers;
?Part VI Rules? means any of the Listing Rules, Disclosure
Rules and Transparency Rules or Prospectus
Rules made by the UK Financial Services
Authority in exercise of its functions as
competent authority pursuant to Part VI of
FSMA;
?Press Announcement? means the draft press announcement set out
in Schedule 1;
?Registrar? means the Registrar of Companies for England
and Wales;
?Relevant Authority? means any central bank, ministry,
governmental, quasi-governmental (including
the European Union), supranational,
statutory, regulatory, administrative or
investigative body or authority (including
any national or supranational antitrust,
competition or merger control authority or
similar authority), national, state,
municipal or local government (including any
subdivision, court, administrative agency or
commission or other authority thereof),
government department, private body
exercising any regulatory, taxing, importing
or other authority, court, agency (including
trade agency), association, institution or
professional or environmental body or
(without prejudice to the generality of the
foregoing) any other person or body
whatsoever in any jurisdiction;
?Remuneration Committee? means the duly constituted remuneration
committee of the Board;
?Representatives? means in relation to a party, the directors,
officers, employees and consultants of, and
individuals seconded to work for it or other
companies within its Group;
?Resolutions? means the resolutions of the Remuneration
Committee set out in Schedule 4;
?Retention Plan? shall have the meaning given to that term in
clause 8.5;
?Scheme? means the scheme of arrangement proposed to
be made under section 425 of the Companies
▇▇▇ ▇▇▇▇ between Umbro and the holders of
the Scheme Shares in connection with the
Acquisition with or subject to any
modification, addition or condition approved
or imposed by the Court and agreed to by
Umbro and Nike Vapor;
?Scheme Circular? means, if the Acquisition is implemented by
way of the Scheme, the document to be
dispatched to Umbro Shareholders and others
by Umbro containing, amongst other things,
the Scheme Conditions and other relevant
terms and conditions, a description of the
Scheme, certain information about Nike Vapor
and Umbro and the notices of the Meetings
and, where the context so permits, includes
any form of proxy, election, notice, court
document, meeting advertisement or other
document required in connection with the
Scheme;
?Scheme Conditions? means the conditions to the implementation
of the Acquisition (including the Scheme) as
set out in Appendix I of the Press
Announcement (subject to any changes agreed
between the parties) which shall, pursuant
to clause 4.1(a), be incorporated into the
Scheme Circular;
?Scheme Shareholders? means the holders of the Scheme Shares;
?Scheme Shares? shall have the meaning given to that term in
the Press Announcement;
?Scheme Voting Record Time? means 6.00 p.m. on the day which is two days
before the date of the Court Meeting or, if
such Court Meeting is adjourned, 6.00 p.m.
on the second day before the day of such
adjourned meeting;
?Second Court Hearing Date? means the date of the hearing by the Court
to confirm the Umbro Capital Reduction;
?Superior Proposal? means a bona fide Competing Proposal which
the Directors consider, acting in good faith
and after consultation with their legal and
financial advisers, is able to be announced
pursuant to its terms taking into account
all financial, regulatory and other aspects
of the proposal (including the ability of
the proposing party to consummate the
transactions contemplated by such proposal)
and which, if consummated, would be superior
to the Acquisition to Umbro Shareholders,
and which the Directors are, therefore,
minded to recommend;
?Takeover Code? means the City Code on Takeovers and Mergers
as amended and enforced from time-to-time;
?Takeover Offer? has the meaning given to it in Recital (C);
?Takeover Offer Conditions? means the Scheme Conditions subject to the
deletion of the Conditions set out in
paragraphs 1 and 2 of Appendix I of the
Press Announcement and their replacement
with the condition that the Takeover Offer
be subject to an acceptance condition set at
90 per cent. (or such lesser percentage,
being more than 50 per cent., as Nike Vapor
may decide) of: (i) the shares to which such
offer relates; and (ii) the voting rights
normally exercisable at a general meeting of
Umbro, including, for this purpose, any such
voting rights attaching to Umbro Shares that
are unconditionally allotted or issued
before the Takeover Offer becomes or is
declared unconditional as to acceptances,
whether pursuant to the exercise of any
outstanding subscription or conversion
rights or otherwise;
?Target Hearing Time? has the meaning in clause 2.1;
?Timetable? means (i) in relation to the implementation
of the Acquisition by way of the Scheme, the
indicative timetable for the Acquisition set
out in Schedule 2; and (ii) in relation to
the implementation of the Acquisition by way
of the Takeover Offer, such indicative
timetable (which complies with the
requirements of the Takeover Code) as may be
notified in writing by Nike Vapor to Umbro
as soon as reasonably practical following
Nike Vapor making a valid election in
accordance with clause 3.5;
?UK Listing Authority? means the UK Financial Services Authority
acting in its capacity as the competent
authority for listing in the United Kingdom
for the purposes of Part VI of FSMA;
?Umbro Capital Reduction? means the reduction of share capital of
Umbro associated with the cancellation and
extinguishing of the Umbro Shares provided
for by the Scheme under section 135 of the
Companies ▇▇▇ ▇▇▇▇;
?Umbro Executive Bonus Scheme? means any scheme, policy, arrangement,
custom, practice or contractual provision,
other than the Retention Plan, pursuant to
which any employee of any member of the
Umbro Group has been or may be paid a bonus
payment of any kind;
?Umbro Group? means the wider Umbro group including the
subsidiary undertakings and associated
undertakings of Umbro and any other body
corporate, partnership, joint venture or
person in which Umbro and such undertakings
(aggregating their interests) have a direct
or indirect interest of 20 per cent. or more
of the voting or equity capital or the
equivalent;
?Umbro LTIP? means the Umbro Long Term Incentive Plan
2004;
?Umbro ▇▇▇▇ Scheme? means the Umbro Approved Save As You Earn
Share Option Scheme 2004;
?Umbro Share Schemes? means the Umbro ▇▇▇▇ Scheme and the Umbro
LTIP;
?Umbro Shareholders? means the holders of Umbro Shares;
?Umbro Shares? means the ordinary shares of 1 ▇▇▇▇▇ each in
the capital of Umbro;
?Umbro?s Financial Adviser? means JPMorgan Cazenove Limited; and
?VAT? means value added tax as provided for in the
Value Added Tax ▇▇▇ ▇▇▇▇ and/or in Directive
2006/112/EEC and legislation supplemental
thereto and any other legislation,
regulation or other provision amending or
replacing the provisions thereof from time
to time.
1.2 Statutory provisions
All references to statutes, statutory provisions, enactments, EU Directives
or EU Regulations shall include references to any consolidation, re-
enactment, modification or replacement of the same, any statute, statutory
provision, enactment, EU Directive or EU Regulation of which it is a
consolidation, re-enactment, modification or replacement and any subordinate
legislation in force under any of the same from time to time except to the
extent that any consolidation, re-enactment, modification or replacement
enacted after the date of this Agreement would extend or increase the
liability of any party to another under this Agreement.
1.3 Holding company and subsidiary
A company or other entity shall be a ?holding company? for the purposes of
this Agreement if it falls within either the meaning attributed to that term
in section 736 and 736A UK Companies ▇▇▇ ▇▇▇▇ or the meaning attributed to
the term ?parent undertaking? in section 258 UK Companies ▇▇▇ ▇▇▇▇, and a
company or other entity shall be a ?subsidiary? for the purposes of this
Agreement if it falls within either the meaning attributed to that term in
section 736 and 736A UK Companies ▇▇▇ ▇▇▇▇ or the meaning attributed to the
term ?subsidiary undertaking? in section 258 UK Companies ▇▇▇ ▇▇▇▇, and the
terms ?subsidiaries? and ?holding companies? are to be construed accordingly.
1.4 Agreed form
Any reference to a document in the ?agreed form? is to the form of the
relevant document in the terms agreed between Nike Vapor and Umbro prior to
the execution of this Agreement and signed or initialled for identification
purposes only by or on behalf of Nike Vapor and Umbro (in each case with such
amendments as may be agreed by or on behalf of Nike Vapor and Umbro).
1.5 Recitals, schedules, etc.
References to this Agreement include the recitals and schedules which form
part of this Agreement for all purposes. References in this Agreement to the
parties, the recitals, schedules and clauses are references respectively to
the parties and their legal personal representatives, successors and
permitted assigns, the recitals and schedules to and clauses of this
Agreement.
1.6 Meaning of references
Save where specifically required or indicated otherwise:
(a) words importing one gender shall be treated as importing any gender,
words importing individuals shall be treated as importing corporations and
vice versa, words importing the singular shall be treated as importing the
plural and vice versa, and words importing the whole shall be treated as
including a reference to any part thereof;
(b) references to a person shall include any individual, firm, body
corporate, unincorporated association, government, state or agency of state,
association, joint venture or partnership, in each case whether or not having
a separate legal personality. References to a company shall be construed so
as to include any company, corporation or other body corporate wherever and
however incorporated or established;
(c) references to the word ?include? or ?including? (or any similar term)
are not to be construed as implying any limitation and general words
introduced by the word ?other? (or any similar term) shall not be given a
restrictive meaning by reason of the fact that they are preceded by words
indicating a particular class of acts, matters or things;
(d) references to any English statutory provision or legal term for any
action, remedy, method of judicial proceeding, legal document, legal status,
court, official or other legal concept, state of affairs or thing shall in
respect of any jurisdiction other than England be deemed to include that
which most nearly approximates in that jurisdiction to the English statutory
provision or legal term or other legal concept, state of affairs or thing;
(e) any reference to ?writing? or ?written? includes any method of
reproducing words or text in a legible and non-transitory form but, for the
avoidance of doubt, shall not include e-mail; and
(f) references to times of the day are to that time in London and
references to a day are to a period of 24 hours running from midnight to
midnight.
1.7 Headings
Clause and paragraph headings and the table of contents are inserted for ease
of reference only and shall not affect construction.
2. IMPLEMENTATION OF THE ACQUISITION
2.1 Subject to the terms of this Agreement and subject to any extension in
time or termination of this process which may occur in compliance with the
terms of this Agreement, each party undertakes (and, to the extent
appropriate, each party undertakes to procure that the other members of its
Group undertake) to implement the Acquisition in accordance with, and subject
to, the Conditions and, so far as possible, the Timetable with the overall
intention that all Conditions (other than the sanction of the Court) are
satisfied prior to the date on which the First Court Hearing is scheduled to
occur in accordance with the Timetable (the ?Target Hearing Time?). To this
end, the parties will procure the release of the Press Announcement on or
about 7am on the date hereof or such other time and date as may be agreed by
the parties.
2.2 The terms of the Acquisition shall be the terms set out or referred to
in the Press Announcement, together with such other terms as required by law
or regulation and such other terms or other modifications as Nike Vapor and
Umbro may agree in writing. The terms of the Acquisition at the date of
posting of the Scheme Document as so agreed shall be set out in the Scheme
Document. The only conditions to the Acquisition and the Scheme and, if
appropriate, the Takeover Offer shall be the Conditions. Subject to the
terms of this Agreement, and until this Agreement is terminated in accordance
with its terms, each party shall use all reasonable endeavours to achieve
satisfaction of the Conditions as promptly as practical, save that nothing in
this Agreement shall oblige Nike Vapor to waive any of the Conditions or
treat them as satisfied.
2.3 Each of Nike Vapor and Umbro undertakes to the other (to the extent
that such steps have not already been taken prior to the date hereof):
(a) to make, as promptly as reasonably practical, such filings with all
appropriate Relevant Authorities, jointly or separately, as are required in
connection with the Conditions;
(b) to provide as promptly as practical, in consultation with the other
party, such information as maybe reasonably necessary for the purposes of the
filings referred to in clause 2.3(a) or as may be reasonably requested by a
Relevant Authority;
(c) to promptly notify the other party and provide copies of any material
communications with a Relevant Authority in connection with the satisfaction
of the Conditions and the implementation of the Acquisition, save in respect
of any information the circulation of which would adversely affect its own
legitimate business interest; and
(d) if necessary, to negotiate jointly with any Relevant Authority, to
offer any reasonable commitments or undertakings to any Relevant Authority to
remedy that Relevant Authority?s concerns, if any, with a view to obtaining
from that Relevant Authority a decision approving the Acquisition, and to
accept all reasonable conditions, obligations or other requirements imposed
in any decision approving the Acquisition by any Relevant Authority (whether
or not the consent of that Relevant Authority is required to satisfy the
Conditions), unless such negotiation, offer or acceptance would in the
reasonable opinion of one of the parties adversely affect that party?s
legitimate business interests.
2.4 Each party undertakes to keep the other informed reasonably promptly of
developments which are material or potentially material to obtaining
Clearances by the Target Hearing Time (if relevant) and the Acquisition
Effective Date, as set out in the Timetable or which are otherwise likely
materially to affect the implementation of the Acquisition. Umbro shall be
entitled to review any relevant application for Clearance before it is
submitted, and to have its reasonable comments taken into account (provided
that such comments are given as soon as reasonably possible following its
receipt of the relevant draft application, and in any event, within 48 hours
following such receipt, unless the information contained in the relevant
application is reasonably considered by Nike to be competitively sensitive.
2.5 Nike Vapor and Umbro agree as follows:
(a) Nike Vapor and Umbro undertake to consult with the Panel where such
consultation is required for the implementation of the Acquisition;
(b) Nike Vapor agrees that it shall not be entitled to invoke any Condition
so as to cause the Scheme to lapse or be withdrawn where such invocation is
prohibited by the Panel under Rule 13 of the Takeover Code;
(c) Nike Vapor undertakes to confirm to Umbro prior to the First Court
Hearing that it has waived or treated as satisfied or, to the extent
permitted under the Takeover Code and clause 2.5(b), invoked or treated as
incapable of satisfaction each Condition, except if it is aware of any fact,
matter or circumstance indicating that any of the Conditions may be invoked
(whether or not such invocation would be permitted by the Panel under Rule 13
of the Takeover Code), in which case Nike Vapor and Umbro shall use their
reasonable endeavours to procure that the First Court Hearing and, if
reasonably considered necessary, the Second Court Hearing are postponed for
such period as Nike Vapor may reasonably request to allow for the
investigation of such fact, matter or circumstance (and/or, if applicable,
receipt of a relevant Clearance). Following the conclusion of such
investigation (and/or receipt of such Clearance), Nike Vapor shall either
confirm that the relevant Condition has been satisfied or waived or, if
permitted by the Takeover Panel, invoke the relevant Condition; and
(d) the obligations of each of the parties to implement the Scheme (or
where applicable the Takeover Offer) is subject to the satisfaction or, where
permissible, waiver of the Conditions (however Nike Vapor?s obligation to
implement the Scheme (or where applicable the Takeover Offer) does not oblige
Nike Vapor to waive any Condition except as provided in clause 2.5(c)). Umbro
agrees that it shall only file the relevant Court Order with the Registrar if
all of the Conditions are satisfied or, where permissible or required
pursuant to this Agreement, waived by Nike Vapor prior to the grant of the
relevant Court Order.
3. OBLIGATIONS OF NIKE VAPOR AND UMBRO
Steps required to implement the Acquisition
3.1 Subject to clause 4, each of Nike Vapor and Umbro shall, as promptly
and reasonably practical, prepare and, subject to the approval of the Panel,
the UK Listing Authority and the Court, as appropriate, publish and circulate
in the manner approved by the Panel, the UK Listing Authority and/or the
Court, as appropriate:
(a) the Acquisition Document;
(b) such other information, circulars, forms, notices or announcements (as
the case may be), as it may be required by the Takeover Code, the Panel, the
Companies ▇▇▇ ▇▇▇▇, the Companies ▇▇▇ ▇▇▇▇, the Listing Rules, the Exchange
Act, the FSMA or any other applicable laws or regulations; and
(c) such information, circulars, forms, notices or announcements (as the
case may be) as Nike Vapor and Umbro should agree in writing.
3.2 Nike Vapor and Nike undertake to provide all reasonable assistance to
Umbro in relation to the steps to be undertaken by Umbro under clause 2.1 and
the preparation of the underlying documentation, including (without
limitation), access to, and ensuring the provision of reasonable assistance
by, its management and relevant professional advisers.
Further steps required to implement the Scheme
3.3 If, and for so long as, the Acquisition is being implemented by way of
the Scheme, without prejudice to the generality of clause 2.1, Umbro shall
(and shall procure that the relevant member of the Umbro Group shall):
(a) consult with and obtain Nike Vapor?s approval (not to be unreasonably
withheld or delayed) prior to appointing counsel for the purposes of the
Scheme (including the Court Hearing(s));
(b) as soon as reasonably practical following completion of the preparation
of the Acquisition Document, apply to the Court, for leave to convene the
Court Meeting and file such documents as may be necessary in connection
therewith;
(c) subject to the terms of clause 4, finalise and (where required) settle
with the Court the Acquisition Document, all necessary advertisements and
forms of proxy and election and (insofar as required) seek the approval of
the UK Listing Authority and the Panel in relation to such documents;
(d) save as required by law, the Panel or the FSA, Umbro shall not seek to
amend;
(i) the Scheme; or
(ii) the Resolutions or the resolutions to be proposed at the Court
Meeting in the form set out in the Scheme Document,
after despatch of the Scheme Document without the consent of Nike Vapor
provided that nothing in this clause shall prevent Umbro amending the Scheme
so as to give effect to a Competing Proposal if the Inducement Fee has been
paid;
(e) upon (i) the Court making the order necessary for the purpose of
convening the Court Meeting; (ii) any necessary advertisements, the
Acquisition Document and forms of proxy and election being settled with the
Court; and (iii) such document (insofar as required) being approved by Nike
Vapor, the UK Listing Authority and the Panel, Umbro shall, in accordance
with the relevant orders of the Court and in accordance with the Timetable
(or as otherwise agreed by Nike Vapor and Umbro in writing), publish the
requisite advertisements and arrange for the posting of the Acquisition
Document and such other information as the Court may approve and/or direct
from time-to-time in connection with the due implementation of the Scheme to
the Umbro Shareholders (who are on the register of members of Umbro on a
record date to be agreed with the Court) and others entitled to receive the
same, and thereafter in a timely manner publish and/or post such other
document and information as the Court may approve and/or direct from time-to-
time in connection with the due implementation of the Scheme, save as may be
required by the Panel and/or the Takeover Code;
(f) not (unless required by the Court) agree to an extension of time or
variation or amendment to the Scheme or an amendment, revision, withdrawal or
non-enforcement, in whole or in part, of the Scheme without Nike Vapor?s
prior written consent;
(g) subject to clause 3.9 and to clause 5.3 convene, hold and transact the
relevant business at each of the Meetings at the time and date specified in
the Acquisition Document and propose the resolutions set out in the notices
of those meetings (as appropriate) without amendment (save for amendments
made with Nike Vapor?s prior written consent);
(h) prior to the General Meeting, keep Nike Vapor reasonably informed, as
soon as reasonably practicable following each request from Nike Vapor, of the
number of proxy votes received in respect of the resolutions to be proposed
at the General Meeting and the Court Meeting and of the identity of the
relevant Scheme Shareholders;
(i) acknowledge that Nike Vapor may, prior to the General Meeting, appoint
a proxy solicitation agent to facilitate proxy voting by the Umbro
Shareholders (with Umbro?s prior written content, not to be unreasonably
withheld or delayed), provided that this imposes no obligations upon Umbro;
(j) subject to satisfaction or waiver of all Conditions prior to the First
Court Hearing Date, following each of the Meetings, and assuming the
necessary resolutions are passed by the requisite majorities, as soon as
reasonably practical (but in accordance with the Timetable) seek the sanction
of the Court to the Scheme at the First Court Hearing Date and the
confirmation by the Court of the Umbro Capital Reduction at the Second Court
Hearing Date;
(k) subject to applicable confidentiality, legal and regulatory
requirements, to cooperate with and provide such details to Nike Vapor in
relation to the Umbro Share Schemes as Nike Vapor reasonably requires in
order to plan and make proposals to the participants of the Umbro Share
Schemes and, if necessary, to communicate with such participants in respect
of such proposals;
(l) subject to clause 3.3(j) and clause 5.3, as soon as reasonably
practical following the sanction of the Scheme by the Court, to cause an
office copy of the Court Order to be filed with and registered by the
Registrar;
(m) subject to clause 5.3, as soon as reasonably practical following the
confirmation of the Umbro Capital Reduction by the Court, cause an office
copy of the Court Order to be filed with and registered by the Registrar;
(n) take steps in consultation with Nike Vapor to ensure that the issue of
shares to Nike Vapor in accordance with Scheme is effective at the time that
Umbro causes an office copy of the Court Order confirming the Umbro Capital
Reduction to be filed with and registered by the Registrar; and
(o) following the filing of the office copy in accordance with clause
3.3(l) and subject to applicable legal and regulatory requirements, apply to
the UK Listing Authority to cancel the listing of the Umbro Shares on the
Official List and to the London Stock Exchange plc to cancel the admission to
trading of the Umbro Shares on the London Stock Exchange plc?s market for
listed securities so that Umbro Shares will cease to be listed on the
Official List as soon as practicable following the Acquisition Effective
Date.
3.4 Subject to the terms and conditions of this Agreement, Nike Vapor shall
take all such steps as are reasonably necessary to implement the Scheme,
comply with all reasonable procedures and processes imposed by the Court in
connection with the Scheme and agrees to be bound by the Court Order, and if
required by the Court, shall provide an undertaking to the Court to be so
bound by the Scheme including as to the discharge of the consideration due to
Umbro Shareholders.
Change to different structure
3.5 Nike Vapor may elect, at any time (at its absolute discretion), by
delivering written notice to Umbro to that effect, to implement the
Acquisition by way of the Takeover Offer, whether or not the Scheme Circular
has been posted, provided that:
(a) the Takeover Offer is implemented in accordance with the Takeover Offer
Conditions;
(b) Nike Vapor consults with Umbro before making that election; and
(c) the Takeover Offer is made on terms that Umbro?s Financial Adviser
reasonably considers are financially at least as favourable as the terms of
the Scheme.
Umbro shall take all reasonable steps to support the application by Nike
Vapor to the Panel for the consent of the Panel to the Acquisition being
implemented by way of a Takeover Offer and not by way of the Scheme, subject
to (a), (b) and (c).
3.6 If Nike Vapor elects to implement the Acquisition by way of a Takeover
Offer (whether pursuant to clause 3.5 or clause 3.7), clauses 3.3 (other than
clause 3.3(o)) and 4.2 will not apply, but clause 4.3 will apply, and the
other provisions of this Agreement, to the extent applicable to the
implementation of the Acquisition by way of a Takeover Offer, will also apply
mutatis mutandis to such Takeover Offer.
3.7 In the event that the Scheme is not approved by the Scheme Shareholders
at the Court Meeting and/or any or all the resolutions proposed at the
General Meeting are not passed, then Nike Vapor shall by delivery of written
notice to Umbro within five Business Days of the relevant Meeting(s) be
entitled, with the consent of the Panel, to implement the Acquisition by way
of a Takeover Offer subject to provisions of clauses 3.5 (a), (b) and (c).
In such circumstances Umbro shall take all reasonable steps to support any
application by Nike Vapor to the Panel (before and/or after the Court Meeting
and the General Meeting) to waive the requirements of Rule 35 or any other
applicable provisions of the Takeover Code affecting such election and for
the consent of the Panel to the Acquisition being implemented by way of a
Takeover Offer and not by way of the Scheme.
3.8 Other than following the announcement of a Competing Proposal, any
election to implement the Acquisition by way of the Takeover Offer after the
later to occur of the Scheme being approved by the Scheme Shareholders at the
Court Meeting and the passing of all the resolutions to be proposed at the
General Meeting, shall be subject to the prior written approval of Umbro (not
to be unreasonably withheld or delayed).
Postponement of Meetings and Court Hearings or Day 60 and/or Day 81
3.9 In the event that:
(a) the Acquisition is being implemented by way of the Scheme, Umbro shall,
at the request of Nike Vapor, take all necessary actions to adjourn the Court
Meeting and the General Meeting to such time and date as Nike Vapor may
require (provided that the effect of such adjournment shall not be to cause
the Effective Date to be later than the 180 days after the Scheme Circular
has been proposed) provided that such adjournment is reasonably considered
necessary to implement the Acquisition or avoid the Acquisition lapsing; or
(b) either Nike Vapor or Umbro receive independent legal advice that, as a
result of a legal or regulatory requirement or in order not to prejudice the
likelihood of the Scheme being sanctioned by the Court (or, if the
Acquisition is being implemented by way of a Takeover Offer, all Conditions
being satisfied by Day 81), it is necessary or desirable to postpone or
adjourn the Court Meeting and/or the General Meeting and/or the First Court
Hearing and/or the Second Court Hearing (or, if the Acquisition is being
implemented by way of a Takeover Offer, Day 81), including in the event that
it is reasonably likely prior to the date on which the Meetings are to be
held (including any adjournment or postponement thereof) that the Office of
Fair Trading will not prior to such date have published a notice either:
(i) granting clearance in respect of the Acquisition; or
(ii) confirming that the Acquisition will not be referred to the Competition
Commission.
then the parties will together use all reasonable endeavours to postpone
and/or adjourn any of such Meetings or the First Court Hearing and/or the
Second Court Hearing (or, if the Acquisition is being implemented by way of a
Takeover Offer, apply jointly to the Panel for an extension of Day 60 and/or
an extension of Day 81), to a date or dates agreed between the parties (and
failing such agreement, to the date falling one month after the date for
which such Meetings or the Court Hearings were originally convened (or Day 60
and/or Day 81 was scheduled) or, if such day is not a Business Day, the next
following Business Day).
General
3.10 Each party shall use its reasonable endeavours to procure that its
Representatives shall do all such acts as reasonably necessary to give effect
to the terms of this Agreement and the Acquisition.
3.11 For the avoidance of doubt, other than its obligations under clause
3.2, Nike will have no obligations (or be held liable for the performance of
such) under this Agreement.
4. PUBLICATION OF THE ACQUISITION DOCUMENT
4.1 Umbro and Nike Vapor agree:
(a) that Umbro shall prepare the Scheme Document;
(b) that the Acquisition Document will contain provisions in accordance
with the terms and Conditions set out in the Press Announcement (including
any modifications thereto agreed between Nike Vapor and Umbro); and
(c) to cooperate and consult with each other in the preparation and the
publication of any other document or filing which is required or which Nike
Vapor and Umbro (as the case may be) reasonably consider to be necessary or
appropriate for the purposes of implementing the Acquisition.
4.2 If Nike Vapor implements the Acquisition by way of the Scheme:
(a) Nike Vapor undertakes to provide Umbro as soon as reasonably practical
with all such information about itself and its Group as may reasonably be
required for inclusion in the Scheme Circular, and to provide all such other
assistance as may reasonably be required in connection with the preparation
of the Scheme Circular, including access to, and ensuring the provision of
reasonable assistance by, its management and relevant professional advisers;
(b) Umbro agrees to take Nike Vapor?s reasonable comments on the form and
content of the Scheme Circular into account and to afford Nike Vapor
sufficient time to consider the Scheme Circular in order to give such
comments before the Scheme Circular is posted; and
(c) save as otherwise required under the Takeover Code, Umbro shall not
dispatch the Scheme Circular until Nike Vapor has approved it in writing
(such approval not to be unreasonably withheld or delayed).
4.3 If Nike Vapor elects to implement the Acquisition by way of the
Takeover Offer in accordance with clause 3.5 or clause 3.7:
(a) Umbro undertakes to provide Nike Vapor as soon as reasonably practical
with all such information about itself and its Group as may reasonably be
required for inclusion in the Offer Document and to provide all such other
assistance as may reasonably be required in connection with the preparation
of the Offer Document, including access to, and ensuring the provision of
reasonable assistance by, relevant professional advisers;
(b) Nike Vapor agrees to take Umbro?s reasonable comments on the form and
content of the Offer Document into account and to afford Umbro sufficient
time to consider the Offer Document in order to give such comments before the
Offer Document is posted;
(c) Nike Vapor undertakes that the Takeover Offer shall be conditional on
valid acceptances being received in respect of not less than 90 per cent. (or
such lesser percentage, being more than 50 per cent., as Nike may decide) of:
(i) the shares to which such offer relates; and (ii) the voting rights
normally exercisable at a general meeting of Umbro, including, for this
purpose, any such voting rights attaching to Umbro Shares that are
unconditionally allotted or issued before the Takeover Offer becomes or is
declared unconditional as to acceptances, whether pursuant to the exercise of
any outstanding subscription or conversion rights or otherwise; and
(d) save as otherwise required under the Takeover Code, Nike Vapor shall
not dispatch the Offer Document until Umbro has approved it in writing (such
approval not to be unreasonably withheld or delayed).
4.4 Should any supplemental circular or announcement be required to be
published and/or submitted to the Court in connection with the Acquisition (a
?Supplemental Document?) each party shall provide such cooperation and
information (including such information as is necessary for the Supplemental
Document to comply with all applicable legal and regulatory provisions) as
the other may reasonably request and as may be reasonably necessary to
formalise and publish promptly such Supplemental Document.
5. RECOMMENDATION
5.1 Umbro agrees that, subject to clause 5.2, the Acquisition Document
shall incorporate a unanimous and unqualified recommendation from the
Directors to vote in favour of the Scheme and the resolutions to be proposed
at the Meetings and/or to accept the Takeover Offer (as the case may be) as
they shall do in relation to their own holdings of Umbro Shares.
5.2 The Acquisition Document shall not be required to incorporate a
recommendation by the Directors, and the Directors shall be entitled to
withdraw or modify any recommendation in the Acquisition Document, if and to
the extent that the Directors, after taking independent legal advice in
relation to their fiduciary duties, consider in good faith that:
(a) to give such recommendation or to fail to withdraw, modify or qualify
their recommendation would be a breach of their fiduciary duties to Umbro or
a breach of their obligations under the Takeover Code; or
(b) such recommendation needs to be modified in the light of financial
advice received which they are required to disclose to Umbro Shareholders
under Rule 3.1 of the Takeover Code.
5.3 If the Directors, having taken independent legal advice in relation to
their fiduciary duties to Umbro consider in good faith that they would be in
breach of their fiduciary duties if they did not adjourn any meeting or
hearing or did not delay the filing of any petition or order, Umbro shall not
be obliged, to that extent, to proceed with any such step or refrain from
taking any step which is inconsistent with the Acquisition.
5.4 By exercising its rights in accordance with this clause 5, Umbro shall
not be taken to be in breach of any relevant clause in this Agreement.
6. COMPETING PROPOSALS
6.1 Umbro agrees that:
(a) if it considers, or if the Directors determine (whether before or after
their Press Announcement is made) that any Competing Proposal constitutes a
Superior Proposal, it shall, in addition to its obligations pursuant to
clause 7.3, confirm to Nike Vapor in writing (a ?Superior Proposal Notice?)
as soon as reasonably practical that such Competing Proposal constitutes a
Superior Proposal, provide the material details of such Competing Proposal
(in particular the offer price contained in the Competing Proposal, the
nature of the consideration and the identity of the party making the Superior
Proposal) and the reasons that led the Directors to determine that it
constitutes a Superior Proposal, and notify Nike Vapor in such notice that it
has called for a meeting of the Directors to consider whether or not to
recommend the Superior Proposal (whether such recommendation is to be given
before or after such Superior Proposal is announced) and of the time and date
of such meeting (which shall be no sooner than midday on the fourth Business
Day after the Business Day during which (or if not during which, following
which) the Superior Proposal Notice was given) (the ?Recommendation Board
Meeting?); and
(b) it and the Directors shall not formally recommend any Competing
Proposal (whether or not it is a Superior Proposal and whether before or
after the Press Announcement is made) or (having received a Competing
Proposal) withdraw the Scheme or adjourn any of the Meetings (if applicable),
unless so directed by the Court and subject to the Directors fiduciary duties
and duties under the Takeover Code, until the first to occur of the
Recommendation Board Meeting, in the case of a Superior Competing Proposal,
or 5.00 p.m. on the fourth Business Day after the date of the announcement
pursuant to Rule 2.5 of a Competing Proposal whether or not it is a Superior
Competing Proposal (a ?Competing Announcement?).
6.2 If:
(a) Nike Vapor confirms in writing to Umbro?s Financial Adviser on or
before the first to occur of (i) the time which is no later than 5.00 p.m. on
the third Business Day after the Business Day during which (or if not during
which, following which) the Superior Proposal Notice was given; or (ii)
before 12.00 p.m. on the fourth Business Day after the date of the Competing
Announcement in relation to the Competing Proposal (whether or not it is a
Superior Proposal), that it intends to increase the price to be paid under
the Acquisition to an effective price per Umbro Share equal to or greater
than provided under the Superior Proposal or Competing Proposal, as the case
may be, or make an offer or proposal which in the opinion of Umbro?s
Financial Adviser (acting reasonably) both provides equal or superior
financial value to Umbro Shareholders in comparison to such Superior Proposal
or Competing Proposal and is otherwise on terms which are substantially
equivalent to or not materially worse (from the point of view of Umbro
Shareholders) than those contained in such Superior Proposal or Competing
Proposal (the ?Revised Acquisition?); and
(b) Nike Vapor confirms in writing to Umbro?s Financial Adviser on or
before the first to occur of (i) the time which is no later than the start of
the Recommendation Board Meeting, in the case of a Superior Proposal; or (ii)
before 5.00 p.m. on the fourth Business Day after the date of a Competing
Announcement, that it is ready to announce, or announces, the Revised
Acquisition,
the Directors shall, provided that doing so would not place them in breach of
their fiduciary duties and obligations under the Takeover Code, make a
unanimous and unqualified recommendation of the Revised Acquisition to the
Umbro Shareholders. Umbro shall notify Nike Vapor of the results of its
deliberations within two hours of the completion of the Recommendation Board
Meeting (for a Superior Proposal) or by not later than 7.00 p.m. on the
fourth Business Day (for a Competing Proposal). If such notice is of a
unanimous and unqualified recommendation of the Revised Acquisition, Nike
Vapor shall be entitled to refer to such recommendation in its Revised
Acquisition announcement referred to in sub-clause (b) and the Directors
shall not recommend the Superior Proposal set out in the Superior Proposal
Notice or the Competing Proposal set out in the Competing Announcement and,
for the avoidance of doubt, subject to the provisions of clause 9, no
Inducement Fee will be payable in these circumstances.
6.3 In the event that a ?competitive situation? arises pursuant to Rule
33.5 of the Takeover Code in relation to Nike Vapor and a third party or
parties, Umbro, the Directors and Umbro?s Financial Adviser shall involve
Nike Vapor in and shall keep Nike Vapor fully informed of any discussions
with the Panel.
6.4 If the Panel imposes an auction procedure that would require Umbro to
breach its obligations set out in clauses 6.1 and/or 6.2, Nike Vapor and
Umbro agree that the relevant provisions of clauses 6.1 and/or 6.2 shall not
apply to the extent required to permit Umbro to comply with the auction
procedure imposed by the Panel pursuant to Rule 33.5 of the Takeover Code.
7. CONDUCT OF BUSINESS PENDING COMPLETION OF THE ACQUISITION
7.1 Pending the Acquisition Effective Date or earlier termination of this
Agreement, and without prejudice to Rule 21 of the Takeover Code, but subject
to the provisions of Clause 8, Umbro shall and shall procure that each member
of its Group shall:
(a) carry on its businesses in the ordinary course as conducted prior to
the date hereof and, unless fairly disclosed to Nike Vapor or Nike prior to
the date of this Agreement or in accordance with the terms of existing
arrangements entered into prior to the date of this Agreement or with the
consent of Nike Vapor (such consent not to be unreasonably withheld or
delayed), shall not undertake any material commitment or enter into or
terminate any material contract or acquire or dispose of any material assets,
liabilities or businesses in each case otherwise than in the ordinary course
of business as conducted prior to the date hereof. For the purposes of this
clause 7.1(a), a matter shall be material if it amounts to or exceeds an
aggregate amount of (pound sterling) 1,000,000;
(b) disclose to Nike Vapor as soon as reasonably practical any matter of
which it is aware which is reasonably likely to constitute a breach of any of
the Conditions or results in any event not being satisfied in the timescale
now contemplated by the Timetable;
(c) not (without the prior written consent of Nike Vapor, not to be
unreasonably withheld or delayed);
(i) change the general terms of employment of its employees or the terms of
employment of its directors in any way, other than in the ordinary course of
business;
(ii) adopt or amend any employee benefit scheme (including without
limitation any scheme having share purchase or share option provisions);
(iii) enter into any arrangements with the trustees of any pension scheme, in
which it or any member of its Group participates or pay employer
contributions to such scheme other than those employer contributions agreed
with the trustees at the date of this Agreement, save as required by law or
regulation or the rules of any such scheme;
(iv) recommend, declare, announce, pay or make or propose the
recommendation, declaration, payment or making of, any bonus, dividend, or
other distribution to its shareholders, other than by wholly owned
subsidiaries of Umbro;
(v) except in respect of options granted as at the date of this Agreement
under Umbro Share Schemes and save as contemplated pursuant to the Scheme,
alter the authorised or allotted or issued share capital of Umbro, nor grant
any options or other rights to subscribe for any shares under the Umbro Share
Schemes;
(vi) other than as contemplated by clause 7.2 amend the memorandum or
articles of association of any member of Umbro?s Group;
(vii) otherwise take any action which it knows would be prejudicial to the
successful outcome of the Acquisition or the satisfaction of the Conditions,
except (i) in accordance with clause 5.2 or clause 5.3; or (ii) to comply
with law or regulation; or (iii) in compliance with written instructions from
Nike Vapor;
(viii) to pay, accelerate or otherwise amend the terms of any indebtedness
outstanding by members of the Umbro Group otherwise than in the usual course
of carrying on its business or cancel any facilities available to Umbro; or
(ix) agree to do any of the above.
7.2 Umbro undertakes that, except with the prior written consent of Nike
Vapor, it will not submit to its shareholders for approval in general meeting
any resolution which, if passed, would constitute ?approval? for the purposes
of Rule 21.1 of the Takeover Code nor seek consent of the Panel to proceed
with any action to which Rule 21.1 of the Takeover Code is applicable without
such approval. Umbro shall propose to Umbro Shareholders such changes to
Umbro?s articles of association as set out in Schedule 3.
7.3 Subject to the release of the Announcement in accordance with clause 12
and subject to the Acquisition not already having lapsed or been withdrawn or
the Conditions to the Acquisition not being incapable of being satisfied
(unless waived) in accordance with such Announcement, and without prejudice
to any obligation to provide information under Rule 20.2 of the Takeover
Code, Umbro hereby undertakes to Nike and Nike Vapor that:
(a) in the period from the date of this Agreement to the Acquisition
Effective Date (or, if a Takeover Offer is made, the date on which the
Takeover Offer becomes or is declared unconditional in all respects) (the
?Exclusivity Period?) it shall not, and it shall procure that no members of
the Umbro Group (or any of its or their respective directors, employees,
advisors, agents or representatives) (the ?Connected Persons?) shall,
solicit, initiate, encourage, induce or knowingly facilitate the
communication, making, submission or announcement of any Competing Proposal.
Umbro hereby undertakes to Nike and Nike Vapor that during the Exclusivity
Period, it shall not negotiate with any person with respect to a Competing
Proposal unless the Board determines, in good faith, after consultation with
external legal advisers, that the failure to negotiate with such third party
would be in breach of the fiduciary duties of the Board or their duties under
the Takeover Code and Umbro shall promptly inform Nike that it is engaging in
such negotiations; and
(b) that, during the Exclusivity Period it shall, as soon as reasonably
practicable (and in no event later than 24 hours after Umbro or any Connected
Person becomes aware of any such proposal or request for information), notify
Nike and Nike Vapor that it or any Connected Person has received or has
become aware of any unsolicited Competing Proposal or request for information
under Rule 20.2 of the Code, and will disclose to Nike and Nike Vapor any
price or price range or the total amount of consideration specified in such
Competing Proposal. Umbro shall not provide any information to such person
unless Umbro and such person enters into a non-disclosure agreement that is
on substantially similar terms to the confidentiality agreement dated 5
October 2007 between Nike and Umbro, and shall provide to Nike Vapor any
information that it provides to a third party in connection with any
Competing Proposal,
7.4 Umbro confirms and undertakes:
(a) that it is a ?foreign private issuer? as such term is defined under
Rule 3b-4(c) under the Exchange Act; and
(b) to use its reasonable efforts to assist Nike Vapor in making a
calculation of the percentage of Umbro?s share capital held (beneficially or
otherwise) by US holders in accordance with Instruction 2 to Rules 14d-1(c)
and (d) under the Exchange Act, including to furnish Nike Vapor, upon the
request of Nike Vapor in writing, a copy of Umbro?s Register of Shareholders
and, to the extent reasonably available to Umbro, a beneficial ownership
analysis to be stated as of (i) the date which is the 30th calendar day prior
to the commencement (within the meaning of the Exchange Act) of the tender
offer (within the meaning of the Exchange Act) by Nike Vapor for the share
capital of Umbro; and (ii) such other dates as may be agreed by Nike Vapor
and Umbro.
8. EMPLOYEE COMPENSATION AND BENEFITS
8.1 Umbro confirms that the Resolutions were duly passed by the
Remuneration Committee at a meeting properly convened and held at which a
quorum was present throughout and have not been amended or rescinded and are
in full force and effect and Nike, Inc. and Nike Vapor confirm that they
agree that options under the Umbro LTIP shall be exercisable to the extent
set out in the Resolutions.
8.2 Umbro undertakes, subject to clause 8.3, that, unless and until such
time as this Agreement is terminated pursuant to clause 10, it will not amend
the terms of the Umbro ▇▇▇▇ Scheme, the Umbro LTIP or the Umbro Executive
Bonus Scheme nor introduce or agree to introduce (nor permit any member of
the Umbro Group to introduce or agree to introduce) any new or revised share
option scheme, incentive scheme or plan or other benefits relating to the
employment or termination of employment of any Umbro Group employees, nor
exercise or agree to exercise (or permit any member of the Umbro Group to
exercise or agree to exercise) any discretion thereunder to waive or modify
any performance or other conditions to entitlement under any such schemes or
plans (including in particular the performance criteria relating to the Umbro
Executive Bonus Scheme), nor to exercise or agree to exercise (or permit any
member of the Umbro Group to exercise or agree to exercise) any discretion to
increase the awards or amounts payable thereunder for any reason.
8.3 Umbro shall be entitled to pay a bonus under the Umbro Executive Bonus
Scheme to such employees as the Board considers appropriate in respect of the
calendar year 2007, notwithstanding that the performance criteria may not
have been met, provided that the aggregate amount payable under that scheme
for the year shall not exceed (pound sterling) 500,000. Umbro undertakes to
use its best endeavours to amend the Umbro Executive Bonus Scheme to provide
that the scheme will terminate with immediate effect upon Completion.
8.4 Nike Vapor undertakes that, if Completion occurs, it will procure that
Umbro implements an employee incentive package in place of the Umbro LTIP,
the Umbro ▇▇▇▇ Scheme and the Umbro Executive Bonus Scheme which is
consistent with that made available by the Nike Group in respect of its other
UK businesses.
8.5 Umbro undertakes that it will implement a new employee retention bonus
plan (the ?Retention Plan?) with the following attributes.
(a) The purpose of the Retention Plan shall be to incentivise certain
existing employees of the Umbro Group to remain employed by the Umbro Group.
(b) The maximum aggregate amount available for disbursement under the New
Bonus Scheme shall be (pound sterling) 2.2 million.
(c) The Retention Plan shall be operated by a committee (the ?Committee?)
which shall comprise two members nominated by the Chairman of the Board and
two members nominated by the Chairman of the Board of Vapor. No action shall
be taken in respect of the Retention Plan without the consent of the
Committee. The quorum for the transaction of business by the Committee shall
be two persons, one of whom shall be a member nominated by the Chairman of
the Board and one of whom shall be a member nominated by the Chairman of the
Board of Vapor.
(d) The Committee shall have discretion to decide which of the existing
employees of the Umbro Group shall be eligible for a retention bonus and in
respect of what amounts.
(e) The amount available for payment under the Retention Plan to an
employee will be payable in three equal instalments payable on Completion, on
the date falling six months following Completion and on the date falling 12
months after Completion.
(f) No employee shall be entitled to receive an instalment of his or her
bonus unless he or she remains employed by the Umbro Group on the date on
which the payment falls due, and is not under notice of termination of
employment as at that date (whether such notice is given by the employee or
the relevant member of the Umbro Group). Notwithstanding the above, an
employee or, as the case may be, his or her personal representatives, shall
be entitled to receive one or more instalments under the Retention Plan if he
or she is not employed by the Umbro Group, or is under notice of termination
of employment, at the relevant date as a result of:
(i) death;
(ii) long term disability;
(iii) termination of his or her employment by a member of the Umbro Group in
breach of the terms of his or her employment contract; or
(iv) redundancy.
(g) Umbro and Nike Vapor will jointly agree all employee announcements in
relation to the proposed Acquisition and, in particular, the Retention Plan
and will use their respective reasonable endeavours to put contractual
arrangements into place with relevant employees of the Umbro Group as soon as
reasonably possible following the release of the Press Announcement to
reflect the terms of this clause 8.5.
9. INDUCEMENT FEE
9.1 As an inducement for Nike Vapor agreeing to the release of the Press
Announcement and for the occurrence of an Inducement Fee Payment Event (as
defined below), Umbro undertakes to pay to Nike Vapor (or to such other
person as Nike Vapor may direct) an amount equal to 1 per cent. of the value
of the aggregate consideration payable under the Acquisition calculated by
reference to (1) the price per Umbro Share set out in the Press Announcement
(or, if the price per Umbro Share is revised, the price per Umbro Share last
offered by Nike Vapor) and (2) the fully diluted equity share capital of
Umbro (the ?Inducement Fee?). The Inducement Fee shall be inclusive of any
irrecoverable VAT thereon. An Inducement Fee Payment Event shall be if Nike
Vapor makes a Press Announcement in accordance with Rule 2.5 of the Takeover
Code, which is recommended by the Board, and:
(a) prior to the Scheme or, as the case may be, Takeover Offer lapsing or
being withdrawn a Competing Proposal is announced (whether or not on a pre-
conditional basis and whether pursuant to Rule 2.4 of the Takeover Code, Rule
2.5 of the Takeover Code or otherwise), and the Acquisition does not become
effective or, if implemented by way of Takeover Offer, does not become or is
not declared unconditional in all respects and such Competing Proposal or any
other Competing Proposal becomes effective or unconditional in all respects
or is otherwise completed within 12 months of the Scheme or, as the case may
be, Takeover Offer, lapsing or being withdrawn; or
(b) the Scheme Document does not contain the unanimous and unqualified
recommendation of the Board to vote in favour of the Scheme and the
resolutions to be proposed at the meetings or, if Nike elects to implement
the Acquisition by way of the Takeover Offer, the Offer Document does not
contain the unanimous and unqualified recommendation of the Board to accept
such offer (in each case as set out in clause 5.1), and the Acquisition does
not become effective or, if implemented by way of a Takeover Offer, does not
become or is not declared unconditional in all respects; or
(c) before the Acquisition lapses or is withdrawn one or more of the Board
withdraws, qualifies or adversely modifies their recommendation of the
Acquisition and the Acquisition does not become effective or, if implemented
by way of a Takeover Offer, does not become or is not declared unconditional
in all respects; or
(d) the Acquisition is to be implemented by way of a Scheme and Umbro is in
material breach of its obligations under clause 2.3 or clause 3.3 (except 3.3
(a), (h), (i), (k), (n) and (o))
9.2 On the occurrence of an Inducement Fee Payment Event, Umbro shall pay
the Inducement Fee no later than five Business Days after the date on which
Nike Vapor delivers a notice to Umbro requiring payment of the Inducement
Fee.
9.3 The parties shall use all reasonable endeavours to ensure that the sum
payable under clause 9.1 will not be subject to VAT. However, if it is
determined that all or part of such payment constitutes the consideration for
a supply made for VAT purposes:
(a) if the Inducement Fee is a consideration for a taxable supply in
respect to which the recipient of the Inducement Fee (or the representative
member of the Group of which the recipient of the Inducement Fee is a member)
is liable to account for VAT, to the extent that such VAT is recoverable by
Umbro (or the representative member of the Group of which Umbro is a member)
by repayment or credit, the amount of the recoverable VAT shall be paid in
addition to the Inducement Fee; for the avoidance of doubt if and to the
extent that such VAT is irrecoverable by Umbro (or the representative member
of the Group of which Umbro is a member) then no additional amount shall to
that extent be paid in respect of such VAT and the Inducement Fee shall, to
that extent, be VAT inclusive; and
(b) if VAT is due from Umbro (or the representative member of the Group of
which Umbro is a member) under the reverse charge mechanism, to the extent
that any VAT chargeable on the supply is not recoverable by Umbro (or the
representative member of the Group of which Umbro is a member) by repayment
or credit, the amount of the Inducement Fee shall be reduced to such amount
so that the aggregate of the Inducement Fee and such irrecoverable reverse
charge VAT equals the amount of the Inducement Fee had no such irrecoverable
reverse charge VAT arisen.
9.4 Such adjusting payment as may be required between the parties to give
effect to clause 9.3 shall be made five Business Days after the date on which
it is determined that the Inducement Fee constitutes the consideration for a
supply made for VAT purposes (together with such evidence of it as is
reasonable in the circumstances to provide and, where clause 9.3(a) applies,
together with the provision of a valid VAT invoice) or, if later, (in the
case of clause 9.3(a)) five Business Days after the VAT is recovered or (in
the case of clause 9.3(b)) five Business Days after the VAT is required to be
accounted for.
9.5 Umbro shall (or shall procure that the representative member of the VAT
Group of which Umbro is a member) use its reasonable endeavours to obtain any
available repayment or credit in respect of VAT (as referred to in this
clause 9) and for the purposes of this clause 9 the extent of such repayment
or credit shall be determined by Umbro or the relevant representative member
of the VAT Group, acting reasonably.
9.6 Nothing in this Agreement shall oblige Umbro to pay any amount which
the Panel determines would not be permitted by Rule 21.2 of the Takeover
Code, or which causes the transaction to be a Class 1 transaction under Rule
10.2.7 of the Listing Rules.
9.7 Subject to clause 10.1, without prejudice to Nike Vapor?s obligations
under the Code, if any of the circumstances in clause 9.1 occurs, Nike Vapor
shall be immediately released from its obligations under this Agreement and
Umbro shall be immediately released from its obligations under this Agreement
(other than in respect of the Inducement Fee).
10. TERMINATION
10.1 This Agreement shall be terminated (and, subject to clause 10.2, all
obligations of Nike Vapor, Nike and Umbro under this Agreement shall cease)
upon the earliest to occur of:
(a) agreement in writing between Nike Vapor and Umbro at any time prior to
the Acquisition Effective Date;
(b) other than where Nike Vapor elects in accordance with clause 3.5 or
3.7 to implement the Acquisition by way of the Takeover Offer, the Scheme not
being sanctioned by the Scheme Shareholders at the Court Meeting or any of
the resolutions to be proposed at the General Meeting, and which are set out
in the notice of that meeting, not being so approved at the General Meeting
and no notice having been delivered within the time period specified under
clause 3.7. For the avoidance of doubt, if either of the Meetings is
adjourned, the date that a particular resolution is put to shareholders will,
for all purposes, be the date of the reconvened meeting at which the vote on
that resolution is actually held;
(c) immediately upon Clause 9.7 becoming effective;
(d) save as the parties may agree in writing, the date which is 180 days
after the Scheme Circular is posted if the Acquisition Effective Date has not
occurred on or before that date; or
(e) the Acquisition lapsing or being withdrawn in accordance with the
Takeover Code (whether because any Condition is invoked or otherwise).
10.2 Termination of this Agreement shall be without prejudice to the rights
of any of the parties which have arisen on or prior to the termination
including (without limitation) any claim in respect of a breach of this
Agreement. Clauses 1, 9 (including clause 9.1 notwithstanding termination
pursuant to clause 10.1(d)), 13 to 25 shall survive the termination of this
Agreement.
11. CONFIRMATIONS
Each Party confirms to the others than it is not aware of (and undertakes to
notify the other parties as soon as reasonably practicable after it becomes
aware of) any act, matter or thing which would or is reasonably likely to
cause any of the Conditions not to be satisfied in a manner which is material
in the context of the Acquisition or which would prevent it acting in
accordance with the Announcement or its obligations under this Agreement.
12. ANNOUNCEMENT
Immediately following the execution of this Agreement (or, if later, the
termination of any escrow period following such execution), Nike Vapor and
Umbro shall procure the release of the Press Announcement and the obligations
of the parties under this Agreement, other than in respect of this clause 12
shall be conditional on such release.
13. FURTHER ANNOUNCEMENTS
13.1 Subject to clause 13.2, prior to satisfaction or waiver (as the case
may be) of the Conditions, except as may be otherwise agreed by Nike Vapor
and Umbro, no announcement or statement shall be made regarding the
Acquisition except on a joint basis or on terms agreed in advance by Nike
Vapor and Umbro.
13.2 The restriction in clause 13.1 shall not apply to any announcement or
statements required by applicable law, regulation, court order, Relevant
Authority, or the rules of any stock exchange provided that the party
required to make such an announcement or statement will, if practical,
consult with the other party as to the content and timing of such
announcement or statement and the extent of the required disclosure.
14. CONFIDENTIALITY
For the avoidance of doubt, termination of this agreement shall be without
prejudice to the confidentiality agreement dated 5 October 2007 between Nike
and Umbro, which shall continue in full force and effect notwithstanding such
termination.
15. COUNTERPARTS
This Agreement may be executed in any number of counterparts and by the
parties to it on separate counterparts and each such counterpart shall
constitute an original of this Agreement but all of which together constitute
one and the same instrument. This Agreement shall not be effective until
each party has executed at least one counterpart.
16. VARIATION, WAIVER AND CONSENT
16.1 Variation/waiver to be in writing
No variation or waiver of any provision or condition of this Agreement shall
be effective unless it is in writing and signed by or on behalf of each of
the parties (or, in the case of a waiver, by or on behalf of the party
waiving compliance).
16.2 Variation/waiver shall not affect other rights
Unless expressly agreed, no variation or waiver of any provision or condition
of this Agreement shall constitute a general variation or waiver of any
provision or condition of this Agreement, nor shall it affect any rights,
obligations or liabilities under or pursuant to this Agreement which have
already accrued up to the date of variation or waiver, and the rights and
obligations of the parties under or pursuant to this Agreement shall remain
in full force and effect, except and only to the extent that they are so
varied or waived.
16.3 Consent to be in writing
Any consent granted under this Agreement shall be effective only if given in
writing and signed by the consenting party and then only in the instance and
for the purpose for which it was given.
17. RIGHTS AND REMEDIES CUMULATIVE
17.1 Enforcement of rights
No failure or delay by any party in exercising any right or remedy provided
by law or under or pursuant to this Agreement shall impair such right or
remedy or operate or be construed as a waiver or variation of it or preclude
its exercise at any subsequent time. No single or partial exercise of any
right or remedy by any party shall preclude any other or further exercise of
such right or remedy or the exercise of any other right or remedy.
17.2 Remedies cumulative
The rights, powers and remedies provided by this Agreement are cumulative and
are in addition to any rights, powers and remedies provided by law.
18. ENTIRE AGREEMENT
18.1 Entire agreement
Subject to any terms implied by law, this Agreement and the confidentiality
agreement between Nike and Umbro dated 5 October 2007 together represent the
whole and only agreement between the parties in relation to the Acquisition
and supersede any previous agreement (whether written or oral) between any of
the parties in relation to the subject matter of any such document save that
nothing in this Agreement shall exclude any liability for, or remedy in
respect of, fraudulent misrepresentation.
19. NOTICES
19.1 Save as otherwise provided in this Agreement, any notice, demand or
other communication (?Notice?) to be given by any party under, or in
connection with, this Agreement shall be in writing and signed by or on
behalf of the party giving it. Any Notice shall be served by sending it by
fax to the number set out in clause 19.2, or delivering it by hand to the
address set out in clause 19.2 and in each case marked for the attention of
the relevant party set out in clause 19.2 (or as otherwise notified from time
to time in accordance with the provisions of this clause 19). Any Notice so
served by fax or hand shall be deemed to have been duly given or made as
follows:
(a) if sent by fax, at the time of transmission; or
(b) in the case of delivery by hand, when delivered,
provided that in each case where delivery by fax or by hand occurs after 6.00
p.m. on a Business Day or on a day which is not a Business Day, service shall
be deemed to occur at 9.00 a.m. on the following Business Day.
References to time in this clause 19 are to local time in the country of the
addressee.
19.2 The addresses and fax numbers of the parties for the purpose of clause
19.1 are as follows:
(a) Umbro
Address: ▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇
Fax: ▇▇▇ ▇▇▇ ▇▇▇ ▇▇▇▇
For the attention of: the Company Secretary
(b) Nike Vapor
Address: ▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Fax: ▇▇ ▇▇▇ ▇▇▇ ▇▇▇▇
For the attention of: ▇▇▇▇ ▇▇▇▇▇▇
with a copy (which shall not in itself constitute a Notice) to:
Nike European Operations Netherlands BV
Address: ▇▇▇▇▇▇▇▇▇ ▇, ▇▇▇▇ ▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇
Fax: ▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇
For the attention of: ▇▇▇▇▇ ▇▇▇▇▇▇
(c) Nike
Address: ▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Fax: ▇▇ ▇▇▇ ▇▇▇ ▇▇▇▇
For the attention of: ▇▇▇▇ ▇▇▇▇▇▇
with a copy (which shall not in itself constitute a Notice) to:
Nike European Operations Netherlands BV
Address: ▇▇▇▇▇▇▇▇▇ ▇, ▇▇▇▇ ▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇
Fax: ▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇
For the attention of: ▇▇▇▇▇ ▇▇▇▇▇▇
19.3 A party may notify all other parties to this Agreement of a change to
its name, relevant addressee, address or fax number for the purposes of this
clause 19, provided that such notice shall only be effective on:
(a) the date specified in the notification as the date on which the change
is to take place; or
(b) if no date is specified or the date specified is less than five
Business Days after the date on which notice is given, the date following
five Business Days after notice of any change has been given.
19.4 In proving service it shall be sufficient to prove that the envelope
containing such notice was properly addressed and delivered to the address
shown thereon or that the facsimile transmission was made and a facsimile
confirmation report was received, as the case may be.
20. SEVERABILITY
If any provision of this Agreement is held by a court of competent
jurisdiction to be illegal, invalid or unenforceable in any respect under the
law of any jurisdiction, then such provision shall (so far as it is invalid
or unenforceable) be given no effect and shall be deemed not to be included
in this Agreement but without invalidating any of the remaining provisions of
this Agreement. 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. The parties shall then use all
reasonable endeavours to replace the invalid or unenforceable provision(s) by
a valid and enforceable substitute provision the effect of which is as close
as possible to the intended effect of the invalid or unenforceable provision.
21. COSTS
Without prejudice to its other rights pursuant to this Agreement (or any
relation to a breach by either party of the terms of this Agreement), each
party shall be responsible for its own legal, accountancy and other costs,
charges and expenses incurred in connection with negotiation, preparation,
execution and implementation of this Agreement and the Acquisition.
22. CONTRACTS (RIGHTS OF THIRD PARTIES) ACT 1999
The parties to this Agreement do not intend that any term of this Agreement
should be enforceable, by virtue of the Contracts (Rights of Third Parties)
▇▇▇ ▇▇▇▇, by any person who is not a party to this Agreement.
23. TIME OF THE ESSENCE
In respect of clauses 6 and 9.2 (but not in respect of the other clauses of
this Agreement), time shall be of the essence of this Agreement, both as
regards times, dates and periods specified in the agreement and as to any
times, dates or periods that may by agreement between the parties be
substituted for any of them.
24. ASSIGNMENT
None of the parties to this Agreement may assign this Agreement or any of its
rights hereunder without the prior written consent of the other parties (not
to be unreasonably withheld or delayed). Any purported assignment in breach
of this clause shall not confer any rights on the purported assignee.
25. DISPUTES
25.1 Governing Law
The construction, validity and performance of this Agreement shall be
governed by the laws of England.
25.2 Jurisdiction
Each party irrevocably agrees to submit to the exclusive jurisdiction of the
courts of England over any claim or matter arising under or in connection
with this Agreement.
IN WITNESS WHEREOF this Agreement has been executed by the Parties on the
date set out on the first page of this document.
SIGNED by )
duly authorised for and on behalf)
of UMBRO PLC )
SIGNED by )
duly authorised for and on behalf)
of NIKE VAPOR LIMITED )
SIGNED by )
duly authorised for and on behalf)
of NIKE, INC. )
SCHEDULE 1
Form of Press Announcement
SCHEDULE 2
Indicative Timetable
SCHEDULE 3
Form of General Meeting Resolutions
The following are draft resolutions to be proposed, substantially in the form
in which they appear below, subject to such modification, addition or
condition agreed between Umbro, Nike and Nike Vapor, at the General Meeting:
SPECIAL RESOLUTION
THAT: for the purpose of giving effect to the scheme of arrangement dated [?]
2007 between the Company and the holders of the Scheme Shares (as defined in
the said scheme), a print of which has been produced to this meeting and for
the purposes of identification signed by the Chairman hereof, in its original
form or subject to such modification, addition or condition agreed between
the Company, Nike, Inc. and Nike Vapor Ltd and approved or imposed by the
Court (the ??Scheme??):
(a) the directors of the Company be authorised to take all such action as
they may consider necessary or appropriate for carrying the Scheme into
effect;
(b) the share capital of the Company be reduced by cancelling and
extinguishing all of the Scheme Shares (as defined in the Scheme);
(c) subject to and forthwith upon the reduction of share capital referred
to in paragraph (b) above taking effect and notwithstanding anything to the
contrary in the articles of association of the Company:
(i) the share capital of the Company be increased to its former amount by
the creation of such number of new ordinary shares of 1 ▇▇▇▇▇ each as shall
be equal to the aggregate number of Scheme Shares cancelled pursuant to
paragraph (b) above;
(ii) the reserve arising in the books of account of the Company as a result
of the reduction of share capital referred to in paragraph (b) above be
capitalised and applied in paying up in full at par all of the new ordinary
shares created pursuant to paragraph (c)(i) above, which shall be allotted
and issued, credited as fully paid, to Nike Vapor Ltd and/or its nominee(s)
in accordance with the Scheme; and
(iii) conditional upon the Scheme becoming effective, the directors of the
Company be and they are hereby generally and unconditionally authorised for
the purposes of section 80 of the Companies ▇▇▇ ▇▇▇▇ to allot the new
ordinary shares referred to in paragraph (c)(i) above, provided that: (1) the
maximum aggregate nominal amount of relevant securities that may be allotted
under this authority shall be the aggregate nominal amount of the said new
ordinary shares created pursuant to sub-paragraph (c)(i) above; (2) this
authority shall expire (unless previously revoked, varied or renewed) on [31
August] 2008; and (3) this authority shall be in addition, and without
prejudice, to any other authority under the said section 80 previously
granted and in force on the date on which this resolution is passed; and
(d) with effect from the passing of this resolution, the articles of
association of the Company be amended by including the following new article
after article [?] (and amending the remainder of the articles and any cross-
references thereto accordingly):
??[?] Scheme of Arrangement
(A) In this Article [?] references to the ??Scheme?? are to the scheme of
arrangement dated [?] 2007 under section 425 of the Companies ▇▇▇ ▇▇▇▇
between the Company and the holders of Scheme Shares (as defined in the
Scheme) as it may be modified or amended in accordance with its terms, and
expressions defined in the Scheme will have the same meanings in this
Article.
(B) Notwithstanding any other provision of these Articles, if any ordinary
shares are issued to any person (the ??New Member??) after the Scheme Record
Time, such New Member (or any subsequent holder or any nominee of such New
Member or any such subsequent holder) will, provided the Scheme has become
effective, be obliged to transfer all the ordinary shares held by the New
Member (or any subsequent holder or any nominee of such New Member or any
such subsequent holder) (the ??Disposal Shares??) to Nike Vapor Ltd (or as
Nike Vapor Ltd may otherwise direct) (the ??Purchaser??) who shall be obliged
to acquire all of the Disposal Shares. The consideration payable by the
Purchaser shall be [?] ▇▇▇▇▇ in cash for each Disposal Share transferred to
it (or such lesser or greater amount as may be payable under the Scheme if
modified in accordance with its terms).
(C) On any reorganisation of, or material alteration to, the share capital
of the Company (including, without limitation, any subdivision and/or
consolidation), the value of the consideration per Disposal Share to be paid
under Article [?](B) shall be adjusted by the directors in such manner as an
independent investment bank selected by the Company may determine to be fair
and reasonable to the New Member to reflect such reorganisation or
alteration. References in this Article to ordinary shares shall, following
such adjustment, be construed accordingly.
(D) Any New Member may, prior to the issue or transfer of any Disposal
Shares to him or her under one of the Company?s employee share schemes, give
no less than [two] Business Day?s written notice to the Company of his or her
intention to transfer some or all of such Disposal Shares to his or her
spouse or civil partner and may, if such notice has been validly given, on
such Disposal Shares being issued to him or her immediately transfer to his
or her spouse or civil partner any such Disposal Shares, provided that such
Disposal Shares will then be immediately transferred from that spouse or
civil partner to Nike Vapor Ltd pursuant to Article [?](B) above as if the
spouse or civil partner were the relevant New Member.
(E) To give effect to any transfer required by Article [?](B) above, the
Company may appoint any person as attorney for the New Member to execute and
deliver as transferor a form of transfer or instructions of transfer on
behalf of the New Member (or any subsequent holder or any nominee of such New
Member or any such subsequent holder) in favour of the Purchaser and do all
such other things and execute and deliver all such documents as may in the
opinion of the attorney be necessary or desirable to vest the Disposal Shares
in the Purchaser and pending such vesting to exercise all such rights to the
Disposal Shares as the Purchaser may direct. If an attorney is so approved,
the New Member shall not thereafter (except to the extent that the attorney
fails to act in accordance with the directions of the Purchaser) be entitled
to exercise any rights attaching to the Disposal Shares unless so agreed by
the Purchaser. The Company may give good receipt for the purchase price of
the Disposal Shares and may register the Purchaser as holder thereof and
issue to it certificates for the same. The Company shall not be obliged to
issue a certificate to the New Member for any Disposal Shares. The Purchaser
shall send a cheque drawn on a UK clearing bank in favour of the New Member
(or any subsequent holder or any nominee of such New Member or any such
subsequent holder) for the purchase price of such Disposal Shares within 14
days of the date on which the Disposal Shares are issued to the New Member.
(F) if the Scheme shall not have become effective by the date referred to
in clause 5 of the Scheme, (or such later date, if any, as Nike Vapor Ltd and
the Company may agree and the Court may allow) this Article [?] shall be of
no effect.
(G) Notwithstanding any other provision of the Articles, both the Company
and the Directors shall refuse to register the transfer of any Scheme Shares
effected between the Scheme Record Time and the Effective Date.??
SCHEDULE 4
The Resolutions
RESOLVED that, subject to Umbro plc, Nike Vapor and Nike, Inc. entering into
the proposed Implementation Agreement regarding an offer for the entire
issued and to be issued share capital of Umbro plc, the Remuneration
Committee will not use its discretion under the rules of the Umbro Long Term
Incentive Plan 2004 (the ?Plan?) or any other such discretion it may have
under any other Plan documents to waive, vary or substitute the performance
conditions or such other conditions of exercise to which any outstanding
awards made under the Plan are subject.
RESOLVED that the Remuneration Committee will reconsider the exercise of its
discretion only if the Implementation Agreement terminates.
RESOLVED that, subject to the Acquisition (as defined in the Implementation
Agreement) being successfully completed the performance targets for options
granted under the Plan are satisfied as follows:
2005 grant 0
2006 grant 40%
2007 grant 100%
and that the schedule attached as Appendix 1 be and is hereby approved.
APPENDIX 1
Amounts to be Paid Out under the Umbro Long Term Incentive Plan 2004