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Section 1: 8-K (8-K)

8-K

 

 

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

 

 

FORM 8-K

 

 

CURRENT REPORT

Pursuant to Section 13 or 15(d)

of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): August 6, 2016

 

 

AMPLIFY SNACK BRANDS, INC.

(Exact name of Registrant as Specified in Its Charter)

 

 

 

Delaware   001-37530   47-1254894
(State or Other Jurisdiction
of Incorporation)
  (Commission
File Number)
  (IRS Employer
Identification No.)

 

500 West 5th Street, Suite 1350

Austin, Texas

  78701
(Address of Principal Executive Offices)   (Zip Code)

Registrant’s Telephone Number, Including Area Code: 512.600.9893

N/A

(Former Name or Former Address, if Changed Since Last Report)

 

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instructions A.2. below):

 

¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

 

¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

 

¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

 

¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

 

 


Item 1.01. Entry into a Material Definitive Agreement.

On August 6, 2016, Thunderball Bidco Limited (the “Purchaser”), a direct, wholly-owned subsidiary of Amplify Snack Brands, Inc. (the “Company”) and SkinnyPop Popcorn LLC, a direct wholly-owned subsidiary of the Company (the “Purchaser Guarantor”) entered into a Share Purchase Agreement (the “Purchase Agreement”) with Crisps Holdings Limited, a company incorporated under the laws of the Cayman Islands (the “Institutional Seller”) and individual selling equityholders (the “Management Sellers”) pursuant to which Purchaser will purchase all of the outstanding equity interests of Crisps Topco Limited (“Crisps”), a company incorporated under the laws of England and Wales, which owns the Tyrrells international portfolio of premium snack brands (the “Transaction”).

In connection with the entry into the Purchase Agreement, the Purchaser also entered into a Warranty Deed with individual warrantors (the “Warrantors”) relating to the Transaction (the “Warranty Deed”), pursuant to which the Warrantors have agreed to provide certain representations and warranties to the Purchaser. The Warranty Deed contemplates that the Company will obtain representation and warranty insurance at the closing of the Transaction in order to mitigate a portion of its exposure with respect to representations and warranties made by the Warrantors.

Pursuant to the Purchase Agreement, and subject to the terms and conditions contained therein, at the closing of the Transaction, Purchaser will acquire all of the outstanding equity interests of Crisps at an enterprise value of £300 million, comprising of approximately £278 million of cash and approximately 2.1 million shares of the Company’s common stock. The cash consideration payable is subject to certain potential adjustments between signing and closing as described in the Purchase Agreement. The share consideration payable is fixed based upon the closing price of the Company’s common stock on the New York Stock Exchange on August 5, 2016 and a pound sterling (£) to U.S. Dollar ($) exchange rate of 1.3042. There is no fixed exchange rate for the cash consideration payable. The Company has entered into foreign currency hedging arrangements for the majority of the cash consideration component.

The closing of the Transaction is subject to the satisfaction or waiver of customary closing conditions, including the expiration or termination of any waiting periods applicable to the Transaction, including applicable antitrust and competition laws. The closing of the Transaction is not subject to a financing condition.

The parties to the Purchase Agreement and the Warranty Deed have made customary representations, warranties and covenants including a covenant by the Management Sellers to operate Crisps and its subsidiaries in the ordinary course of business consistent with past practices until the closing of the Transaction.

The Purchase Agreement provides that the Purchaser Guarantor guarantees the obligations of the Purchaser under the Purchase Agreement, including the payment when due of all amounts payable by the Purchaser under the Purchase Agreement.

The Purchase Agreement provides that if appropriate approval under applicable antitrust and competition laws is not obtained by November 7, 2016, or if the parties agree that such approval is incapable of satisfaction on or before such date, the Purchase Agreement shall automatically terminate. In addition, either party has the right to terminate the Purchase Agreement upon notice to the other party if the other party fails to comply with its respective closing condition obligations under the Purchase Agreement.

The Purchase Agreement contemplates that at the closing of the Transaction, the Institutional Seller and each of the Management Sellers will enter into a contractual lock-up agreement with the Company, pursuant to which the Institutional Seller and each of the Management Sellers will agree not to make any sale or other transfer of any shares of the Company’s common stock for a period of six months following closing of the Transaction, subject to certain customary exceptions. The Purchase Agreement also contemplates that at the closing of the Transaction, the Company and the requisite existing parties thereto will amend the Company’s existing Registration Rights Agreement dated as of August 10, 2015, in order to add the Institutional Seller and certain of the Management Sellers as parties thereto.

In connection with the execution of the Purchase Agreement, on August 6, 2016, the Company entered into a commitment letter with Jefferies Finance LLC, Credit Suisse AG, Credit Suisse Securities (USA) LLC and Goldman Sachs Bank USA (together with their designated affiliates, the “Commitment Parties”), pursuant to which the Commitment Parties have committed to provide a term loan facility (the “Term Loan Facility”) in an aggregate


amount of $600 million and a revolving loan facility in an aggregate amount of $50 million (the “Revolving Loan Facility” and, together with the Term Loan Facility, the “Debt Facilities”). The commitments of the Commitment Parties to provide the Debt Facilities are subject to customary conditions, including the consummation of the Transaction, the execution and delivery of definitive documentation, the accuracy of certain specified representations and other customary closing conditions.

Subject to and in connection with the Transaction, and subject to the approval of the Compensation Committee of the Board of Directors of the Company, the Company intends to grant to certain of the employees of Crisps and its subsidiaries, restricted stock unit awards covering approximately 1.2 million shares of the Company’s common stock upon the closing of the Transaction, with such restricted stock unit awards being subject to vesting based on service conditions. The restricted stock unit awards will be issued under and in accordance with the Company’s 2015 Stock Option and Incentive Plan.

Subject to and in connection with the Transaction, the Company intends to appoint David Milner, the current Chief Executive Officer of Crisps, as the Company’s International President, Executive Vice President, effective as of the closing of the Transaction. It is currently anticipated that the Company will enter into an employment agreement with Mr. Milner at the closing of the Transaction reflecting his employment relationship. The Company currently anticipates that Mr. Milner will become an executive officer of the Company, and to the extent required, the Company will report the information required by Item 5.02(c) of Form 8-K upon the closing of the Transaction and upon Mr. Milner’s appointment as an executive officer of the Company.

The descriptions of the Purchase Agreement and the Warranty Deed contained in this Item 1.01 are qualified in their entirety by the Purchase Agreement and the Warranty Deed filed as Exhibits 2.1 and 2.2 hereto. The foregoing summaries and this Current Report on Form 8-K are not intended to modify or supplement any factual disclosures about the Company in its public reports filed with the Securities and Exchange Commission. The assertions embodied in the representations and warranties contained in the Purchase Agreement and the Warranty Deed were made solely for purposes of the Purchase Agreement and the Warranty Deed, and may be subject to important qualifications and limitations agreed to by the parties to the Purchase Agreement and the Warranty Deed in connection with negotiating their terms. In particular, in reviewing the representations and warranties contained in the Purchase Agreement and the Warranty Deed, it is important to bear in mind that the representations and warranties were made solely for the benefit of the parties to the Purchase Agreement and the Warranty Deed and have been negotiated with the principal purpose of allocating risk between the parties rather than to establish matters as facts. The Purchase Agreement, the Warranty Deed, and the respective representations and warranties contained therein, and the foregoing descriptions of the Purchase Agreement and the Warranty Deed should not be relied upon as a disclosure of factual information relating to the Company or Crisps. The representations and warranties may also be subject to a contractual standard of materiality different from those generally applicable to investors and reports and documents filed with the Securities and Exchange Commission and in some cases may be qualified by disclosures made by one party to the other which are not necessarily reflected in the Purchase Agreement or the Warranty Deed, among other limitations.

Item 2.02. Results of Operations and Financial Condition

On August 8, 2016, the Company issued a press release announcing its results for the quarter ended June 30, 2016. A copy of the press release is attached as Exhibit 99.1 to this Current Report on Form 8-K and is incorporated by reference herein. The information in this Item 2.02 (including Exhibit 99.1) is being furnished and shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended (the “Securities Act”) or the Exchange Act, regardless of any general incorporation language in such filing.


Item 3.02. Unregistered Sales of Equity Securities.

The information included under Item 1.01 of this Current Report on Form 8-K is incorporated herein by reference. The issuance of the Company’s common stock to the Institutional Seller and the Management Sellers pursuant to the Purchase Agreement is expected to be made in reliance on the private placement exemption from the registration requirements of the Securities Act of 1933, as amended, provided by Section 4(a)(2) thereof or Rule 506 of Regulation D promulgated thereunder. The Company will rely on this exemption from registration based in part on representations made by the Institutional Seller and the Management Sellers in the Purchase Agreement. The Company’s common stock to be issued will contain appropriate restricted stock legends.

Item 7.01. Regulation FD Disclosure

On August 8, 2016, the Company issued a press release announcing the entering into of the Purchase Agreement in connection with the Transaction described above in the disclosure under Item 1.01 of this Current Report on Form 8-K. The press release is attached hereto as Exhibit 99.2 and is incorporated herein by reference.

On August 8, 2016, the Company will be making the information furnished herewith as Exhibit 99.3 available to potential lenders for the purpose of obtaining a term loan facility in an aggregate amount of $600 million and a revolving loan facility in an aggregate amount of $50 million, the proceeds of which would be used to finance a portion of the above announced Transaction. The information contained in Exhibit 99.3 is incorporated herein by reference.

As provided in General Instruction B.2 of Form 8-K, the information and exhibits contained in, or referred to in, this Item 7.01 of this Current Report on Form 8-K (including each of Exhibits 99.2 and 99.3 attached hereto) are being furnished and shall not be deemed to be “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, nor shall they be deemed to be incorporated by reference in any filing under the Securities Act of 1933, as amended, except as shall be expressly set forth by specific reference in such a filing.

Forward-Looking Statements

This Current Report on Form 8-K contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 (the “PSLRA”) and other federal securities laws. Any statements contained herein which do not describe historical facts, including but not limited to, statements regarding the proposed Transaction, including the consideration to be paid and the terms and conditions thereof, and the other transactions contemplated by the Purchase Agreement and the Warranty Deed and the Company’s expectations regarding the financing and the Commitment Letter, are forward-looking statements which involve risks and uncertainties that could cause actual results to differ materially from those discussed in such forward-looking statements. Statements about the Company’s or Crisps Topco Limited’s past financial results do not, and are not meant to, predict future results. The Company can provide no assurance that such results and performance will continue. For the avoidance of doubt, any statements in this report that relate to the Transaction are forward-looking statements within the meaning of the PSLRA and other federal securities laws. Such risks and uncertainties include, among others, (1) the possibility that the closing conditions set forth in the Purchase Agreement, including those conditions related to antitrust and competition law clearance, will not be met and that the parties will be unable to consummate the proposed Transaction, (2) the chance that, despite having a commitment in place, the Company will be unable to secure financing, or financing on satisfactory or anticipated terms, in amounts sufficient to consummate the Transaction, (3) the possibility that, if the Transaction is consummated, the Company may not realize the expected benefits, synergies and opportunities anticipated in connection with the Transaction, including that the Transaction will further diversify the Company’s net sales and be accretive to the Company’s 2017 and 2018 diluted earnings per share, (4) the challenges of integrating Crisps Topco Limited and subsidiaries into the Company’s organization, as well as the Company’s ability to retain key talent from Crisps Topco Limited and subsidiaries and the resulting disruptions to the Company’s and Crisps Topco Limited’s operations if it fails to do so, and (5) such other risks identified in the Company’s Securities and Exchange Commission (the “SEC”) filings, including the Company’s Annual Report on Form 10-K for the year ended December 31, 2015 and our Quarterly Report on Form 10-Q for the quarter ended March 31, 2016 and subsequent filings with the SEC. The Company cautions you not to place undue reliance on any forward-looking statements, which speak only as of the date they are made. The Company disclaims any obligation to publicly update or revise any such statements to reflect any change in expectations or in events, conditions or circumstances on which any such statements may be based, or that may affect the likelihood that actual results will differ from those set forth in the forward-looking statements.


Item 9.01 Financial Statements and Exhibits.

(d) Exhibits

 

Exhibit
No.

  

Description

  2.1*    Share Purchase Agreement by and among Crisps Holdings Limited, individual selling equityholders, Thunderball Bidco Limited and SkinnyPop Popcorn LLC, dated August 6, 2016.
  2.2*    Warranty Deed Relating to the Sale and Purchase of Crisps Topco Limited, by and among certain individual warrantors and Thunderball Bidco Limited, dated August 6, 2016.
99.1    Press Release, dated August 8, 2016, issued by Amplify Snack Brands, Inc. (regarding the Company’s preliminary earnings results)
99.2    Press Release, dated August 8, 2016, issued by Amplify Snack Brands, Inc. (regarding the announcement of the Transaction)
99.3    Public Lender Presentation dated August 8, 2016

 

* Pursuant to Item 601(b)(2) of Regulation S-K, certain exhibits and schedules to this agreement have been omitted. The Company hereby agrees to furnish a supplemental copy of any or all of such omitted exhibits or schedules to the Securities and Exchange Commission, upon its request.


SIGNATURES

Pursuant to the requirements of the Securities and Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

 

Amplify Snack Brands, Inc.
(Registrant)
By:  

/s/ Brian Goldberg

  Brian Goldberg
  Chief Financial Officer

August 8, 2016


Exhibit Index

 

Exhibit
No.

  

Description

  2.1*    Share Purchase Agreement by and among Crisps Holdings Limited, individual selling equityholders, Thunderball Bidco Limited and SkinnyPop Popcorn LLC, dated August 6, 2016.
  2.2*    Warranty Deed Relating to the Sale and Purchase of Crisps Topco Limited, by and among certain individual warrantors and Thunderball Bidco Limited, dated August 6, 2016.
99.1    Press Release, dated August 8, 2016, issued by Amplify Snack Brands, Inc. (regarding the Company’s preliminary earnings results)
99.2    Press Release, dated August 8, 2016, issued by Amplify Snack Brands, Inc. (regarding the announcement of the Transaction)
99.3    Public Lender Presentation dated August 8, 2016

 

* Pursuant to Item 601(b)(2) of Regulation S-K, certain exhibits and schedules to this agreement have been omitted. The Company hereby agrees to furnish a supplemental copy of any or all of such omitted exhibits or schedules to the Securities and Exchange Commission, upon its request.
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Section 2: EX-2.1 (EX-2.1)

EX-2.1

Exhibit 2.1

Dated 6 August 2016

CRISPS HOLDINGS LIMITED

- and -

THE MANAGEMENT SELLERS

- and -

THE PURCHASER

- and -

THE PURCHASER’S GUARANTOR

 

 

SHARE PURCHASE AGREEMENT

relating to the sale and purchase of

CRISPS TOPCO LIMITED

 

 


Table of Contents

 

         Page  
1.  

DEFINITIONS AND INTERPRETATION

     1   
2.  

SALE AND PURCHASE

     15   
3.  

CONSIDERATION AND ROLLOVER

     15   
4.  

CONDITION PRECEDENT

     16   
5.  

PRE-COMPLETION UNDERTAKINGS

     18   
6.  

COMPLETION

     24   
7.  

LEAKAGE

     27   
8.  

SELLERS’ WARRANTIES AND UNDERTAKINGS

     27   
9.  

LIMITATIONS ON SELLER LIABILITY

     29   
10.  

PURCHASER’S AND PURCHASER’S GUARANTOR’S WARRANTIES AND UNDERTAKINGS

     30   
11.  

RELEASE BY THE SELLERS

     31   
12.  

CONFIDENTIALITY

     31   
13.  

ANNOUNCEMENTS

     33   
14.  

GUARANTEE BY PURCHASER’S GUARANTOR

     33   
15.  

NOTICES

     34   
16.  

FURTHER ASSURANCES

     37   
17.  

POST COMPLETION UNDERTAKINGS

     37   
18.  

ASSIGNMENTS

     39   
19.  

PAYMENTS

     39   
20.  

GROSS UP

     40   
21.  

GENERAL

     40   
22.  

WHOLE AGREEMENT

     42   
23.  

MANAGEMENT REPRESENTATIVES

     42   
24.  

SERVICE OF PROCESS

     43   
25.  

GOVERNING LAW AND JURISDICTION

     44   

 

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SCHEDULE 1 THE MANAGEMENT SELLERS

     46   

SCHEDULE 2 COMPLETION

     47   

Agreed Form documents

Announcement

Power of Attorney

Deed of Termination

Direction Letters

Institutional Director Resignation Letter

Lost certificate indemnity

Lock-Up Agreement

Amendment to the Registration Rights Agreement

Service Agreements

Business Plan

US Transfer Agreement

RSU Term Sheets

 

ii


THIS AGREEMENT is made on 6 August 2016 (the “Agreement”)

BETWEEN:

(1) CRISPS HOLDINGS LIMITED, a company incorporated under the laws of the Cayman Islands with registered number 279430, whose registered office is at Boundary Hall, Cricket Square, PO Box 1111, Grand Cayman KY11 – 1102, Cayman Islands (the “Institutional Seller”);

(2) THE PERSONS whose names and addresses are set out in Schedule 1 (each a “Management Seller” and together the “Management Sellers”);

(3) THUNDERBALL BIDCO LIMITED (registered number 10309824) whose registered office is at 20-22 Bedford Row, London, WC1R 4JS (the “Purchaser”); and

(4) SKINNYPOP POPCORN LLC, a Delaware limited liability company (the “Purchaser’s Guarantor”).

BACKGROUND:

(A) The Sellers have agreed to sell the Securities held by them and the Purchaser has agreed to purchase such Securities on the terms, and subject to the conditions, set out in this Agreement.

(B) The Purchaser’s Guarantor is willing to guarantee the obligations of the Purchaser under this Agreement.

IT IS AGREED as follows:

1. DEFINITIONS AND INTERPRETATION

Amplify” means Amplify Snack Brands, Inc., an Affiliate of the Purchaser and the Purchaser’s Guarantor;

A Ordinary Shares” means the A ordinary shares of £0.01 each in the share capital of the Company set out opposite the name of each Seller in column (7) of the Master Allocation Schedule;

Affiliate” means (i) in relation to any person means any natural person or legal entity who or which, directly or indirectly, controls, or is controlled by, or is under common control with such person or entity, and “control” (together with its correlative meanings, “controlled by” and “under common control with”) means with respect to any other person or entity, the possession, directly or indirectly, of power to direct or cause the direction of management or policies of such person or entity (whether through ownership of voting securities or partnership or other ownership interests, by contract or otherwise); (ii) in relation to any Fund, any adviser, nominee, manager, administrator, trustee, general partner or limited partner to or of that Fund or to or of any group undertaking of that Fund or any investor in any of them; (iii) any co-investment scheme of such person or Fund referred to in (i) and (ii) or any group undertaking of that person or Fund any person holding shares under such scheme or entitled to the benefit of share under such scheme; and (iv) any employee, officer, director, partner or professional adviser of that person or Fund;

 

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Agent” means the agent of the lenders under the Existing Facilities from time to time;

Agreed Form” means, in relation to any document, the form of that document which has been identified by or on behalf of the Institutional Seller, the Management Representative and the Purchaser with such changes as the Institutional Seller, the Management Representative and Purchaser may agree in writing before Completion;

Allotment Allocation Loans” means the loans (not exceeding a principal amount of £47,256.12 in aggregate) to be advanced by the Company to David Milner, Joanne Jones, Michael Hedges, Stuart Telford, Janice Bennett and Brendan Harris to subscribe for 9,210 B Ordinary Shares to be issued by the Company;

Announcement” means the press announcement concerning the Transaction in the Agreed Form;

Anti-Trust Condition” means the FCO having cleared the proposed transaction. This condition precedent shall be deemed satisfied if:

(a) the FCO notifies the Purchaser and/or the Institutional Seller within the one-month period under Sec. 40 para. 1 clause 1 of the German Act Against Restraints of Competition (“GWB”) that the conditions for a prohibition according to Sec. 36 para. 1 GWB are not met;

(b) the FCO fails to notify the Purchaser and/or the Institutional Seller within the one-month period under Sec. 40 para. 1 clause 1 GWB that it has initiated an in-depth review (Hauptpruefverfahren) of the proposed transaction;

(c) the FCO clears the Transaction unconditionally or on conditions (it being understood that the Purchaser shall only be obliged to agree to conditions satisfactory to the Purchaser in its reasonable discretion) in the main proceedings (Hauptpruefverfahren); or

(d) the FCO fails to issue a decision in accordance with Sec. 40 para. 2 clause 1 GWB to the Purchaser and/or the Institutional Seller within the four-month period under Sec. 40 para. 2 clause 2 GWB.

Articles of Association” means the articles of association of the Company;

Associate” means, in relation to any person, a person who is connected with that person or a person in which that person and/or its connected persons beneficially owns or controls directly or indirectly, 20% or more of the voting rights or economic interest;

Australian Acquisition” means the completion of the acquisition of the entire issued share capital of Yarra Valley Snack Foods Pty Limited by Tyrrells Crisps Holdings (Australia) Pty Limited pursuant to the share sale agreement dated 30 July 2015;

B Ordinary Shares” means the B ordinary shares of £0.01 each in the share capital of the Company set out opposite the name of each Seller in column (8) of the Master Allocation Schedule;

Bolt-on Transaction Costs” has the meaning given to it in paragraph (r) of the definition of Permitted Leakage;

 

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Books and Records” has its common law meaning and includes all notices, correspondence, orders, inquiries, drawings, plans, books of account and other documents and all computer disks or tapes or other machine legible programs or other records (excluding software);

Business Day” means a day (other than a Saturday or Sunday or public holiday) on which banks are generally open in London and New York for normal business;

Business Plan” means the business plan of the Group in the Agreed Form;

C Ordinary Shares” means the C ordinary shares of £250.00 each in the share capital of the Company set out opposite the name of each Seller in column (9) of the Master Allocation Schedule;

Commitment Letter” means the commitment letter entered into between Jefferies Finance LLC, Credit Suisse Securities (USA) LLC, Credit Suisse AG, Cayman Islands Branch, Goldman Sachs Bank USA and Amplify dated on or about the date hereof (together with all exhibits thereto and as amended or otherwise modified from time to time); provided Amplify shall not permit any amendment or modification to be made to, or any waiver of any provision under, the Commitment Letter, if such amendment, modification or waiver (i) would reduce the aggregate amount of the debt financing, (ii) would materially adversely affect the ability of Amplify to enforce its rights against the other parties to the Commitment Letter or any definitive agreements with respect to the debt financing, or (iii) would impose new or additional conditions or otherwise amend, modify or expand any of the conditions to the receipt of the debt financing; provided, further, nothing herein shall prevent Amplify from amending the Commitment Letter to add lenders, lead arrangers, bookrunners, syndication agents or other similar entities who had not executed the Commitment Letter as of the date of this Agreement;

Company” means Crisps Topco Limited, a company incorporated in England and Wales with registered number 08609893;

Completion” means completion of the sale and purchase of the Securities in accordance with this Agreement;

Completion Date” means the date on which Completion occurs;

Confidentiality Agreement” means the confidentiality agreement entered into between Amplify and Investcorp Securities Limited dated 30 May 2016;

Consideration” has the meaning set out in clause 3.1;

Data Room” has the meaning given to it in the Management Warranty Deed;

Deed of Termination” means the deed of termination in the Agreed Form in relation to the termination of the Investment Agreement;

Deferred Shares” means (i) the deferred share of £1.00 in the share capital of the Company and (ii) the deferred shares of £0.01 each in the share capital of the Company, in each case as set out opposite the name of the Sellers in columns (10) and (11) of the Master Allocation Schedule;

 

3


Deferral Process” means the redesignation of 177,425 A Ordinary Shares into Deferred Shares in accordance with Article 8 of the Articles of Association;

Direction Letters” means the letters in the Agreed Form addressed to the Purchaser in respect of the application of certain of the Consideration due in repayment of the Manager Loans and the Investor Loan;

Disclosed” has the meaning given to it in the Management Warranty Deed;

Disclosure Letter” means the disclosure letter dated on or about the date of this Agreement in connection with the Management Warranty Deed;

Electronic Communication” means an electronic communication as defined in the Electronic Communications Act 2000;

Emergency Situation” means a situation which (i) is an emergency or disaster, and (ii) has or could reasonably be expected to have a material adverse effect on the Group;

Employee” means an individual who has entered into or works under a contract of employment with any Group Company and also includes any director or other officer of any Group Company whether or not he has entered into or works or worked under a contract of employment with any Group Company;

Encumbrance” means any interest or equity of any person or any mortgage, charge (fixed or floating), pledge, lien, option, right to acquire, right of pre-emption, restriction on transfer, assignment by way of security or trust arrangement for the purpose of providing security or other security interest of any kind (including any retention arrangement), or any agreement, arrangement or obligation (including any conditional obligation) to create any of the foregoing;

Exchange Rate” means in relation to any currency to be converted into or from British pound sterling on a particular day for the purposes of this Agreement, the spot rate of exchange (the closing mid-point) for that currency into or, as the case may be, from British pound sterling on the Business Day before such particular day as published in the London edition of The Financial Times first published thereafter or, where no such rate of exchange is published in respect of the Business Day before such particular day, at the rate quoted by www.oanda.com as at the close of business in London on such Business Day;

Existing Facilities” means the Senior Facility Agreement and the Intercompany Loan Agreement;

External Debt Repayment Amount” means all amounts due and owing to the Finance Parties (as defined in the Senior Facility Agreement) including all unpaid interest accruing to (and including) the date of Completion and all sums becoming due and payable on Completion, including any break costs, hedging termination costs, premium or similar payment and any fees payable to any advisers to the lenders under the Senior Facility Agreement in connection with such repayment;

FCO” means the Federal Cartel Office of Germany;

Final Master Allocation Schedule” means an updated version of the Master Allocation Schedule (the version of which is correct as at the date of Completion and has been signed by

 

4


or on behalf of the Institutional Seller, the Management Representatives and the Purchaser for the purposes of identification on the date of Completion) prepared by the Institutional Seller (and agreed with the Management Representatives) which reflects the final breakdown of the Consideration between the Sellers as at Completion;

Financing Sources” means the agents, arrangers, lenders and other entities that commit to provide or arrange or otherwise enter into agreements in connection with all or any portion of the debt financing, including parties to the Commitment Letter and to any credit agreement or other definitive documentation entered into in connection with the debt financing, together with their respective Affiliates and their respective successors and assigns;

Fund” means any unit trust, investment trust, limited partnership, general partnership or their collective investment scheme or body corporate or other entity, in each case, the assets of which are managed professionally for investment purposes;

German Acquisition” means the completion of the acquisition of the limited partnership interest in Aroma Snacks GmbH & Co KG and the entire registered share capital of Aroma Verwaltungs-GmbH by heptus 237. GmbH with Tyrrells Group Holdings Limited as guarantor pursuant to the sale and purchase agreement dated 22 December 2015;

German Real Estate Filing” has the meaning given to it in clause 5.7;

Government Authority” means any governmental or regulatory body (whether in the United Kingdom or otherwise);

Group” means, together, the Company and the Subsidiaries;

Group Companies” means the Company and the Subsidiaries and “Group Company” means any of them;

holding company” has the meaning given in section 1159 of the Companies Act 2006;

Institutional Directors” means Hazem Ben-Gacem and Carsten Hagenbucher;

Institutional Seller’s Group” means, in relation to the Institutional Seller:

(a) any Affiliate of such Institutional Seller, or any fund managed and/or advised by any adviser or manager of such Institutional Seller and/or any of its Affiliates or any investor or potential investor in or director, employee or partner of any of them;

(b) any general partner, limited partner, trustee, nominee, operator, arranger of, manager of, or investment adviser to, such Institutional Seller or of or to any Affiliate of such Institutional Seller, or of or to any fund managed and/or advised by any investment adviser or manager of such Institutional Seller and/or any of its Affiliates;

(c) any scheme under which certain officers, employees or partners of the Institutional Seller, or of any of its investment advisers or managers, or of any Affiliates of such investment advisers or managers, are entitled (as individuals or through a body corporate or any other vehicle) to acquire shares in companies in which such Institutional Seller also invests, or any person holding shares or other interests under such a scheme or entitled to the benefits of shares or other interests under such a scheme; or

(d) any person or entity for whom such Institutional Seller holds Shares as trustee or nominee or in any other capacity whatsoever, but shall not include any portfolio company of (a) such Institutional Seller; (b) such Institutional Seller’s Affiliates; or (c) of any Fund managed by and/or advised by any investment adviser or manager of such Institutional Seller and/or any of its Affiliates;

 

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Institutional Seller’s Permitted Assignee” means, in relation to the Institutional Seller, any Affiliate of such Institutional Seller, or any fund managed and/or advised by any adviser or manager of such Institutional Seller and/or any of its Affiliates but shall not include any portfolio company of (a) such Institutional Seller; (b) such Institutional Seller’s Affiliates; or (c) of any Fund managed by and/or advised by any investment adviser or manager of such Institutional Seller and/or any of its Affiliates;

Institutional Seller’s Solicitors” means Shearman & Sterling LLP of 9 Appold Street, London EC2A 2AP;

Intercompany Loan Agreement” means the shareholder loan agreement dated 1 August 2013 between the Institutional Seller (as lender) and the Company (as borrower);

Internal Debt Repayment Amount” means the sum of £2,000,000 together with all accrued by unpaid interest as at Completion (being the amount owing under the Intercompany Loan Agreement;

Investment Agreement” means the investment agreement dated 1 August 2013 (as amended or adhered to from time to time) between, among others, the Company, the Institutional Seller and the Management Sellers, relating to the governance of the Company, to be terminated on Completion;

Investor Loan” means the £107,401 loan (together with all accrued but unpaid interest as at Completion) advanced by the Company to the Institutional Seller;

Investor Loan Notes” means the £81,359,096 in nominal amount of 12% unsecured subordinated loan notes due 2023 issued by Crisps Midco 2 Limited as set out opposite the name of the Institutional Seller in column (1) of the Master Allocation Schedule;

Leakage” means:

(a) any dividend or distribution (in cash or in kind) declared, paid or made (whether actual or deemed) by or on behalf of a Group Company to any Seller or any of their Related Persons;

(b) any management, service or other charge, fee or other compensation or payments made (or future benefits granted) (including, for the avoidance of doubt, any payments in respect of the Loan Notes or under the Intercompany Loan Agreement) to or for the benefit of (or liabilities assumed, indemnified, guaranteed, secured, discharged or incurred for the benefit of) any Seller or any of their Related Persons by or on behalf of any Group Company;

(c) any share capital, loan capital or other securities of any Group Company being issued, redeemed, purchased or repaid, or any other return of capital or any interest thereon by or on behalf of any Group Company to, or for the benefit of, any Seller or any of their Related Persons;

 

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(d) the waiver, deferral, release or discount by or on behalf of any Group Company of any amount, liability or obligation or claim owed to such Group Company by any Seller or any of their Related Persons;

(e) the purchase by or on behalf of any Group Company from any Seller, or any of their Related Persons, of any assets (or interest in an asset), rights or other benefits;

(f) the transfer or gift by or on behalf of any Group Company to any Seller or any of their Related Persons of any assets (or interest in an asset), rights or other benefits;

(g) any change to the terms of the borrowings between any Group Company and any Seller or any of their Related Persons;

(h) any fees, costs, expenses and other payments (together with any applicable VAT or other Tax) incurred or paid by any Group Company in connection with the German Acquisition and the Australian Acquisition;

(i) any transaction between, on the one hand, any Group Company and, on the other hand, any Seller or any of their Related Persons other than on an arm’s length basis;

(j) the creation of any Encumbrance in favour of any Seller or any of their Related Persons over any interest in any assets (or interest in an asset), rights or other benefits of any Group Company;

(k) any payment by or on behalf of a Group Company of, or obligation on or on behalf of a Group Company to pay or incur, any costs, professional fees, expenses or success, loyalty, transaction, retention or sale bonuses to any person (including, but not limited to, any consulting, advisory, management fee, finder’s fee or other fees or commission) in connection with the transactions contemplated by this agreement or as result of Completion or any disposal of the Securities;

(l) any agreement or arrangement made or entered into by or on behalf of any Group Company to do or give effect to any matter referred to in (a) to (k) above; or

(m) any Tax payable by any Group Company as a consequence of or in connection with any matter referred to in (a) to (l) above, but does not include any Permitted Leakage;

Leaver Loans” means the loans of £23,089.31 advanced by the Company to the Institutional Seller in relation to the acquisition of B Ordinary Shares from various former employees of the Group;

Loan Note Cash Consideration” means the aggregate cash amount payable upon the sale of all the Investor Loan Notes (principal and accrued but unpaid interest at the date of Completion) held by the Sellers;

 

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Loan Note Redemption Amount” means the aggregate cash amount payable upon the redemption of all the Management Loan Notes (principal and accrued but unpaid interest at the date of Completion) held by the Management Sellers;

Loan Notes” means the Investor Loan Notes and the Management Loan Notes;

Locked Box Date” means 1 April 2016;

Lock-Up Agreement” means a “lock-up” agreement in the Agreed Form;

Long Stop Date” means the date falling three months after (and excluding) the date of this Agreement;

managed” means a bona fide relationship of management where the relevant managing person or entity is bona fide primarily responsible for the investment decisions made for the fund, trust or company or with respect to the managed party’s holding of investor instruments, regardless of whether the relationship is characterised by the managing person or entity and the managed party as a relationship of investment manager, investment adviser, trustee or agent and fund manager and managing shall be construed accordingly;

Management Loan Notes” means the £5,518,852.43 in nominal amount of 12% unsecured subordinated loan notes due 2023 issued by Crisps Midco 2 Limited as set out opposite the name of the Management Sellers in column (4) of the Master Allocation Schedule;

Management Representatives” means David Milner and Joanne Jones or such other persons as may be appointed in accordance with clause 23 and “Management Representative” shall be construed accordingly;

Management Warranties” means those warranties given by the Warrantors (as defined in the Management Warranty Deed) as set out in the Management Warranty Deed;

Management Warranty Deed” means the deed dated on or about the date of this Agreement setting out the Management Warranties and limitations thereon;

Management Sellers’ Solicitors” means Travers Smith LLP of 10 Snow Hill, London EC1A 2AL;

Manager Loans” means the director loans (together with all accrued but unpaid interest thereon) between (i) certain Management Sellers and the Company and (ii) one Management Seller and TPCL (including, for the avoidance of doubt, the Allotment Allocation Loans, the Transfer Allocation Loans and the Leaver Loans);

Master Allocation Schedule” means the schedule (the version of which correct as at the date of this Agreement and has been signed by or on behalf of the Institutional Seller, the Management Representatives and the Purchaser for the purposes of identification on the date of this Agreement) setting out, among other things, details of the holdings of Securities of the Sellers as they will be immediately prior to Completion and their respective entitlement to the Consideration;

 

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Permitted Leakage” means:

(a) any fees (including monitoring fees) paid or agreed to be paid or payable to the Institutional Seller or any member of an Institutional Seller’s Group (up to a maximum amount of £100,000 (including any VAT thereon));

(b) in relation to the Management Sellers: (i) the payments of base salary; (ii) the payments of accrued bonuses; (iii) the reimbursement of reasonable expenses properly incurred in the ordinary course of employment in accordance with past practice over the last twelve month period; and (iv) the provision of all other emoluments, bonuses, commissions, pensions and benefits, in each case, in accordance with the terms of their respective service contracts or the Group’s policies that have been Disclosed to the Purchaser prior to the date of this Agreement (up to a maximum amount of £3,000,000 in aggregate), and in each case, excluding any payments connected with the Transaction;

(c) any accrual of interest on the Loan Notes in accordance with their terms;

(d) any accrual of interest on the Manager Loans and the Investor Loan in accordance with their terms;

(e) the payment of the Sellers’ Transaction Expenses to the extent deducted from the Share Cash Consideration at Completion;

(f) the Transfer Allocation Loans, only to the extent they have been repaid on Completion;

(g) the Allotment Allocation Loans, only to the extent they have been repaid on Completion;

(h) the Leaver Loans, only to the extent they have been repaid on Completion;

(i) the Reserved Share Allocation;

(j) the Deferral Process;

(k) the payment to Peter Thornton the sum of £227,861.15 in respect of the acquisition of his A Ordinary Shares, B Ordinary Shares and Management Loan Notes upon his departure from the business;

(l) any payments made in connection with the German Real Estate Filing (subject to any professional fees, costs and expenses in relation to the German Real Estate Filing not exceeding £5,000);

(m) any payments made (in an amount not exceeding €1,798,000 in aggregate) to Aroma Snacks & Co KG and Jochen Krumm in respect of liabilities related to silent partnerships and penalties, grant repayments and outlet closures in connection with the German Acquisition;

(n) payment of deferred consideration in respect of the Australian Acquisition to Andrew Blain of an amount not exceeding AU$4,900,000;

 

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(o) payment of deferred consideration in respect of the German Acquisition to Jochen Krumm of an amount not exceeding €2,000,000;

(p) payments of any fees, costs and expenses in connection with the Australian Acquisition and the German Acquisition not exceeding AU$50,000 and €200,000 (respectively) (the “Bolt-on Transaction Costs”);

(q) any Leakage fully reimbursed to any Group Company by or on behalf of a Seller of any of its Related Persons before Completion;

(r) any payment made or matter undertaken at the written request of the Purchaser and acknowledged in writing by the Purchaser as Permitted Leakage; and

(s) any Tax payable by any Group Company in connection with any of (a) to (r) above;

Purchaser’s Group” means the Purchaser and its Affiliates or an undertaking which is, on or at any time after the date of this Agreement, a subsidiary undertaking or parent undertaking of the Purchaser or a subsidiary undertaking of a parent undertaking of the Purchaser and includes each Group Company after Completion;

Purchaser’s Solicitors” means Goodwin Procter (UK) LLP of Tower 42, 25 Old Broad Street, London EC2N 1HQ;

Related Persons” means:

(a) in the case of a person which is a body corporate and/or a Fund, (i) any subsidiary undertaking or parent undertaking of that person and any subsidiary undertaking of any such parent undertaking, (ii) any trustee or nominee acting on its behalf, in each case, from time to time, (iii) any Affiliate of that person or (iv) any Associate of that person; and

(b) in the case of a person which is an individual, (i) any spouse, sibling and/or their respective lineal descendants by blood or adoption, (ii) any person or person acting in its or their capacity as trustee or trustees of a trust of which such individual is the settlor, (iii) any body corporate controlled by that person, (iv) any other person acting for or on behalf of that person or (v) an Associate of that person, but provided always that, for the purposes of this Agreement, (i) no member of the Group shall be or shall be deemed to be a “Related Person” of any Seller and (ii) no Seller shall be deemed to be a “Related Person” of any other Seller solely as a result of them being holders of shares in the capital of the Company.

Reserved Share Allocation” means:

(a) the transfer of the legal and/or beneficial interest in 4,500 B Ordinary Shares from the Institutional Seller to the Management Sellers; and

(b) the issue and allotment of 9,210 B Ordinary Shares to the Management Sellers;

Rollover Loan Notes” means the unsecured loan notes in the Purchaser to be issued to the Rollover Managers pursuant to the terms of an instrument to be agreed between the Management Representatives and the Purchaser prior to Completion, as set out in Clause 3.2 of this Agreement;

 

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Rollover Managers” means David Milner, Joanne Jones, Michael Hedges, Stuart Telford and Janice Bennett;

RSU Term Sheets” means the term sheets in the Agreed Form setting out, amongst other things, the number of restricted stock units awarded by and in the capital of Amplify subject to the terms set out therein and the terms of the restricted stock award agreements in the Agreed Form, subject always to any amendments required to such documents to ensure compliance with applicable local laws;

Securities” means the Shares and the Investor Loan Notes;

Securities Act” has the meaning given to it in clause 8.3(d);

Sellers” means the Institutional Seller and the Management Sellers;

Sellers’ Transaction Expenses” means the bona fide fees, costs, expenses and other payments (together with any VAT or other Tax) payable by a Group Company in connection with the Transaction;

Sellers’ Transaction Expenses Amount” means an amount equal to the aggregate of the Sellers’ Transaction Expenses;

Sellers’ Warranties” means the statements set out in clause 8.1, and “Sellers’ Warranty” means one of them;

Senior Employee” has the meaning given to it in the Management Warranty Deed;

Senior Facility Agreement” means the senior facility agreement dated 1 August 2013 between, amongst others, Crisps Midco 1 Limited, Crisps Bidco Limited and Lloyds Bank Plc (as agent, security agent, arranger and lender) (as amended and restated on 18 November 2015 and as further amended on 15 March 2016 and 21 June 2016);

Share Cash Consideration” means an amount equal to the aggregate of:

(i) £243,306,205.29; plus

(ii) £12,136.87, being an amount paid to the Company by Janice Bennett in relation to the Reserved Share Allocation; plus

(iii) an amount equal to the aggregate of the Manager Loans and the Investor Loan (excluding the Leaver Loans, the Allotment Allocation Loans and the Transfer Allocation Loans); less

(iv) Internal Debt Repayment Amount; less

(v) Bolt-on Transaction Costs; less

(vi) Sellers’ Transaction Expenses Amount; less

 

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(vii) £227,861.15, being an amount equal to the amount of Permitted Leakage of paragraph (k) of that definition; less

(viii) Loan Note Cash Consideration; less

(ix) Loan Note Redemption Amount; less

(x) £22,000,000, being the aggregate value as at the date of this Agreement of the Share Equity Consideration and the shares in respect of which the Rollover Loan Notes will be issued under this Agreement;

Share Consideration” means the Share Cash Consideration and the Share Equity Consideration and the Rollover Loan Notes;

Share Equity Consideration” means 1,870,945 shares of common stock of Amplify (which number, for the avoidance of doubt, does not include the shares which the Rollover Managers would receive as a result of the rollover process set out in clause 3.2);

Shares” means the A Ordinary Shares, the B Ordinary Shares, the C Ordinary Shares and the Deferred Shares, being the entire share capital of the Company;

Subsidiaries” means all of the subsidiaries of the Company, and “Subsidiary” means any of them;

subsidiary” has the meaning given in section 1159 of the Companies Act 2006;

Tax” means any tax, and any duty, contribution, impost, levy or charge in the nature of tax, and any fine, penalty, surcharge or interest connected therewith, including (without prejudice to the foregoing) corporation tax, advance corporation tax, income tax (including tax falling to be deducted or withheld from or accounted for in respect of any payment), national insurance and social security contributions, capital gains tax, inheritance tax, value added tax, customs excise and import duties, stamp duty, stamp duty reserve tax, stamp duty land tax, insurance premium tax, air passenger duty, landfill tax, petroleum revenue tax, advance petroleum revenue tax, gas levy or tonnage tax;

Tax Authority” means any Tax or other authority (whether within or outside the United Kingdom) which is competent to assess, administer or collect Tax;

Tax Claim” means a Tax Deed Claim and/or a Tax Warranty Claim;

Tax Deed” means the tax deed of covenant to be entered into on or around the date of this Agreement and effective as at Completion;

Tax Deed Claim” means a claim under the Tax Deed;

Tax Statute” means any statute, statutory instrument, decree, order, enactment, law, directive or regulation providing for or imposing any Tax;

Tax Warranty Claim” means a claim for a breach of any of the Tax Warranties;

TPCL” means Tyrrells Potato Crisps Limited, a company incorporated in England and Wales with registered number 04339626;

 

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Transaction” means the proposed acquisition of the Securities by the Purchaser pursuant to this Agreement and the other matters contemplated by the Transaction Documents;

Transaction Documents” means this Agreement, the Management Warranty Deed, the Tax Deed, the Disclosure Letter and any other document entered into or to be entered into pursuant to this Agreement;

Transfer Allocation Loans” means the loans (not exceeding a principal amount of £23,209.31 in aggregate) to be advanced by the Company to certain Management Sellers to acquire 4,500 B Ordinary Shares from the Institutional Seller, of which the sum of £23,209.31 shall be paid to the Company in accordance with the Transfer Payment Direction Letter;

Transfer Payment Direction Letter” means the letter from the Institutional Seller directing certain Management Sellers to pay the consideration for the transfer of the 4,500 B Ordinary Shares to certain Management Sellers to the Company in full and final settlement of the Leaver Loans; and

US Transfer Agreement” means the agreement for the transfer of Tyrrells Inc. from Tyrrells Group Limited to Amplify in the Agreed Form.

1.2 In this Agreement any reference, express or implied, to an enactment (which includes any legislation in any jurisdiction) includes:

(a) that enactment as amended, extended or applied by or under any other enactment (before, on or after the date of this Agreement);

(b) any enactment which that enactment re-enacts (with or without modification); and

(c) any subordinate legislation (including regulations) made (before, on or after the date of this Agreement) under that enactment, including (where applicable) that enactment as amended, extended or applied as described in subparagraph (a), or under any enactment which it re-enacts as described in subparagraph (b), except to the extent that any legislation or subordinate legislation made or enacted after the date of this Agreement would create or increase the liability of any Seller under this Agreement.

1.3 In this Agreement:

(a) words denoting persons include bodies corporate and unincorporated associations of persons;

(b) references to an individual include his estate and personal representatives;

(c) subject to clause 18, references to a party to this Agreement include the successors or assigns (immediate or otherwise) of that party;

(d) the words including and include shall mean including without limitation and include without limitation, respectively;

 

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(e) any reference importing a gender includes the other genders;

(f) any reference to a time of day is to London time;

(g) any reference to £ is to British pounds sterling;

(h) any reference to writing includes typing, printing, lithography, photography, email and facsimile but excludes any other form of Electronic Communication;

(i) any reference to a document is to that document as amended, varied or novated from time to time otherwise than in breach of this Agreement or that document;

(j) a person shall be deemed to be connected with another if that person is connected with another within the meaning of section 1122 of the Corporation Tax Act 2010;

(k) all covenants, warranties, representations, undertakings and indemnities given or made by any Sellers in this Agreement are given or made severally;

(l) any reference to a company includes any company, corporation or other body corporate wherever incorporated; and

(m) any reference to a company or firm includes any company or firm in succession to all, or substantially all, of the business of that company or firm.

1.4 If there is any conflict or inconsistency between a term in the body of this Agreement and a term in any of the schedules or any other document referred to or otherwise incorporated into this Agreement, the term in the body of this Agreement shall take precedence.

1.5 The ejusdem generis rule does not apply to this Agreement. Accordingly, specific words indicating a type, class or category of thing shall not restrict the meaning of general words following such specific words, such as general words introduced by the word other or a similar expression. Similarly, general words followed by specific words shall not be restricted in meaning to the type, class or category of thing indicated by such specific words.

1.6 A reference in this Agreement to any English legal term for any action, remedy, method or form of judicial proceeding, legal document, court or any other legal concept or matter shall be deemed to include a reference to the corresponding or most similar legal term in any jurisdiction other than England, to the extent that such jurisdiction is relevant to the Transaction or the terms of this Agreement.

1.7 In addition to terms defined elsewhere in this Agreement, the definitions and other provisions in this clause 1 apply throughout this Agreement, unless the contrary intention appears.

1.8 In this Agreement, unless the contrary intention appears, a reference to a clause, sub-clause or schedule is a reference to a clause, sub-clause or schedule of or to this Agreement. The schedules, and the recitals in the Background section, form part of this Agreement.

1.9 The headings in this Agreement do not affect its interpretation.

 

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2. SALE AND PURCHASE

2.1 Each Seller shall sell, or procure the sale of, with full title guarantee and the Purchaser shall purchase the full legal and beneficial title to those Securities set out opposite the name of such Seller in column (1) and columns (7) to (11) (inclusive) of the Master Allocation Schedule, on the terms and conditions set out in this Agreement.

2.2 The Securities shall be sold free from all Encumbrances and together with all rights attaching to them including the right to receive all distributions and dividends declared, paid, made or accruing after Completion and all interest accruing or paid after Completion, on the terms and conditions set out in this Agreement.

2.3 The consideration for the sale of the Securities shall be determined in accordance with clause 3.

2.4 Each Seller irrevocably waives (and shall procure the irrevocable waiver by its nominee(s) of) all rights of pre-emption which it (or such nominee(s)) may have (whether under the Company’s constitutional documents or otherwise), including any rights created after the date of this Agreement and on or before Completion in respect of the transfer to the Purchaser or its nominee(s) of the Securities or any of them.

2.5 The Purchaser shall not be obliged to complete the sale or purchase of any of the Securities unless all of the Securities are sold and purchased simultaneously.

3. CONSIDERATION AND ROLLOVER

3.1 The consideration for the sale of the Securities payable to the Sellers (the “Consideration”) shall be an amount equal to the aggregate of:

(a) for the sale of the Shares, the Share Consideration; plus

(b) for the sale of the Investor Loan Notes, the Loan Note Cash Consideration.

3.2 The Rollover Loan Notes to be issued to each Rollover Manager as part of the Share Consideration shall have a par value equal to

A x B

where (i) A is the number of shares of common stock of Amplify to which the Rollover Manager would have been entitled had he elected to receive Share Equity Consideration (which, for the avoidance of doubt, such aggregate amount of Share Equity Consideration had the Rollover Managers elected to receive Share Equity Consideration rather than Rollover Loan Notes would have been 2,083,689 (as set out in column (17) of the Master Allocation Schedule)) rather than Rollover Loan Notes; and (ii) B is the market value per share of that common stock, based on the closing price of such stock on the Business Day before the Final Master Allocation Schedule is provided by the Institutional Seller in accordance with clause 6.2.

3.3 Any payment made by a Seller to the Purchaser under this Agreement and/or any other Transaction Document (whether as damages for breach, under a covenant to pay or otherwise) shall, to the extent possible, be deemed to reduce the consideration paid for the Securities sold by that Seller.

 

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3.4 The Purchaser shall not have any liability for the allocation of the Consideration amongst the Sellers.

3.5 The parties agree that they will take all reasonably necessary steps and enter into all documentation (including, without limitation, elections under section 431 of the Income Tax (Earnings and Pensions Act 2003) required to effect a tax-efficient rollover of the Rollover Loan Notes (directly or indirectly) into shares in the common stock of Amplify immediately following Completion in such manner as is agreed between the parties.

3.6 The Management Sellers who are beneficiaries of the Allotment Allocation Loans, the Reserved Share Allocation and Transfer Allocation Loans shall indemnify the Purchaser (for itself and on behalf of the Company and each Subsidiary) against any liability to account for income tax or employee national insurance under the Pay-As-You-Earn scheme or otherwise, and, in any jurisdiction other than the United Kingdom, similar payroll Tax or social security payments or deductions arising in respect of the Allotment Allocation Loans, the Reserved Share Allocation and the Transfer Allocation Loans, and (without limiting the extent of the indemnity provided for by this clause 3.6) the Purchaser shall be entitled to deduct from the Cash Consideration payable to the Management Sellers any such Amounts and shall, to the extent of any such deduction, be treated as having satisfied its obligation to pay such amounts to the Management Sellers.

3.7 Andrew Blain may at any time prior to the date which is 2 Business Days prior to the date on which the Final Master Allocation Schedule is required to be delivered under clause 6.2, notify the Institutional Sellers and the Purchaser that he wishes to have his Loan Notes acquired and not redeemed. If he makes such a notification in accordance with this clause 3.7, the Purchaser shall at Completion acquire the Loan Notes set out opposite Andrew Blain’s name in column 4 of the Final Master Allocation Schedule and such Loan Notes shall be treated as Investor Loan Notes for the purposes of the definition of Loan Note Cash Consideration and shall be excluded from the definition of Management Loan Notes for the purposes of the definition of Loan Note Redemption Amount.

4. CONDITION PRECEDENT

The Anti-Trust Condition

The sale and purchase of the Securities is conditional upon the satisfaction of the Anti-Trust Condition.

Anti-Trust Condition Satisfaction

4.1 The Purchaser undertakes to use its reasonable endeavours to procure (so far as it is so able to procure) that the Anti-Trust Condition is fulfilled as soon as is practicable and in particular (and without prejudice to the generality of the foregoing) the Purchaser will:

(a) procure that, to the extent required, pre-notification discussions concerning the Transaction are commenced with the FCO as soon as reasonably practicable following the date of this Agreement and in any event within two Business Days of the date of this Agreement;

(b) procure the filing of the notification of the Transaction in a form reasonably acceptable to the Institutional Seller and the Management Representatives with the FCO as

 

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soon as reasonably practicable after the date of this Agreement and in any event within seven Business Days of the date of this Agreement or such longer period which is reasonably acceptable to the Institutional Seller and the Management Representatives;

(c) not enter into (and will procure that no member of the Purchaser’s Group enters into) any other agreement or arrangement where the effect of any such agreement or arrangement is likely to delay, impede or in any respect prejudice the fulfilment of the Anti-Trust Condition; and

(d) offer, accept and agree to any conditions, obligations, undertakings and/or modifications and take such other steps as, in each case and in the Purchaser’s reasonable discretion, are acceptable (which shall not, without the prior written approval of the Institutional Seller and the Management Representatives, include any amendment, variation or modification of the terms of this Agreement or any other Transaction Document) and that is required by the FCO or which is necessary in order to procure the satisfaction of the Anti-Trust Condition and allow Completion to occur prior to the Long Stop Date.

4.2 The Purchaser shall:

(a) promptly provide all information which is requested or required by the FCO;

(b) promptly notify the Institutional Seller and the Management Representatives (and their advisers) of any communication (whether written or oral) from the FCO (in each case, to the extent permitted by law or regulation);

(c) give the Institutional Seller and the Management Representatives (and their advisers) reasonable notice of all meetings with the FCO and give the Institutional Seller and the Management Representatives (and their advisers) reasonable opportunity to participate thereat (save to the extent that the FCO expressly requests that the Institutional Seller or the Management Representatives should not be present at the meeting or part or parts of the meeting);

(d) give the Institutional Seller and the Management Representatives (and their advisers) reasonable notice of all telephone calls with the FCO and give the Institutional Seller and the Management Representatives (and their advisers) reasonable opportunity to participate thereat (save to the extent that the FCO expressly requests that the Institutional Seller and the Management Representatives should not be present at the telephone call or part or parts of the telephone call), and, if so requested by the Institutional Seller or the Management Representatives, the Institutional Seller and the Management Representatives shall be provided with a written summary of any material information arising out of or any material communication made in connection with such telephone calls as soon as possible thereafter (save to the extent that the FCO expressly requests that the Institutional Seller and the Management Representatives should not be provided with such information); and

(e) provide the Institutional Seller and the Management Representatives (and their advisers) with final drafts of all written communications intended to be sent to the FCO, give the Institutional Seller and the Management Representatives a reasonable opportunity to comment thereon, not send such communications without the prior approval of the Institutional Seller and the Management Representatives (such approval not to be unreasonably withheld) and provide the Institutional Seller and the Management Representatives (and their advisers) with final copies of all such communications subject in

 

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each case to exclusion by the Purchaser of information that it reasonably considers to be confidential to it (provided that such confidential information is provided to the Institutional Seller’s Solicitors on an attorney only basis).

4.3 The Institutional Seller and the Management Representatives shall co-operate with the Purchaser in providing to the Purchaser such assistance as is reasonably necessary and it or he is able to provide (including, for the avoidance of doubt, attendance at meetings or on telephone calls with the relevant party or the FCO as is reasonably required by the Purchaser), and to provide to the FCO and/or the Purchaser’s Solicitors such information as may reasonably be necessary and it is able to provide to ensure that the Anti-Trust Condition is fulfilled as soon as is reasonably practicable.

4.4 Each Seller shall:

(a) not take or enter into (and will, in the case of the Institutional Seller, procure that no member of the Institutional Sellers’ Group takes or enters into) any action, agreement or arrangement which is likely to delay, impede or in any respect prejudice the fulfilment of the Anti-Trust Condition; and

(b) promptly notify the Purchaser (and its advisers) of any communication (whether written or oral) received from the FCO (in each case, to the extent permitted by law or regulation).

4.5 Each party shall bear its own costs in relation to any filings or notifications submitted pursuant to this clause 4.

Termination

4.6 If the Anti-Trust Condition is not satisfied on or before the Long Stop Date, or the Institutional Seller, the Management Representatives and the Purchaser agree in writing that it became incapable of satisfaction on or before the Long Stop Date this Agreement shall automatically terminate. If this Agreement terminates in accordance with this sub-clause:

(a) except for this clause 4.6, and clauses 1, 11, 14, 15, 19, 21.2 to 21.13, 22, 23, and 24, all the provisions of this Agreement shall lapse and cease to have effect; and

(b) neither the lapsing of those provisions nor their ceasing to have effect shall affect any accrued rights or liabilities of any party in respect of damages for non-performance of any obligation falling due for performance prior to such lapse and cessation.

5. PRE-COMPLETION UNDERTAKINGS

5.1 Until Completion each Management Seller undertakes to the Purchaser that he shall, use his reasonable endeavours to the extent that he is legally permitted or entitled to do so by exercising his rights as a shareholder, director and/or employee of the Group (as applicable) and save to the extent expressly provided for in the Transaction Documents, procure that:

(a) the business of each Group Company is carried on in the ordinary course consistent with past practice and in accordance with applicable law so as to maintain such business as a going concern;

 

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(b) subject to clause 5.4, no Group Company shall, without the prior written consent of the Purchaser (such consent not to be unreasonably conditioned, withheld or delayed):

(i) make any increase or reduction of its share or loan capital or grant any option to subscribe for or acquire or reorganise any of its share or loan capital (other than to another Group Company);

(ii) declare or pay any dividend or make any other distribution in respect of its profits, assets, or reserves or undertake any other return of capital (other than to another Group Company);

(iii) amend its constitutional documents or the instruments constituting the Loan Notes;

(iv) sell, transfer or dispose of, or grant any option to acquire, any part of its business, undertaking or any material asset owned by the Group having a net book value of more than £50,000;

(v) acquire or enter into a legally binding commitment to acquire (whether by purchase, subscription or otherwise) any material business;

(vi) grant any Encumbrance over any of its assets (other than charges arising by operation of law or in the ordinary course of trading);

(vii) make material change to its accounting policies or practices or change its accounting reference date;

(viii) other than in the ordinary course of trading enter into any partnership or joint venture with any person;

(ix) borrow any monies or incur any indebtedness or other liability other than (A) trade credit in the ordinary course of trading or (B) drawing down under the Existing Facilities in accordance with ordinary course drawdowns under the revolving credit facility or (C) entering into finance leases in the ordinary course;

(x) make any loan or give any credit other than in the ordinary course of business and consistent with past practice;

(xi) make any unbudgeted capital expenditure of greater than £50,000;

(xii) enter into or offer to enter into or terminate any contract to which the Group is a party (excluding those entered into by way of purchase order) with an annual revenue or expenditure exceeding £800,000;

(xiii) amend any contract to which the Group is a party (excluding those entered into by way of purchase order) where such variation would result in a change in annual revenue or expenditure exceeding £300,000;

(xiv) in relation to any of the Properties (as defined in the Management Warranty Deed):

(A) change its existing use;

 

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(B) terminate or give a notice to terminate any lease; or

(C) materially vary terms of any lease.

(xv) materially amend, vary, waive, enter into, offer to enter into or terminate (or give notice to terminate) any terms of employment of a Senior Employee;

(xvi) enter into any agreement or understanding with any trade union, works council or other employee representative body;

(xvii) save as required by law, establish a new pension scheme for or in respect of any employee employed by a Group Company or amend, exercise a discretion which increases pension scheme liabilities or employer costs in relation to or discontinue (wholly or partly), any pension scheme applying to any employee employed by a Group Company;

(xviii) give any guarantee, indemnity to secure an obligation of a third party;

(xix) commence, settle or compromise, or waive any right in respect of any litigation or arbitration where the amount claimed is £100,000 or more or affects the reputation of any Group Company except for collection in the ordinary course of trading debts;

(xx) transfer, dispose of or grant any rights or licences under, or enter into any licensing or similar agreements or arrangements with respect to the Intellectual Property Rights (as defined in the Management Warranty Deed) other than (A) in the ordinary course of business and consistent with past practice or (B) the acquisition of licenses for off-the-shelf software;

(xxi) permit or suffer any of its insurance policies, or material permits or licences to lapse;

(xxii) make, change or revoke any Tax election, or settle or compromise any proceedings with respect to any Tax claim or assessment;

(xxiii) cease or propose to cease to carry on its business or be wound up or enter into any form of administration or other insolvency process;

(xxiv) do anything that involves, or leads, directly or indirectly, to a change of residence of a Group Company;

(xxv) do anything that relates to any scheme, transaction or arrangement that gives rise, or may give rise, to a liability to Tax under any anti-avoidance legislation or that gives rise to a duty to notify a Tax Authority under any legislation introduced to counter tax avoidance;

(xxvi) do anything that relates to or involves the making of a distribution or deemed distribution for Tax purposes, the creation, cancellation, or reorganisation of share capital or loan capital, the creation, cancellation or repayment of any intra-group debt of any Group Company becoming or ceasing to be, or being treated as ceasing to be, a member of a group of companies, or becoming or ceasing to be associated or connected with any other company for Tax purposes;

 

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(xxvii) agree to do any of the actions referred to in sub-clauses 5.1(b)(i) to 5.1(b)(xxvi) above.

5.2 The obligations on each Management Seller in clause 5.1 are given on a several basis only (and not on a joint or joint and several basis).

5.3 Subject to clause 5.4, until Completion the Institutional Seller undertakes to the Purchaser that it shall:

(a) not exercise its rights as a shareholder to approve, or fail to exercise any rights as a shareholder or any contractual rights of control (including, but not limited to, any veto rights pursuant to the Investment Agreement) to prevent; and

(b) procure that its Institutional Directors (subject to their fiduciary duties) shall not approve, or fail to exercise any rights as a director or any contractual rights of control (including, but not limited to, any veto rights pursuant to the Investment Agreement) to prevent, any of the actions or steps referred to in clause 5.1(a) or clause 5.1(b) without the prior written consent of the Purchaser, such consent not to be unreasonably withheld or delayed (save to the extent that such action is expressly provided for in the Transaction Documents).

5.4 Clauses 5.1 and 5.3 shall not operate to restrict or prevent:

(a) any action taken at the written request of the Purchaser or with its prior written approval;

(b) any action taken in accordance within any legally binding contract entered into by any Group Company prior to the date of this Agreement, details of which have been Disclosed in the Data Room;

(c) any act or conduct which a Management Seller or Institutional Director is required to take, or omit to take, in order to comply with his fiduciary duties in his capacity as a director of a Group Company;

(d) any act or conduct which any Seller or Group Company is required to take, or omit to take, as a result of, or in order to comply with, any applicable law or regulation of any applicable Government Authority;

(e) the Deferral Process;

(f) the Reserved Share Allocation (including the making of loans to the Management Sellers for the purpose of implementing the Reserved Share Allocation);

(g) the entering into new leases in respect of the properties numbered 1 and 3 in Schedule 5 to the Management Warranty Deed;

 

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(h) any action taken that is (i) materially consistent with the Business Plan, provided that the aggregate capital expenditure budget set out therein is not exceeded or (ii) specifically provided for in the Business Plan;

(i) changing the accounting reference date of any of the Group Companies incorporated in Australia to bring them into line with the accounting reference date of the other Group Companies;

(j) the entering into of any co-manufacturing agreements in the ordinary course;

(k) replacing the insurance policies of any Group Company with under another insurance policy maintained by the Group where the level of coverage is no less comprehensive;

(l) the Company negotiating, finalising or otherwise taking action in respect of the advanced thin capitalisation agreement (ATCA) currently being negotiated between the Company and HM Revenue & Customs, provided that the Sellers shall consult with the Purchaser in good faith in relation to those matters; or

(m) any matter expressly contemplated or provided for in this Agreement or another Transaction Document.

5.5 Not less than three Business Days prior to Completion, the Institutional Seller shall provide the Purchaser with:

(a) a draft of the Final Master Allocation Schedule;

(b) a good faith estimate of the Internal Debt Repayment Amount;

(c) a good faith estimate of the External Debt Repayment Amount;

(d) a good faith estimate of the outstanding Manager Loans and Investor Loan; and

(e) a good faith estimate of the Sellers’ Transaction Expenses Amount.

5.6

(a) Each Management Seller who is a beneficiary of the Reserved Share Allocation shall pay, or procure the payment of, any stamp duty or stamp duty reserve tax or other Taxes (other than employer national insurance contributions or any equivalent tax in any other jurisdictions) in respect of the Reserved Share Allocation.

(b) Jochen Krumm agrees that he shall indemnify the Purchaser and any Group Company (on an after-tax basis) in respect of any Taxes for which they are liable in respect of the March 2016 share allocation to him.

(c) The Purchaser agrees that it will not make (and will procure that no Group Company makes) any voluntary disclosure to any tax authority in relation to the matters referred to in clause 5.6(b) unless (i) such disclosure is required by law or (ii) the making of such disclosure is agreed in writing by Jochen Krumm (such agreement not to be unreasonably withheld or delayed).

 

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(d) In the event that either a voluntary disclosure is made under 5.6(c) or any tax authority takes any action or raises any assessment which may give rise to a liability under the indemnity in clause 5.6(b), the Purchaser shall consult with Jochen Krumm in good faith in relation to such disclosure, action or assessment and shall (at Jochen Krumm’s cost) take such action as Jochen Krumm may reasonably request (including, without limitation, commissioning a tax valuation of the shares where relevant and, if relevant, seeking to agree such valuation with the relevant tax authority) to seek to mitigate or eliminate Jochen Krumm’s liability under the indemnity in clause 5.6(b).

5.7 The Sellers shall promptly (and in any event within ten Business Days of the date of this Agreement) file a notification pursuant to section 19 of the German Real Estate Transfer Tax Act (Grunderwerbsteuergesetz) (the “German Real Estate Filing”) in valid form with the competent Tax Authority.

5.8 On and from the date of this Agreement, the Sellers undertake in their capacity as shareholders, directors, officers or employees in or of the Company or any member of the Group (as applicable) to the Purchaser to use all reasonable endeavours to:

(a) deliver to the Purchaser the audited historical financial statements of the Company as of and for the three year period ended March 31, 2016, prepared in accordance with IFRS as issued by the IASB and in accordance with Regulation S-X and Rule 3-05 promulgated thereunder and an opinion on such historical audited financial statements of KPMG LLP, the Company’s independent outside auditor;

(b) obtain:

(i) written confirmation from Costa Limited (in a form satisfactory to the Purchaser) that the assignment of intellectual property rights in the purchasing contract between TPCL and Costa Limited dated 1 March 2013 only applies to the extent the deliverables have been created specifically for Costa Limited and accordingly that the assignment of intellectual property rights clause does not apply to the products currently being supplied TPCL; and

(ii) written consent to the Transaction from the relevant lessor (in a form satisfactory to the Purchaser) under the following leases:

(A) rental agreement between Lecce Nominees Pty Ltd (as lessor) and Yarra Valley Snack Foods Pty Limited (as lessee) dated 1 October 2013 in respect of the premises located at 45 Industrial Park Drive, Lilydale, 3140; and

(B) rental agreement between Dasma Recycling Pty Ltd (as lessor) and Yarra Valley Snack Foods Pty Limited (as lessee) dated 15 January 2013 in respect of the premises located at 26 East Court Lilydale, 3140.

5.9 Each of the Sellers shall procure that in the period between the date of this Agreement and Completion the Group conducts all export transactions in accordance with applicable provisions of the United States export control laws and regulations, including the Export Administration Regulations and the regulations administered by the Office of Foreign Assets Control of the U.S. Treasury Department, and the export control laws and regulations of any other applicable jurisdiction.

 

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5.10 The Purchaser shall use its all reasonable endeavours to procure that Amplify award to each of Andrew Blain and Jochen Krumm at Completion the number of restricted stock units set out in their respective RSU Term Sheet.

6. COMPLETION

6.1 Completion shall take place at the offices of the Institutional Seller’s Solicitors on the later of:

(a) the sixth Business Day after (and excluding) the date on which the Anti-Trust Condition is satisfied; and

(b) the first Business Day after (and excluding) the date on which the period of fifteen (15) consecutive business days from the date of receipt by Jefferies Finance LLC of the Required Bank Information (as defined in the Commitment Letter) in accordance with the terms of the Commitment Letter (the “Marketing Period”) is completed, provided that if the Marketing Period is not completed prior to 19 August 2016, it shall commence on 6 September 2016, or at such other location or time as may be agreed by the Institutional Seller, the Management Representatives and the Purchaser in writing.

6.2 The Institutional Seller shall (having agreed the same with the Management Representatives), on or before 2:00pm on the Business Day prior to Completion, provide the Purchaser with:

(a) the Final Master Allocation Schedule;

(b) the amount of the Internal Debt Repayment Amount;

(c) the amount of the External Debt Repayment Amount;

(d) the amount of the outstanding Manager Loans and the Investor Loan;

(e) the amount of the Sellers’ Transaction Expenses Amount; and

(f) the principal value of Rollover Loan Notes to be issued pursuant to clause 3.2.

6.3 At Completion:

(a) the Sellers shall observe and perform the provisions of Part 1 of Schedule 2 to the extent applicable to them; and

(b) the Purchaser shall observe and perform the provisions of Part 2 of Schedule 2.

6.4 All documents and items delivered at Completion pursuant to clause 6.3(a) and (b) and Schedule 2 shall be held by the recipient to the order of the person delivering the same until such time as Completion shall be deemed to have taken place. Simultaneously with the:

(a) delivery of all documents and items required to be delivered at Completion in accordance with clauses 6.3(a) and (b) and Schedule 2 (or waiver of the delivery of it by the person entitled to receive the relevant document or item, or the Purchaser’s decision to proceed to Completion pursuant to clause 6.5(c)); and

(b) receipt of an electronic funds transfer to the bank account of the Institutional Seller’s Solicitors of the Consideration due to the Institutional Seller and the Management Sellers or the delivery of an undertaking to pay from the Purchaser’s Solicitors to the Institutional Seller’s Solicitors in a form reasonably satisfactory to the Institutional Seller’s Solicitors, the documents and items delivered in accordance with clauses 6.3(a) and (b) and Schedule 2 shall cease to be held to the order of the person delivering them and Completion shall be deemed to have taken place.

 

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6.5 If one or more of the Sellers fail to comply with the provisions of Part 1 of Schedule 2, the Purchaser may elect (in addition and without prejudice to all other rights or remedies available to it), by giving notice to the Institutional Seller and the Management Representatives:

(a) not to complete the purchase of the Securities, in which case the provisions of clause 6.7 shall apply; or

(b) to fix a new time and date for Completion (being not more than 20 Business Days after the original date for Completion) in which case the provisions of clauses 6.2, 6.3 and 6.3(b) and Schedule 2 shall apply to Completion as so deferred but on the basis that such deferral may occur only once; or

(c) to proceed to Completion so far as practicable, each of the relevant Sellers then being obliged to use its best endeavours to perform or procure the performance of any of the outstanding provisions of Part 1 of Schedule 2 on or before such date as is specified by the Purchaser.

6.6 If the Purchaser fails to comply with the provisions of Part 2 of Schedule 2, the Institutional Seller and the Management Representatives may jointly elect, (in addition and without prejudice to all other rights and remedies available to them), by notice to the Purchaser:

(a) not to complete the sale of the Securities, in which case the provisions of clause 6.7 shall apply; or

(b) to fix a new time and date for Completion (being not more than 20 Business Days after the original date for Completion) in which case the provisions of clauses 6.2, 6.3 and 6.6 and Schedule 2 shall apply to Completion as so deferred but on the basis that such deferral may occur only once.

6.7 If the Institutional Seller and the Management Representatives jointly elect or the Purchaser elects not to complete the purchase or sale of the Securities under clauses 6.4 or 6.6:

(a) except for this clause 6.7, and clauses 1, 11, 14, 15, 19, 21.2 to 21.13 (excluding 21.6), 22, 23 and 24, all the provisions of this Agreement shall lapse and cease to have effect; and

(b) neither the lapsing of those provisions nor their ceasing to have effect shall affect any accrued rights or liabilities of any party in respect of damages for non-performance of any obligation falling due for performance prior to such lapse and cessation.

 

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6.8 On and from the date of this Agreement to and including Completion:

(a) the Sellers shall procure that the Company (or any member of the Group (as applicable)):

(i) obtains customary payoff letters and releases of any existing security interests and other obligations in respect of the payoff, discharge, and termination of all obligations under the Existing Facilities, with effect from the Completion Date; and

(ii) at least three Business Days prior to Completion, provides documents or other information reasonably requested by the lenders with respect to the Purchaser’s financing arrangements under applicable “know your customer” and anti-money laundering rules, policies and regulations, in each case, to the extent requested by the Purchaser at least ten Business Days prior to Completion; and

(b) the Institutional Seller shall use its commercially reasonably endeavours to procure (using the powers available to it as a shareholder of the Company) that the Company shall and the Management Sellers agree to use their commercially reasonable endeavours to, and shall use their commercially reasonable endeavours to cause the senior management of the Company (or any member of the Group (as applicable)), their representatives, financial, accounting and legal advisors to, at the Purchaser’s expense, provide the Purchaser with such cooperation as is reasonably requested by the Purchaser in order to comply with the terms and conditions in the Commitment Letter or that is customary in connection with financings of the type contemplated by the Commitment Letter, provided that (x) such requested cooperation does not unreasonably interfere with the ongoing operations of the Sellers (as permitted pursuant to this Agreement) and (y) none of the Company or any member of the Group shall be required to execute any agreements prior to Completion or take any action that would be effective prior to Completion (save, for the avoidance of doubt, the payoff letters).

6.9 Subject to the terms and conditions of this Agreement, Amplify, the Purchaser and the Purchaser’s Guarantor shall (i) use commercially reasonable efforts to enforce all of its rights pursuant to the Commitment Letter to obtain the debt financing at or prior to Completion and (ii) use its commercially reasonable efforts to obtain the proceeds of the debt financing on the terms and conditions (including any “flex” provisions) described in the Commitment Letter, including using its commercially reasonable efforts to (x) satisfy on a timely basis (or obtain the waiver of) all conditions and covenants within its control that are applicable to Amplify, the Purchaser and the Purchaser’s Guarantor in the Commitment Letter that are to be satisfied by Amplify, the Purchaser and the Purchaser’s Guarantor, (y) negotiate and enter into definitive agreements with respect to the Commitment Letter and (z) consummate the debt financing at or prior to Completion, subject to the satisfaction or waiver of the conditions contained therein (including in the event that all conditions in the Commitment Letter have been satisfied, using its commercially reasonable efforts to cause the Financing Sources to fund in accordance with the terms thereof at Completion).

6.10 Notwithstanding anything to the contrary in the Tax Deed, the parties agree that the Tax Deed shall not take effect until Completion.

 

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7. LEAKAGE

7.1 Each Institutional Seller and each Management Seller (in respect of itself only) severally covenants to the Purchaser that in the period from but excluding the Locked Box Date up to and including Completion:

(a) neither it, nor any of its Related Persons, has received or benefitted from any Leakage (either directly or indirectly); and

(b) no arrangement or agreement has been made or entered into (or will be made or entered into) that has resulted or will result in it or any of its Related Persons receiving or benefitting from any Leakage (either directly or indirectly).

7.2 In the event of any Leakage that results in a breach of the covenant contained in clause 7.1, the relevant Institutional Seller and Management Seller (as the case may be) severally covenants to pay to the Purchaser on demand (for itself and as trustee for each member of the Purchaser’s Group) an amount in cash equal (on a £ for £ basis) to:

(a) the aggregate of the amount or value of such Leakage received by it or its Related Persons or by which it or they benefitted; and

(b) the reasonable fees, costs or expenses incurred by the Purchaser as a consequence of recovering such Leakage, and the aggregate liability of each Seller under this clause 7.2 shall not exceed the amount payable hereunder.

7.3 Each Seller agrees to notify the Purchaser (and provide to the Purchaser such relevant information as is reasonably available) as soon as practicable if it becomes aware of the occurrence of any Leakage.

7.4 Where the value of the relevant Leakage is expressed in a currency other than British pound sterling, the value of each such Leakage claim shall be translated into British pound sterling by reference to the Exchange Rate on the date such Leakage occurred.

8. SELLERS’ WARRANTIES AND UNDERTAKINGS

8.1 Each Seller individually and severally (and not jointly or jointly and severally) warrants to the Purchaser that, subject to Completion and, save as provided for in clause 8.2:

(a) the Securities set out in the Master Allocation Schedule against its name will, at Completion, be legally and beneficially owned by it; and

(b) there are no, at the date of this Agreement, and will not be, at Completion, any Encumbrance on, over or affecting any of the Securities owned by such Seller.

8.2 In the event that, prior to Completion, (a) any stock transfer form relating to the Reserved Share Allocation has not been duly stamped and the register of members has not been updated accordingly in respect of some or all of the Reserved Shares (the “Pending Shares”) or (b) only the beneficial interest in the Pending Shares has been transferred and it has been agreed that the Institutional Seller will hold the legal title on behalf of the beneficial owners of the Pending Shares, then (i) the Institutional Seller shall instead individually and

 

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severally warrant to the Purchaser that the Pending Shares are legally owned by it and (ii) each Management Seller to whom any Pending Shares are being transferred in accordance with the Reserved Share Allocation shall instead individually and severally warrant to the Purchaser that the Pending Shares are beneficially owned by them and clause 8.1 shall be construed accordingly.

8.3 Each Seller individually and severally (and not jointly or jointly and severally) warrants to the Purchaser that as at the date of this Agreement and as at Completion:

(a) it has the power, capacity and authority to execute and deliver this Agreement and each of the other Transaction Documents to which it is or will be a party and to perform its obligations under each of them and has taken all action necessary to authorise such execution and delivery and the performance of such obligations;

(b) it is not insolvent or bankrupt or unable to pay its debts within the meaning of any laws relating to insolvency or bankruptcy binding upon it;

(c) this Agreement constitutes legal, valid and binding obligations on it in accordance with its terms. Each of the other Transaction Documents to which it is or will be a party will, when executed, constitute legal, valid and binding obligations on it in accordance with its terms;

(d) it understands that the Share Equity Consideration (i) has not been registered under the United States Securities Act of 1933, as amended (the “Securities Act”) by reason of their issuance in a transaction exempt from the registration requirements of the Securities Act pursuant to Section 4(2) thereof or Rule 506 promulgated under the Securities Act, (ii) must be held indefinitely unless a subsequent disposition thereof is registered under the Securities Act or is exempt from such registration, (iii) will bear a legend to such effect substantially in the form set out in Clause 17.4 and Amplify will make a notation on its transfer books to such effect and (iv) is subject to the Lock-Up Agreement. Each Seller further represents that it is familiar with Rule 144, as presently in effect, as promulgated by the Securities and Exchange Commission of the United States and understands the resale limitations imposed thereunder and by the Securities Act; and

(e) the entry by it into this Agreement and, as applicable, into each of the other Transaction Documents to which it is or will be a party and the performance by it of its obligations under this agreement and each other Transaction Document does not and will not:

(i) conflict with or constitute a default under any provision of:

(A) any agreement or instrument to which it is a party; or

(B) the constitutional documents of it (where applicable); or

(C) any law, lien, lease, order, judgment, award, injunction, decree, ordinance or regulation or any other restriction of any kind or character by which it is bound; or

(ii) result in the creation or imposition of any Encumbrance on any of the Securities owned by it.

 

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8.4 The Institutional Seller warrants to the Purchaser that, as at the date of this Agreement and as at Completion, it is an “accredited investor” within the meaning of Rule 501 of Regulation D, as presently in effect, as promulgated by the Securities and Exchange Commission of the United States under the Securities Act.

8.5 Each Management Seller individually and severally (and not jointly or jointly and severally) warrants to the Purchaser that as at the date of this Agreement and as at Completion:

(a) it either:

(i) is an “accredited investor” within the meaning of Rule 501 of Regulation D, as presently in effect, as promulgated by the Securities and Exchange Commission of the United States under the Securities Act; or

(ii) has such knowledge and experience in financial and business matters that it is capable of evaluating the merits and risks of the prospective investment in accordance with Rule 506(b)(2)(ii) of Regulation D, as presently in effect, as promulgated by the Securities and Exchange Commission of the United States under the Securities Act; and

(b) it has been provided with (i) an opportunity to discuss the business, management, financial affairs and the terms and conditions of the offering of the Share Equity Consideration with the management of Amplify, (ii) the information regarding Amplify specified in subsections (B) and (C) of Rule 502(b)(2)(ii) of Regulation D, as presently in effect, as promulgated by the Securities and Exchange Commission of the United States under the Securities Act, and (iii) the opportunity to obtain any additional information which Amplify possesses or can acquire without unreasonable effort or expense that is necessary to verify the accuracy of the information specified in the preceding clause.

8.6 Each of the Sellers’ Warranties is separate and independent and, except as expressly provided to the contrary in this Agreement, is not limited:

(a) by reference to any other of the Sellers’ Warranties; or

(b) by any other provision of this Agreement or the Management Warranty Deed (including any warranties contained therein).

9. LIMITATIONS ON SELLER LIABILITY

9.1 The liability of a Seller in respect of any and all breaches of this Agreement (other than a breach of the covenant set out in clause 7) and the Management Warranty Deed (other than a breach of the covenants set out in clause 5 therein) by it or him shall be limited to the amount of the Consideration received by it or him.

9.2 The liability of:

(a) the Institutional Sellers and the Management Sellers in respect of any claim under clause 7 shall terminate on the date falling nine months after Completion, except in respect of any claim of which notice is given to a Seller before that date; and

(b) the Sellers in respect of any claim under this Agreement (other than clause 7) shall terminate on the seventh anniversary of Completion, except in respect of any claim of which notice is given to a Seller before that date;

 

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and in each case, the liability of any Seller in respect of any claim shall in any event terminate if proceedings in respect of it have not been commenced within nine months after the giving of notice of that claim.

9.3 None of the limitations contained in this clause shall apply to any claim against a Seller to the extent that such claim arises as a result of fraud or wilful misconduct or concealment by that Seller or where such claim would not have arisen but for fraud or wilful misconduct or concealment by that Seller.

10. PURCHASER’S AND PURCHASER’S GUARANTOR’S WARRANTIES AND UNDERTAKINGS

10.1 Each of the Purchaser and the Purchaser’s Guarantor warrants to the Sellers that as at the date of this Agreement:

(a) it has the power, capacity and authority to execute and deliver this Agreement and each of the other Transaction Documents to which it is or will be a party and to perform its obligations under each of them and, subject to satisfaction of the Anti-Trust Condition, has taken all action necessary to authorise such execution and delivery and the performance of such obligations;

(b) it is not insolvent or bankrupt or unable to pay its debts within the meaning of any laws relating to insolvency binding upon it;

(c) this Agreement constitutes, and each of the other Transaction Documents to which it is or will be a party will, when executed, constitute legal, valid and binding obligations on it in accordance with its terms;

(d) subject to satisfaction of the Anti-Trust Condition, the entry by it into this Agreement and, as applicable, into each of the other Transaction Documents to which it is or will be a party and the performance of the obligations of it under this Agreement and each other Transaction Document does not and will not conflict with or constitute a default under any provision of:

(i) any agreement or instrument to which it is a party;

(ii) the constitutional documents of it; or

(iii) any law, lien, lease, order, judgment, award, injunction, decree, ordinance or regulation or any other restriction of any kind or character by which it is bound.

10.2 With effect from Completion the Purchaser shall, and shall procure that each Group Company shall, release and discharge each Institutional Director, the Chairman and any non-executive director from any and all liabilities or obligations to a Group Company and shall procure that each Group Company shall waive any and all claims it has or may have against any Institutional Director, the Chairman and any non-executive director in connection with his appointment as a director of, employment with, or conduct in relation to, any Group Company.

 

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10.3 Clause 10.2 shall not apply in case of (i) fraud on the part of such Institutional Director, Chairman and non-executive director, and/or (ii) where the Purchaser or the relevant Group Company providing such discharge would be in breach of any law or regulation (including, without limitation, section 232 of the Companies Act 2006) by doing so.

11. RELEASE BY THE SELLERS

11.1 Each of the Sellers confirms that, immediately following Completion, he or it has no claim (whether in respect of any breach of contract, compensation for loss of office or monies due to him or it or on any account whatsoever (other than in respect of any accrued salary or benefits under the Management Sellers’ respective employment agreements) outstanding against any Group Company or any of their respective present or former employees, directors or officers (together, the “Relevant Persons”) and that no agreement or arrangement (other than a contract of employment or any Transaction Document) is outstanding under which any Group Company or Relevant Person has or could have any obligation of any kind to him or it.

11.2 To the extent that any such claim or obligation exists or may exist, conditional upon Completion occurring each of the Sellers irrevocably and unconditionally waives such claim or obligation and releases each such Group Company and Relevant Person from any liability whatsoever in respect of such claim or obligation.

11.3 Any Group Company or Relevant Person may enforce the terms of this clause 11 in accordance with the Contracts (Rights of Third Parties) Act 1999.

12. CONFIDENTIALITY

12.1 Subject to clause 12.2 and clause 13:

(a) each party undertakes to each other party that it shall treat as confidential and not disclose or use any information received or obtained as a result of entering into or performing this Agreement which relates to:

(i) the provisions or the subject matter of this Agreement or any Transaction Document or any claim or potential claim thereunder; or

(ii) the negotiations relating to this Agreement or any Transaction Document;

(b) the Sellers (in each case, severally and not jointly or jointly and severally) shall treat as confidential and not disclose or use any information relating to the Group and any other information relating to the business, financial or other affairs (including future plans and targets) of the Purchaser’s Group; and

(c) the Purchaser shall treat as strictly confidential and not disclose or use any information disclosed to it relating to the business, financial or other affairs (including future plans and targets) of the Institutional Seller or the Institutional Seller’s Group.

12.2 Clause 12.1 does not apply to disclosure of any information:

(a) the disclosure or use of which is required to vest the full benefit of this Agreement in a party;

 

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(b) the disclosure or use of which is required by any Management Seller to properly discharge his duties or obligations as an employee, director or officer of a Group Company;

(c) that is or becomes publicly available (other than by breach of the Confidentiality Agreement or of this Agreement);

(d) that is independently developed after Completion without any reference to or use of the information referred to in clause 12.1;

(e) the disclosure or use of which is required by applicable law, any governmental or regulatory body, any court of competent jurisdiction or any rating agency, listing authority or securities or stock exchange on which the shares or other securities of any party or any member of an Institutional Seller’s Group or the Purchaser’s Group are listed (including where this is required as part of any actual or potential offering, placing and/or sale of securities of that party or any member of an Institutional Seller’s Group or the Purchaser’s Group);

(f) the disclosure or use of which is required for the purpose of any judicial or arbitral proceedings arising out of this Agreement or any other Transaction Document;

(g) the disclosure of which is made to a Tax Authority in connection with the Tax affairs of the disclosing party;

(h) the disclosure of which is made by the Institutional Seller on a need to know basis to any member of the Institutional Seller’s Group, on the basis that the recipient keeps the information confidential;

(i) the disclosure is made by the Purchaser on a need to know basis to any member of the Purchaser’s Group, on the basis that the recipient keeps the information confidential;

(j) the disclosure of which is made to any provider of finance or potential provider of finance to any member of the Purchaser’s Group (or to their advisers, agents, representatives, affiliates, officers and employees, in each case, only to the extent that they have a legitimate requirement to receive such information in order to perform their duties) or to a security trustee or agent acting on behalf of one or more banks or other financial institutions which have entered into, or may enter into, any financing, hedging or loan agreements with any members of the Purchaser’s Group, in each case, on the basis that the recipient keeps the information confidential;

(k) the disclosure of which is made to professional advisers of any party on a need to know basis, on the basis that the recipient keeps the information confidential; or

(l) the Purchaser, the Institutional Seller and the Management Representatives have each given prior written approval to the disclosure or use, provided that prior to disclosure or use of any information pursuant to clauses 12.2(a), 12.2(e) or 12.2(f) (except in the case of disclosure to a Tax Authority) the party concerned shall promptly notify (to the extent permitted by any applicable law or regulation) the other parties of such requirement with a view to providing (if reasonably practicable to do so) the other parties with the opportunity to contest such disclosure or use or otherwise to agree the timing and content of such disclosure or use.

 

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13. ANNOUNCEMENTS

With the exception of the Announcement which shall be made on the date hereof (or on such other date as may be agreed by the Purchaser, the Institutional Seller and the Management Representatives), each of the parties undertakes to the other parties that no announcement, communication or circular concerning the existence or provisions and subject matter of and negotiations relating to this Agreement or any other Transaction Document shall be made or issued by or on behalf of any party or any member of an Institutional Seller’s Group or the Purchaser’s Group (as applicable) without the prior written approval of the Purchaser, the Institutional Seller and the Management Representatives (such consent not to be unreasonably withheld, conditioned or delayed). This shall not affect any announcement, communication or circular:

(a) made or sent by a member of the Purchaser’s Group after Completion to an employee, customer, distributor or supplier of a Group Company simply informing it of the Purchaser’s purchase of the Securities;

(b) required by applicable law or any governmental or regulatory body, any Tax Authority, any court of competent jurisdiction or the rules of any relevant listing authority or securities or stock exchange on which the shares or other securities of any party or any member of an Institutional Seller’s Group or the Purchaser’s Group are listed, in each case whether or not the requirement has the force of law, but then only to the extent so required and the party with an obligation to make such an announcement or communication or issue a circular shall consult with the Purchaser, the Institutional Seller and the Management Representatives insofar as is reasonably practicable and permitted by law and regulation before complying with such an obligation.

14. GUARANTEE BY PURCHASER’S GUARANTOR

14.1 Subject to clause 14.5, the Purchaser’s Guarantor unconditionally and irrevocably:

(a) guarantees to the Sellers the payment when due of all amounts payable by the Purchaser under or pursuant to this Agreement and the other Transaction Documents;

(b) undertakes to ensure that the Purchaser will perform when due all its obligations under or pursuant to this Agreement and the other Transaction Documents;

(c) agrees that if and each time that the Purchaser fails to make any payment when it is due under or pursuant to this Agreement or any other Transaction Document, the Purchaser’s Guarantor must on demand (without requiring any Seller first to take steps against the Purchaser or any other person) pay that amount to the Sellers as if it were the principal obligor in respect of that amount; and

(d) agrees as principal debtor and primary obligor to indemnify the Sellers against all losses and damages sustained by it or them flowing from any non-payment or default of any kind by the Purchaser under or pursuant to this Agreement or any other Transaction Document.

 

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14.2 The Purchaser’s Guarantor’s obligations under this Agreement shall not be affected by any matter or thing which but for this provision might operate to affect or prejudice those obligations, including:

(a) any time or indulgence granted to, or composition with, the Purchaser or any other person;

(b) the taking, variation, renewal or release of, or neglect to perfect or enforce this Agreement, any other Transaction Document or any right, guarantee, remedy or security from or against the Purchaser or any other person;

(c) any variation or change to the terms of this Agreement or any other Transaction Document; or

(d) any unenforceability or invalidity of any obligation of the Purchaser, so that this Agreement shall be construed as if there were no such unenforceability or invalidity.

14.3 Until all amounts which may be or become payable under this Agreement and the other Transaction Documents have been irrevocably paid in full, the Purchaser’s Guarantor shall not as a result of this Agreement or any payment or performance under this Agreement be subrogated to any right or security of any Seller or claim or prove in competition with a Seller against the Purchaser or any other person or claim any right of contribution, set-off or indemnity.

14.4 The Purchaser’s Guarantor must reimburse the Sellers within 3 Business Days of demand for all legal and other costs (including VAT) properly incurred by it or them in connection with the enforcement of the Purchaser’s Guarantor’s obligations under this Agreement.

14.5 The payment obligations of the Purchaser’s Guarantor under this clause 14 shall take effect on and from 3 Business Days after the due date for payment by the Purchaser.

15. NOTICES

15.1 Any notice or other communication to be given in connection with this Agreement must be in writing in English and must be delivered or sent by post or email to the party to whom it is to be given as follows:

(a) if to a Seller, at the address specified against his or its relevant name in this Agreement, and/or IVC@paget-brown.com.ky in the case of the Institutional Seller, with copies to:

(i) in the case of the Institutional Seller:

Shearman & Sterling (London) LLP

9 Appold Street

London

EC2A 2AP

marked for the attention of Mark Soundy (mark.soundy@shearman.com); and

(ii) in the case of any Management Seller:

Travers Smith LLP

10 Snow Hill

London

EC1A 2AL

 

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marked for the attention of Ian Shawyer (ian.shawyer@traverssmith.com) and Lucie Cawood (lucie.cawood@traverssmith.com),

(such copies not in itself constituting valid service of such notice).

(b) if to the Management Representatives:

David Milner

#####

#####

#####

#####

#####

Email: David.Milner@tyrrellscrisps.co.uk

and

Joanne Jones

#####

#####

#####

#####

Email: Joanne@tyrrellscrisps.co.uk

with a copy to:

Travers Smith LLP

10 Snow Hill

London

EC1A 2AL

marked for the attention of Ian Shawyer (ian.shawyer@traverssmith.com) and Lucie Cawood (lucie.cawood@traverssmith.com),

(such copy not in itself constituting valid service of such notice).

(c) if to the Purchaser at:

500 West 5th St., Suite 1350

Austin

TX 78701

Email: tennis@amplifysnacks.com

marked for the attention of Tom Ennis,

 

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with a copy to:

Goodwin Procter (UK) LLP

Tower 42

25 Old Broad Street

London

EC2N 1HQ

marked for the attention of Richard Lever (RLever@goodwinlaw.com),

(such copy not in itself constituting valid service of such notice).

(d) if to the Purchaser’s Guarantor at:

500 West 5th St., Suite 1350

Austin

TX 78701

Email: tennis@amplifysnacks.com

marked for the attention of Tom Ennis,

with a copy to:

Goodwin Procter (UK) LLP

Tower 42

25 Old Broad Street

London

EC2N 1HQ

marked for the attention of Richard Lever (RLever@goodwinlaw.com),

(such copy not in itself constituting valid service of such notice).

or at any such other address or email address of which it or he shall have given notice for this purpose to the other parties. Any notice or other communication sent by post shall be sent by prepaid recorded delivery post (if within the United Kingdom) or by prepaid airmail (if the country of destination is not the same as the country of origin).

15.2 Unless there is evidence that it was received earlier, any notice or other communication shall be deemed to have been given:

(a) if delivered by hand, registered post or courier, at the time of delivery; or

(b) if sent by post, on the second Business Day after it was put into the post; or

(c) sent by email, when the email is sent, provided that a copy of the Notice is sent by another method referred to in this clause 15 within three Business Days of sending the email.

15.3 In proving the giving of a notice or other communication, it shall be sufficient to prove that delivery was made or that the envelope containing the communication was

 

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properly addressed and posted by prepaid recorded delivery post or by prepaid airmail or that the e-mail was properly addressed and transmitted by the sender’s server into the network and there was no apparent error in the operation of the sender’s e-mail system, as the case may be.

15.4 Service of any notice or other communication on the last known Management Representative shall be deemed to constitute valid service thereof on all or any of the Management Sellers.

15.5 This clause 15 shall not apply in relation to the service of any claim, form, notice, order, judgment or other document relating to or in connection with any proceedings, suit or action arising out of or in connection with this Agreement.

16. FURTHER ASSURANCES

16.1 On or after Completion each Seller shall (in respect of the Securities held by it only), execute and do (or procure to be executed and done by any other necessary party) all such deeds, documents, acts and things as may be required by law or as the Purchaser may from time to time reasonably require in order to vest any of the Securities in the Purchaser.

16.2 For so long after Completion as any Seller or any nominee of it remains the registered holder of any Security, it shall hold (or direct the relevant nominee to hold) that Security and any distributions, property and rights deriving from it in trust for the Purchaser and shall deal with that Security and any distributions, property and rights deriving from it as the Purchaser directs.

17. POST COMPLETION UNDERTAKINGS

17.1 For a period of six years following Completion, the Purchaser shall make available to any Seller, at such Seller’s expense, the Books and Records of the Group Companies in respect of the period prior to Completion which are reasonably required by that Seller for the purpose of dealing with its tax and accounting affairs. Such access to these Books and Records shall be granted upon reasonable notice by the Seller and, subject to there being no material disruption to the business of any Group Company, the Purchaser shall procure that such Books and Records are made available to the Seller for inspection (during normal working hours) and, where reasonably required for the purpose of dealing with such affairs, copying (at the Seller’s expense).

17.2 For a period of nine months following Completion, the Institutional Seller shall preserve and maintain its corporate existence and not propose or pass any resolution for the winding up of the Institutional Seller.

17.3 To ensure compliance with the restrictions imposed by this Agreement and the Securities Act with respect to the Share Equity Consideration, each Seller agrees that Amplify may issue appropriate “stop-transfer” instructions to its transfer agent, if any. Amplify shall not be required (i) to transfer on its books any portion of the Share Equity Consideration that have been sold or otherwise transferred in violation of any of the provisions of this Agreement or applicable securities laws or (ii) to treat as owner of such portion of the Share Equity Consideration, or to accord the right to vote or pay dividends, to any purchaser or other transferee to whom such portion of the Share Equity Consideration has been purportedly so transferred.

 

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17.4 Each book-entry security entitlement representing any Share Equity Consideration (or any other securities issued in respect of such shares upon any stock split, stock dividend, recapitalization, merger, consolidation or similar event) issued to or held by any Seller in accordance with the terms hereof shall bear the following legends (in addition to any other legends required by law or governing documents of Amplify):

THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”), OR UNDER THE SECURITIES LAWS OF ANY STATE. THESE SECURITIES ARE SUBJECT TO RESTRICTIONS ON TRANSFERABILITY AND RESALE AND MAY NOT BE TRANSFERRED OR RESOLD EXCEPT AS PERMITTED UNDER THE ACT AND APPLICABLE STATE SECURITIES LAWS, PURSUANT TO REGISTRATION OR EXEMPTION THEREFROM. INVESTORS SHOULD BE AWARE THAT THEY MAY BE REQUIRED TO BEAR THE FINANCIAL RISKS OF THIS INVESTMENT FOR AN INDEFINITE PERIOD OF TIME. THE ISSUER OF THESE SECURITIES MAY REQUIRE AN OPINION OF COUNSEL IN FORM AND SUBSTANCE REASONABLY SATISFACTORY TO THE ISSUER TO THE EFFECT THAT ANY PROPOSED TRANSFER OR RESALE IS IN COMPLIANCE WITH THE ACT AND ANY APPLICABLE STATE SECURITIES LAWS.

THE SHARES REPRESENTED HEREBY MAY BE TRANSFERRED ONLY IN ACCORDANCE WITH THE TERMS OF AN AGREEMENT BETWEEN THE COMPANY AND THE STOCKHOLDER, A COPY OF WHICH IS ON FILE WITH THE SECRETARY OF THE COMPANY.

The first legend set forth in this clause 17.4 shall be removed by Amplify from any book-entry security entitlement evidencing the Share Equity Consideration upon delivery by the holder thereof to Amplify of a written request to that effect if at the time of such written request (i) a registration statement under the Securities Act is at that time in effect with respect to the legended security or (ii) the legended security can be freely transferred in a transaction in compliance with Rule 144 under the Securities Act without such a registration pursuant to which Amplify issued the Share Equity Consideration, and, in the case of (ii) above, upon the request and in the discretion of Amplify or its transfer agent, the holder of such Share Equity Consideration (x) executes and delivers a representation letter that includes customary representations satisfactory to Amplify and its transfer agent regarding the holding requirements under Rule 144 under the Securities Act and whether such holder is an “affiliate” of Amplify for purposes of Rule 144 under the Securities Act and (y) secures the delivery to Amplify’s transfer agent of an opinion by counsel for Amplify, that such security can be freely transferred in a public sale in compliance with Rule 144 under the Securities Act or otherwise without a registration statement pursuant to an available exemption from the registration requirements of the Securities Act and that such transfer will not jeopardize the exemption or exemptions from registration pursuant to which Amplify issued the Share Equity Consideration; provided, that such opinion need not opine on whether or not such holder is an “affiliate” for purposes of Rule 144 under the Securities Act.

17.5 Each Seller acknowledges and the Purchaser shall procure that each Group Company acknowledges that the Purchaser may make an election pursuant to Section 338(g) of the Code (a “Section 338(g) Election”) with respect to any Group Company that is a foreign corporation within the meaning of Section 7701(a)(5) of the United States Internal Revenue Code of 1986, as amended (the “Code”) in connection with the transactions effected and/or contemplated pursuant to this Agreement. In the event that a Section 338(g) Election is

 

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made, the Purchaser shall be responsible for preparing any applicable purchase price allocation for Tax purposes, and the Purchaser shall, and shall procure that each applicable Group Company shall, and the Sellers shall each file all Tax Returns, and execute such other documents as may be required by any Governmental Authority, in a manner consistent with such purchase price allocation. The Purchaser, the Group Companies, and the Sellers agree not to take any position inconsistent with any Section 338(g) Election or related purchase price allocation.

18. ASSIGNMENTS

No party may assign, transfer, charge or otherwise deal with all or any of its rights or obligations under this Agreement nor grant, declare, create or dispose of any right or interest in it, save that:

18.1 the Institutional Seller may assign (in whole or in part) the benefit of this Agreement to any Institutional Seller’s Permitted Assignee, provided that if such assignee ceases to be an Institutional Seller’s Permitted Assignee, all benefits relating to this Agreement assigned to such assignee shall be deemed automatically by that fact to be re-assigned to the Institutional Seller immediately before such cessation;

18.2 the Purchaser may assign (in whole or in part) the benefit of this Agreement to any other member of the Purchaser’s Group, provided that if such assignee ceases to be a member of the Purchaser’s Group, all benefits relating to this Agreement assigned to such assignee shall be deemed automatically by that fact to be re-assigned to the agreement immediately before such cessation; and

18.3 the Purchaser or any member of the Purchaser’s Group may charge and/or assign (in whole or in part) the benefit of this Agreement to any person providing debt financing and/or hedging facilities to the Purchaser or any member of the Purchaser’s Group or to any security agent or any person or persons acting as trustee, nominee or agent for any such person by way of security for the facilities being made or to be made available to the Purchaser or member of the Purchaser’s Group and any such person, security agent, trustee, nominee or agent may also, in the event of enforcement of such security in accordance with its terms, assign the benefit of such obligations and rights to a purchaser or assignee who acquires the Company or all or part of its business from that person, security agent, trustee, nominee or agent (or any receiver appointed by any of them), provided that any such assignee shall not be entitled to receive under this Agreement any greater amount than that to which the assignor would have been entitled and neither the Purchaser nor any Seller, as applicable, shall be under any greater obligation or liability than if such assignment had never occurred.

19. PAYMENTS

19.1 Unless otherwise expressly stated (or as otherwise agreed in writing in the case of a given payment), each payment to be made under this Agreement or any of the Transaction Documents shall be made in British pounds sterling by transfer of the relevant amount into the relevant account on or before the date the payment is due for value on that date. The relevant account for a given payment is:

(a) if that payment is to any of the Institutional Sellers, the account of the Institutional Seller’s Solicitors (details of which have been provided to the Purchaser’s Solicitors) and the receipt of the Institutional Seller’s Solicitors shall be a sufficient discharge for the Purchaser of its obligations under this clause 19.1 and the Purchaser shall not be concerned to see to the application thereof or be responsible for the loss or misapplication of such sum, or such other account as the Institutional Seller shall, not less than three Business Days before the date that payment is due, have specified for payments to the Institutional Sellers by giving notice to the Purchaser for the purpose of that payment;

 

39


(b) if that payment is to any of the Management Sellers, the account of the Management Sellers’ Solicitors (details of which have been provided to the Purchaser’s Solicitors) and the receipt of the Management Sellers’ Solicitors shall be a sufficient discharge for the Purchaser of its obligations under this clause 19.1 and the Purchaser shall not be concerned to see to the application thereof or be responsible for the loss or misapplication of such sum, or such other account as the Management Representatives shall, not less than three Business Days before the date that payment is due, have specified for payments to that Management Seller by giving notice to the Purchaser for the purpose of that payment; and

(c) if that payment is to the Purchaser, such account of the Purchaser as the Purchaser shall, not less than three Business Days before the date that payment is due, have specified by giving notice to the Institutional Seller and the Management Representatives for the purpose of that payment.

20. GROSS UP

20.1 All amounts due under this Agreement or any of the Transaction Documents shall be paid in full, without any set-off, counterclaim, deduction or withholding (other than any deduction or withholding of tax required by law). If any deductions or withholdings are required by law to be made from any of the sums payable under this Agreement, the paying party shall provide any evidence of the relevant withholding as the receiving party may reasonably require and shall, save in relation to interest, pay to the receiving party any sum as will, after the deduction or withholding is made, leave the receiving party with the same amount as it would have been entitled to receive without that deduction or withholding.

20.2 Payments made under clause 20.1 shall be subject to the financial limitations set out in paragraph 3 of Schedule 2 of the Management Warranty Deed.

20.3 If a payment is to be made under this Agreement or any of the Transaction Documents to a person other than the original Purchaser or the original Seller, then the paying party shall be required to make an increased payment pursuant to clause 20.1 only to the extent that such an increased payment would have been required to be made had the recipient of the payment been the original Purchaser or the original Seller.

21. GENERAL

21.1 Each of the obligations, warranties and undertakings set out in this Agreement (excluding any obligation which is fully performed at Completion) shall continue in force after Completion.

 

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21.2 Where any obligation, representation, warranty or undertaking in this Agreement is expressed to be made, undertaken or given by two or more of the Sellers, they shall (unless otherwise expressly provided to the contrary) be severally (and not jointly or jointly and severally) responsible in respect of it.

21.3 The Purchaser may release or compromise in whole or in part the liability of any of the Sellers under this Agreement or grant any time or indulgence to that Seller without affecting the liability of any other Seller.

21.4 Any consent given in accordance with the provisions of this Agreement by the Management Representatives in connection with this Agreement shall bind all the Management Sellers.

21.5 Time is not of the essence in relation to any obligation under this Agreement unless:

(a) time is expressly stated to be of the essence in relation to that obligation; or

(b) one party fails to perform an obligation by the time specified in this Agreement and another party serves a notice on the defaulting party requiring it to perform the obligation by a specified time and stating that time is of the essence in relation to that obligation.

21.6 The Purchaser shall procure that a Group Company shall pay the Sellers’ Transaction Expenses on Completion. The Purchaser shall pay any stamp duty or other taxes payable in respect of the transfer of the Securities. Except as provided in this clause 21.6 each party shall pay the costs, charges and other expenses incurred by it in connection with the entering into and completion of this Agreement.

21.7 This Agreement may be executed in any number of counterparts, all of which, taken together shall constitute one and the same agreement, and any party (including any duly authorised representative of a party) may enter into this Agreement by executing a counterpart.

21.8 The rights of each party under this Agreement:

(a) may be exercised as often as necessary;

(b) except as otherwise expressly provided in this Agreement, are cumulative and not exclusive of rights and remedies provided by law; and

(c) may be waived only in writing and specifically.

Delay in exercising or non-exercise of any such right is not a waiver of that right.

21.9 No party shall be entitled to terminate or rescind this Agreement except under clause 4.6, 6.5 or 6.6.

21.10 Except as otherwise expressly stated in this Agreement, a person who is not a party to this Agreement may not enforce any of its terms under the Contracts (Rights of Third Parties) Act 1999.

 

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21.11 The rights and obligations of the Sellers and the Purchaser under this Agreement shall continue for the benefit of, and shall be binding on, their respective successors and assigns.

21.12 No amendment of this Agreement (or of any other Transaction Document) shall be valid unless it is in writing and duly executed by or on behalf of all of the parties to it.

21.13 The provisions contained in each clause and sub-clause of this Agreement shall be enforceable independently of each of the others and their validity shall not be affected if any of the others are invalid. If any of those provisions is void but would be valid if some part of the provision were deleted, the provision in question shall apply with such modification as may be necessary to make it valid.

22. WHOLE AGREEMENT

22.1 This Agreement and the other Transaction Documents contain the whole agreement between the parties relating to the Transaction and supersede all previous agreements, whether oral or in writing, between the parties relating to these transactions.

22.2 Each party:

(a) acknowledges that in agreeing to enter into this Agreement and the other Transaction Documents it has not relied on any express or implied representation, warranty, collateral contract or other assurance made by or on behalf of any other party before the entering into of this Agreement and not expressly incorporated in this Agreement or any other Transaction Document; and

(b) waives all rights and remedies which, but for this sub-clause 22.2, might otherwise be available to it in respect of any such express or implied representation, warranty, collateral contract or other assurance.

22.3 Each party agrees and acknowledges that its only right and remedy in relation to any representation, warranty or undertaking made or given in connection with this Agreement shall be for damages for any breach of the terms of this Agreement and each of the parties waives all other rights and remedies (including those in tort or arising under statute) in relation to any such representation, warranty or undertaking.

22.4 Nothing in this clause or elsewhere in this Agreement limits or excludes any liability for, or remedy in respect of, fraud.

23. MANAGEMENT REPRESENTATIVES

23.1 The Management Representatives shall be entitled to carry out the functions expressly conferred on them by this Agreement only.

23.2 The Management Sellers hereby appoint the Management Representatives, acting jointly, to act as their representative and agree that, subject to clause 23.3, the Purchaser may rely, without enquiry, upon any action of the Management Representatives as the act of the Management Sellers in all matters referred to in this Agreement as being carried out by the Management Representatives, provided that the parties expressly agree that the Management Representatives shall not have the power or authority to negotiate, agree or settle any matter relating to a claim under this Agreement on behalf of any Management Seller without the prior express written authorisation of that Management Seller.

 

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23.3 At any time, the Management Sellers may appoint replacement Management Representatives by decision taken by Management Sellers representing seventy five per cent. of the aggregate number of B Ordinary Shares held by the Management Sellers as at the date of this Agreement. Any such successor shall agree in writing to accept the appointment in accordance with the terms of this Agreement and such appointment shall be promptly (and in any event within three Business Days) notified to the Institutional Seller and the Purchaser in writing.

23.4 The Management Sellers undertake that a Management Representative shall be appointed at all times.

23.5 Each Management Seller agrees that the Management Representatives owes no responsibility, duty of care or liability whatsoever in connection with his appointment as a Management Representative unless such Management Representative is fraudulent or dishonest (the “Retained Liabilities”), and accordingly, except in respect of the Retained Liabilities, the Management Representative shall not be liable to any other Management Seller for any act or omission in connection with the performance by him of any of his duties, functions or role as Management Representative pursuant to this Agreement. Except in respect of the Retained Liabilities, each Management Seller agrees not to bring any action or claim against a Management Representative in connection with his appointment as a Management Representative and/or in relation to any action which the Management Representative has taken or omitted to take in the past or may in the future take or omit to take in his capacity as a Management Representative.

23.6 Each Management Seller hereby undertakes to indemnify and keep indemnified and hold harmless each Management Representative from all losses, costs, damages, expenses (including professional fees) and any other liabilities that may be incurred by such Management Representative (in that capacity) as a result of the performance of his duties, functions and role as a Management Representative under this Agreement, provided that no Management Representative shall be entitled to indemnification for and in respect of the Retained Liabilities or any matter where his actions or inactions are in breach of this Agreement.

24. SERVICE OF PROCESS

24.1 The Institutional Seller irrevocably appoints Investcorp Securities Limited (registered number 02217792) of 48 Grosvenor Street, Mayfair, London W1K 3HW as its agent to receive and acknowledge on its behalf service of any writ, summons, order, judgment or other notice in connection with any proceeding, suit or action arising out of or in connection with this Agreement in England and Wales (“Proceedings”). If the agent named above (or its successor) at any time ceases for any reason to act as such or have an address in England or Wales, the Institutional Seller shall appoint a replacement agent having an address for service in England or Wales and shall notify the Purchaser of the name and address of the replacement agent. Failing such appointment and notification, the Purchaser shall be entitled by notice to the Institutional Seller to appoint a replacement agent to act on behalf of the Institutional Seller. This clause 24.1 applying to service on an agent applies equally to service on a replacement agent. The Institutional Seller further agrees that any Proceedings shall be sufficiently served on it if delivered to such agent for service at its address for the time being in England or Wales whether or not such agent gives notice thereof to the Institutional Seller.

 

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24.2 Each of Brendan Harris, Andrew Blain and Jochen Krumm irrevocably appoints the Management Representatives as his agent to receive and acknowledge on its behalf service of any Proceedings and the Management Representatives agree to provide notice to Brendan Harris, Andrew Blain and Jochen Krumm (as applicable) informing them that such service documentation have been issued in connection with Proceedings following receipt and copies of such documents. If the agent named above (or its successor) at any time ceases for any reason to act as such or have an address in England or Wales, each of Brendan Harris, Andrew Blain and Jochen Krumm shall appoint a replacement agent having an address for service in England or Wales and shall notify the Purchaser of the name and address of the replacement agent. Failing such appointment and notification, the Purchaser shall be entitled by notice to the Management Representatives to appoint a replacement agent to act on behalf of Brendan Harris, Andrew Blain and Jochen Krumm. This clause 24.2 applying to service on an agent applies equally to service on a replacement agent. Each of Brendan Harris, Andrew Blain and Jochen Krumm further agrees that any Proceedings shall be sufficiently served on him if delivered to such agent for service at its address for the time being in England or Wales whether or not such agent gives notice thereof to Brendan Harris, Andrew Blain and Jochen Krumm.

24.3 The Purchaser’s Guarantor irrevocably appoints the Purchaser as its agent to receive and acknowledge on its behalf service of any Proceedings. If the agent named above (or its successor) at any time ceases for any reason to act as such or have an address in England or Wales, the Purchaser’s Guarantor shall appoint a replacement agent having an address for service in England or Wales and shall notify the Institutional Seller of the name and address of the replacement agent. Failing such appointment and notification, the Institutional Seller shall be entitled by notice to the Purchaser’s Guarantor to appoint a replacement agent to act on behalf of the Purchaser’s Guarantor. This clause 24.3 applying to service on an agent applies equally to service on a replacement agent. The Purchaser’s Guarantor further agrees that any Proceedings shall be sufficiently served on it if delivered to such agent for service at its address for the time being in England or Wales whether or not such agent gives notice thereof to the Purchaser’s Guarantor.

25. GOVERNING LAW AND JURISDICTION

25.1 This Agreement and any non-contractual obligations arising out of or in connection with it shall be governed by, and interpreted in accordance with, English law.

25.2 The English courts have exclusive jurisdiction to settle any dispute, claim or controversy arising out of or in connection with this Agreement (including a dispute, claim or controversy relating to any non-contractual obligations arising out of or in connection with this Agreement) and the parties submit to the exclusive jurisdiction of the English courts.

25.3 The parties waive any objection to the English courts on grounds that they are an inconvenient or inappropriate forum to settle any such dispute.

25.4 Each party irrevocably and unconditionally waives, to the fullest extent permitted by applicable law, any right it may have to a trial by jury in any legal action or proceeding arising, directly or indirectly, out of or relating to this Agreement and the Transaction and for any counterclaim therein (in each case whether based on contract, tort or any other theory and whether predicated on common law, statute or otherwise). Each party (a) certifies that no representative, agent or attorney of any other party has represented, expressly or otherwise, that such other party would not, in the event of litigation, seek to enforce the foregoing waiver, and (b) acknowledges that it and the other parties have been induced to enter into this Agreement by, amongst other things, the mutual waivers and certifications in this clause.

 

44


AS WITNESS this Agreement is executed as a deed by the parties (or their duly authorised representatives) and is delivered and takes effect on the date at the beginning of this Agreement.

 

45


SCHEDULE 1

THE MANAGEMENT SELLERS

 

Name

David Milner
Joanne Jones
Michael Hedges
Stuart Telford
Janice Bennett
Andrew Blain
Jochen Krumm
Brendan Harris
Nicola Milner
Philip Jones
Emma Hedges
Denise Telford

 

46


SCHEDULE 2

COMPLETION

Part 1

Sellers’ Obligations

1. At Completion each Seller shall deliver to the Purchaser or procure the delivery of:

(a) a duly executed transfer form or forms in favour of the Purchaser for the Securities held by such Seller (and/or forms of transfer in respect of the beneficial interest in such Securities where the legal and beneficial interest is not held by the same Seller, as contemplated by clause 8.2);

(b) the certificates for the Securities held by such Seller together with certificates in respect of the entire issued share capital of each Group Company (or a lost certificate indemnity in the Agreed Form);

(c) a power of attorney in the Agreed Form to allow the Purchaser (or its nominee) to exercise all rights in respect of the Shares transferred by that Seller following Completion (a “Power of Attorney”);

(d) in respect of David Milner, Joanne Jones, Michael Hedges, Stuart Telford, Janice Bennett, Brendan Harris and the Institutional Seller only, counterparts of their respective Direction Letters duly executed by each of the parties;

(e) a counterpart of the Deed of Termination duly executed by such Seller and one counterpart of the Deed of Termination duly executed by the relevant Group Companies;

(f) the common seal (if any), statutory registers, certificates of incorporation and certificates of incorporation on change of name for the Company;

(g) the security and authentication codes for the Companies House WebFiling service or corporate key for filings at the Australian Securities and Investment Commission (ASIC) for each Group Company (as applicable);

(h) any power of attorney under which any Transaction Document has been executed;

(i) a release and duly executed discharge of any fixed or floating charges, mortgages, debentures and guarantees to which any of the Group Companies is a party;

(j) an amendment, in the Agreed Form, to the Registration Rights Agreement, dated as of August 10, 2015, by and among Amplify and each of the other parties thereto (the “Registration Rights Agreement”), duly executed by the Institutional Seller and David Milner, in order to grant “piggyback” registration rights in respect of the Share Equity Consideration to the Sellers pursuant to Section 2.2 of the Registration Rights Agreement;

(k) the Lock-Up Agreement duly executed by each Seller receiving any Share Equity Consideration;

 

47


(l) amendments to the existing service agreements for each of David Milner, Joanne Jones, Michael Hedges, Stuart Telford, Janice Bennett, Andrew Blain and Jochen Krumm, each in the Agreed Form (the “Service Agreements”) duly signed by the relevant Management Seller;

(m) restricted stock unit award agreements each in the Agreed Form duly signed by David Milner, Joanne Jones, Michael Hedges, Stuart Telford and Janice Bennett, which give effect to the terms in all material respects of their respective RSU Term Sheets for each such person;

(n) the US Transfer Agreement duly signed for or on behalf of Tyrrells Group Limited and Tyrrells, Inc.; and

(o) signed versions of any documentation to be executed by any Rollover Manager in relation to the rollover referred to in clause 3.5.

2. At Completion, the Institutional Seller shall deliver to the Purchaser:

2.1 a copy of the minutes of a duly held meeting of the directors or written resolutions of the directors of the Institutional Seller (or a duly constituted committee thereof) authorising the execution by the Institutional Seller of the Transaction Documents to which it is a party and, where such execution is authorised by a committee of the board of directors of the Institutional Seller (as the case may be), a copy of the minutes of a duly held meeting of the directors of the Institutional Seller constituting such committee; and

2.2 a letter of resignation in the Agreed Form from each of the Institutional Directors (confirming that he has no claim against a Group Company) (the “Institutional Director Resignation Letter”).

3. At Completion, the Sellers shall procure the passing of board resolutions of each requisite Group Company, among other things:

(a) approving the registration of the transfers of Securities in favour of the Purchaser subject only to stamping; and

(b) accepting the resignations of the Institutional Directors and appointing such persons as the Purchaser may nominate as directors and secretary (if any).

Part 2

Purchaser’s Obligations

1. At Completion the Purchaser shall:

(a) telegraphically transfer to the bank account of the Institutional Seller’s Solicitors an amount equal to the sum of the Share Cash Consideration and the Loan Note Cash Consideration (less an amount equal to the Manager Loans and the Investor Loan);

(b) telegraphically transfer to the bank account of the Institutional Seller’s Solicitors the Loan Note Redemption Amount (less any Tax required to be deducted in respect of accrued but unpaid interest), receipt of which sum by the Institutional Seller’s Solicitors shall discharge the Purchaser from its obligation to pay the Loan Note Redemption Amount to the Sellers who hold Management Loan Notes (and the Purchaser shall not be concerned to see the application of any such amount thereafter);

 

48


(c) telegraphically transfer to the bank account of the Company or TPCL (as applicable) an amount equal to the Manager Loans and the Investor Loan (less any Tax required to be withheld in respect of accrued but unpaid interest) in accordance with the Direction Letters;

(d) direct Amplify to issue the Share Equity Consideration, in electronic book-entry form, in the number of shares to each Seller set forth next to the name of each such Seller on the Final Master Allocation Schedule;

(e) issue the Rollover Loan Notes to each Rollover Manager calculated in accordance with clause 3.2;

(f) cause Amplify to deliver to each Seller an amendment, in the Agreed Form, to the Registration Rights Agreement duly executed by Amplify and other requisite parties pursuant thereto, in order to grant “piggyback” registration rights in respect of the Share Equity Consideration to the Sellers pursuant to Section 2.2 of the Registration Rights Agreement;

(g) procure the delivery by Amplify to each of David Milner, Joanne Jones, Michael Hedges, Stuart Telford and Janice Bennett their respective restricted stock unit award agreement in the Agreed Form, duly signed by Amplify;

(h) procure the payment by the Company to the Institutional Seller of an amount equal to the Internal Debt Repayment Amount (less any Tax required to be withheld in respect of accrued but unpaid interest); and

(i) procure the payment by the relevant Group Companies to the Agent and/or other Finance Party (as defined in the Senior Facility Agreement) as applicable of an amount equal to the External Debt Repayment Amount (less any Tax required to be withheld in respect of accrued but unpaid interest).

2. At Completion the Purchaser shall deliver to each Seller:

(a) any power of attorney under which any Transaction Document has been executed;

(b) a copy of the minutes of a duly held meeting of the directors or written resolutions of the directors of the Purchaser authorising the execution by the Purchaser of the Transaction Documents to which it is a party; and

(c) signed versions of any documentation to be executed by the Purchaser or any member of the Purchaser’s Group in relation to the rollover referred to in clause 3.2.

3. At Completion the Purchaser’s Guarantor shall deliver to each Seller:

(a) any power of attorney under which any Transaction Document has been executed; and

(b) a copy of the minutes of a duly held meeting of the directors or written resolutions of the directors of, or written consent of, the Purchaser’s Guarantor authorising the execution by the Purchaser’s Guarantor of the Transaction Documents to which it is a party.

 

49


SIGNATORIES

 

EXECUTED by the Parties as a deed    
EXECUTED as a deed by
for and on behalf of
the Institutional Seller
 

)

)

)

 
     

/s/ Bonnie Willkom

      Director
in the presence of:      
Signature of witness  

/s/ Ica Eden

   
Name of witness  

Ica Eden

   
Address of witness  

PO Box 1111

   

Grand Cayman KY1-1102

   

Cayman Islands

   
Occupation of witness  

Corporate Admin

   

 

[Signature page to SPA]


SIGNED as a deed by or on behalf of
David Milner
 

)

)

)

 
     

/s/ David Milner

in the presence of:      
Signature of witness  

/s/ Eleanor Gill

   
Name of witness  

Eleanor Gill

   
Address of witness  

Travers Smith LLP

   

10 Snow Hill

   

London EC1A 2AL

   
Occupation of witness  

Trainee Solicitor

   

 

SIGNED as a deed by or on behalf of
Joanne Jones
 

)

)

)

 
     

/s/ Joanne Jones

in the presence of:      
Signature of witness  

/s/ Eleanor Gill

   
Name of witness  

Eleanor Gill

   
Address of witness  

Travers Smith LLP

   

10 Snow Hill

   

London EC1A 2AL

   
Occupation of witness  

Trainee Solicitor

   

 

[Signature page to SPA]


SIGNED as a deed by or on behalf of

Michael Hedges

 

)

)

)

 
     

/s/ Michael Hedges

in the presence of:      
Signature of witness  

/s/ Eleanor Gill

   
Name of witness  

Eleanor Gill

   
Address of witness  

Travers Smith LLP

   

10 Snow Hill

   

London EC1A 2AL

   
Occupation of witness  

Trainee Solicitor

   

 

SIGNED as a deed by or on behalf of

Stuart Telford

 

)

)

)

 
     

/s/ Stuart Telford

in the presence of:      
Signature of witness  

/s/ Eleanor Gill

   
Name of witness  

Eleanor Gill

   
Address of witness  

Travers Smith LLP

   

10 Snow Hill

   

London EC1A 2AL

   
Occupation of witness  

Trainee Solicitor

   

 

[Signature page to SPA]


SIGNED as a deed by or on behalf of

Janice Bennett

 

)

)

)

 
     

/s/ Janice Bennett

in the presence of:      
Signature of witness  

/s/ Eleanor Gill

   
Name of witness  

Eleanor Gill

   
Address of witness  

Travers Smith LLP

   

10 Snow Hill

   

London EC1A 2AL

   
Occupation of witness  

Trainee Solicitor

   

 

SIGNED as a deed by or on behalf of

Andrew Blain

 

)

)

)

 
     

/s/ Andrew Blain

in the presence of:      
Signature of witness  

/s/ Chris Dobson

   
Name of witness  

Chris Dobson

   
Address of witness  

#####

   

#####

   

 

   
Occupation of witness  

#####

   

 

[Signature page to SPA]


SIGNED as a deed by or on behalf of

Jochen Krumm

 

)

)

)

 
     

/s/ Jochen Krumm

in the presence of:      
Signature of witness  

/s/ Eleanor Gill

   
Name of witness  

Eleanor Gill

   
Address of witness  

Travers Smith LLP

   

10 Snow Hill

   

London EC1A 2AL

   
Occupation of witness  

Trainee Solicitor

   

 

SIGNED as a deed by or on behalf of

Brendan Harris

 

)

)

)

 
     

/s/ Brendan Harris

in the presence of:      
Signature of witness  

/s/ Marie Winther Bothen

   
Name of witness  

Marie Winther Bothen

   
Address of witness  

#####

   

#####

   

 

   
Occupation of witness  

#####

   

 

[Signature page to SPA]


SIGNED as a deed by David Milner

as attorney for on behalf of

Nicola Milner

 

)

)

)

 
     

/s/ David Milner

in the presence of:       Attorney
Signature of witness  

/s/ Eleanor Gill

   
Name of witness  

Eleanor Gill

   
Address of witness  

Travers Smith LLP

   

10 Snow Hill

   

London EC1A 2AL

   
Occupation of witness  

Trainee Solicitor

   

 

SIGNED as a deed by Joanne Jones

as attorney for on behalf of

Philip Jones

 

)

)

)

 
     

/s/ Joanne Jones

in the presence of:       Attorney
Signature of witness  

/s/ Eleanor Gill

   
Name of witness  

Eleanor Gill

   
Address of witness  

Travers Smith LLP

   

10 Snow Hill

   

London EC1A 2AL

   
Occupation of witness  

Trainee Solicitor

   

 

[Signature page to SPA]


SIGNED as a deed by Michael Hedges

as attorney for on behalf of

Emma Hedges

 

)

)

)

 
     

/s/ Michael Hedges

in the presence of:       Attorney
Signature of witness  

/s/ Eleanor Gill

   
Name of witness  

Eleanor Gill

   
Address of witness  

Travers Smith LLP

   

10 Snow Hill

   

London EC1A 2AL

   
Occupation of witness  

Trainee Solicitor

   

 

SIGNED as a deed by Stuart Telford

as attorney for on behalf of

Denise Telford

 

)

)

)

 
     

/s/ Stuart Telford

in the presence of:       Attorney
Signature of witness  

/s/ Eleanor Gill

   
Name of witness  

Eleanor Gill

   
Address of witness  

Travers Smith LLP

   

10 Snow Hill

   

London EC1A 2AL

   
Occupation of witness  

Trainee Solicitor

   

 

[Signature page to SPA]


EXECUTED as a deed by

for and on behalf of

the Purchaser

 

)

)

)

 
     

/s/ Thomas Ennis

      Director
in the presence of:      
Signature of witness  

/s/ Brian Goldberg

   
Name of witness  

Brian Goldberg

   
Address of witness  

500 W. Fifth STr.

   

Suite 1350

   

Austin, TX 78701

   
Occupation of witness  

CFO

   
EXECUTED as a deed on behalf of SkinnyPop Popcorn LLC, a company incorporated in Delaware, acting by its member, Amplify Snack Brands, Inc., a company incorporated in Delaware, in turn acting by Thomas Ennis, being a person who, in accordance with the laws of that territory, is acting under the authority of the company  

)

)

)

 
     

/s/ Thomas Ennis

      Authorised signatory

 

[Signature page to SPA]

(Back To Top)

Section 3: EX-2.2 (EX-2.2)

EX-2.2

Exhibit 2.2

Dated 6 August 2016

THE WARRANTORS

- and -

THE PURCHASER

 

 

WARRANTY DEED

RELATING TO THE SALE AND PURCHASE OF

CRISPS TOPCO LIMITED

 

 


TABLE OF CONTENTS

 

CLAUSE    PAGE  
1.  

INTERPRETATION

     1   
2.  

WARRANTIES

     8   
3.  

WARRANTORS’ REPRESENTATIVE

     9   
4.  

PRESERVATION OF INFORMATION

     10   
5.  

PROTECTIVE COVENANTS

     10   
6.  

GENERAL

     11   
7.  

W&I INSURANCE

     12   
8.  

ENTIRE AGREEMENT

     13   
9.  

ASSIGNMENT

     14   
10.  

NOTICES

     14   
11.  

AGENT FOR SERVICE

     15   
12.  

UNITED STATES TAX COOPERATION

     16   
13.  

INVALIDITY

     16   
14.  

DELIVERY

     16   
15.  

COUNTERPARTS

     16   
16.  

GOVERNING LAW AND JURISDICTION

     16   
SCHEDULE 1 WARRANTIES      17   
SCHEDULE 2 LIMITATIONS ON LIABILITY      42   
SCHEDULE 3 WARRANTORS      48   
SCHEDULE 4 GROUP COMPANIES      49   
SCHEDULE 5 PROPERTIES      50   
SCHEDULE 6 INTELLECTUAL PROPERTY RIGHTS      51   


THIS DEED is made on 6 August 2016

BETWEEN:

(1) The several persons whose names and addresses are set out in columns (1) and (2) of the table set out in Schedule 3 to this Deed (together the “Warrantors” and each a “Warrantor”); and

(2) THUNDERBALL BIDCO LIMITED, a company incorporated in England (registered no. 10309824), whose registered office is at 20-22 Bedford Row, London, WC1R 4JS (the “Purchaser”).

INTRODUCTION

(A) On the date of this Deed, the Purchaser has entered into the Sale and Purchase Agreement.

(B) In connection with entering into the Sale and Purchase Agreement each Warrantor has agreed to give the Warranties on the terms set out in this Deed.

(C) The Purchaser can only make a claim under the Warranties if Completion occurs in accordance with the terms of the Sale and Purchase Agreement.

IT IS AGREED:

1. INTERPRETATION

1.1 In this Deed, words and expressions defined and interpretations included in the Sale and Purchase Agreement have the same meanings and interpretations, unless the context requires otherwise.

1.2 In this Deed:

2006 Act” means the Companies Act 2006;

Accounts” means the audited consolidated accounts of the Group, prepared in accordance with Applicable Law, as consistently applied, for the financial year ended on the Accounts Date, a copy of which is contained in the Data Room;

Accounts Date” means 1 April 2016;

Acts” means the Companies Act 1985 and the 2006 Act;

Applicable Law” means any applicable national, federal, supernational, state, regional, provincial, local or other statute, law, ordinance, regulation, rule code, guidance, order, published practice, judgment or decision of a governmental authority;


Australian Business” means the business of producing and selling potato crisps, vegetable crisps and popcorn as carried on by the Australian Subsidiaries as at the date of this Deed;

Australian Subsidiaries” means the subsidiary undertakings of the Company which are incorporated in Australia, details of which are set out in Schedule 4;

Business” means the business of producing and selling potato crisps, vegetable crisps and popcorn as carried on by the Group as at the date of this Deed (which, for the avoidance of doubt, includes the Australian Business and the German Business);

Business Day” means a day (other than a Saturday, Sunday or public holiday in England) when banks in the City of London are open for business;

Claim” means any claim by the Purchaser against the Warrantors for any breach of the Warranties (and, for the avoidance of doubt, includes a Tax Warranty Claim but does not include a Tax Deed Claim (as defined in the Sale and Purchase Agreement));

Code” means the United States Internal Revenue Code of 1986, as amended;

Company” means Crisps Topco Limited, details of which are set out in Schedule 4;

Completion” has the meaning given to it in the Sale and Purchase Agreement;

Completion Date” has the meaning given to it in the Sale and Purchase Agreement;

Confidential Information” means all technical, financial, commercial and other information of a confidential nature relating to the Business, including without limitation, trade secrets, know-how, inventions, product information, marketing and business plans, projections, internal affairs of the Group Companies, current and/or prospective suppliers and customers (including any customer or supplier lists) and any other person who has had material dealings with them;

Consideration” has the meaning given to it in the Sale and Purchase Agreement;

Data Room” means the Thunderball online data room hosted by Merrills;

Disclosed” and “Disclosed Matter” both mean any fact, matter, event or circumstance which is Fairly Disclosed in the Disclosure Documents;

Disclosure Documents” means the Disclosure Letter and the Transaction Documents;

Disclosure Letter” means the letter from the Warrantors to the Purchaser executed and delivered immediately prior to the execution and delivery of this Deed containing disclosures against the Warranties;

Dispute” has the meaning given in clause 16.2;

EHS Consents” means all consents, licences, authorisations, permits, registrations or other approvals required under applicable EHS Laws;

EHS Laws” means all or any international, European, national, civil or criminal law, common law, statute, statutory instrument, subordinate legislation, regulation, directive (including EC directives), ordinance, order, decree, injunction, treaty and the like concerning EHS Matters;

 

2


EHS Matters” means harm to or the protection of the environment or human or animal health and safety, workplace conditions, nuisance, discharges, emissions, and releases of hazardous substances to the environment;

Encumbrance” means any interest or equity of any person and any mortgage, charge (fixed or floating), lien, pledge, retention of title, option, right to acquire, right of pre-emption or other security interest of any kind and any agreement to create any of the foregoing;

Equipment” has the meaning given to it in Part III of Schedule 1;

Event” means any transaction, act, event, or occurrence of whatever nature, including without limitation the acquisition, disposal or realisation of any asset and the making of any claim, relevant for Tax purposes;

Exchange Rate” means in relation to any currency to be converted into or from British pound sterling on a particular day for the purposes of this Deed, the spot rate of exchange (the closing mid-point) for that currency into or, as the case may be, from British pound sterling on the Business Day before such particular day as published in the London edition of The Financial Times first published thereafter or, where no such rate of exchange is published in respect of the Business Day before such particular day, at the rate quoted by www.oanda.com as at the close of business in London on such Business Day;

Fairly Disclosed” means fairly disclosed, with sufficient detail to identify to the Purchaser the nature and scope of the matter disclosed;

Fixed Asset Register” means the fixed asset registers contained in the Data Room folder 3.8 for each of (i) the German Business dated 31 March 2016 (ii) Glennans dated March 2016 (iii) the Group excluding the Australian Business, the German Business and Glennans dated 1 April 2016 and (iv) the Australian Business covering the period 1 April 2015 to 1 April 2016;

Food” means any item or substance (including those of no nutritional value) used as ingredients in the preparation of food and the produce of such ingredients;

Food Laws” means all or any international, European, national, civil or criminal law, common law, statute, statutory instrument, subordinate legislation, regulation, directive (including EC directives), ordinance, order, decree, injunction, treaty and the like concerning Food Matters;

Food Matters” means any matter relating to the composition, contents, health or hygiene of Food or premises, plant, equipment or persons used or engaged in the manufacture, processing, storage, marketing or sale of Food;

German Business” means the business of producing and selling potato crisps, vegetable crisps and popcorn as carried on by the German Subsidiaries as at the date of this Deed;

German Subsidiaries” means the subsidiary undertakings of the Company which are incorporated in the Federal Republic of Germany, details of which are set out in Schedule 4;

 

3


Group” means the Company and the Subsidiaries and references to “Group Company” and “member of the Group” shall be construed accordingly;

Information Technology Systems” means the computer and data processing systems and related equipment and network equipment and/or computer software or programmes used by any member of the Group for the purposes of carrying on the Business;

Intellectual Property Rights” means patents, trade marks, trade names, domain names, service marks, design rights, copyright, database rights, Confidential Information and other intellectual property rights, in each case whether registered or unregistered and including applications for the grant of any such rights everywhere in the world;

Investment Agreement” has the meaning given to it in the Sale and Purchase Agreement;

IPR Agreements” means any agreement, understanding, commitment or arrangement (oral or written) pursuant to which any Group Company grants rights to use, license or otherwise exploit its Intellectual Property Rights or pursuant to which any Group Company is granted rights to use, license or otherwise exploit a third party’s Intellectual Property Rights;

Locked Box Date” means 1 April 2016;

Management Accounts” means the unaudited financial statements of the Group prepared on a 4, 4, 5 weekly basis each quarter for the period from the Accounts Date to 30 June 2016, copies of which are contained in the Data Room;

“MWD Side Letter” means each of the side letters addressed to each of the Warrantors, in the form agreed by Crisps Holdings Limited and the Warrantors’ Representative, delivered to each of the Warrantors (respectively) by the Purchaser on the date of this Agreement, setting out each Warrantor’s respective liability cap for which he/she will be liable pursuant to paragraph 3.1 of Schedule 2 of this Agreement;

“No Claims Declaration” shall have the meaning given to it in the W&I Policy;

Notice” has the meaning given to it in clause 10.1;

Party” means a party to this Deed and includes a reference to that party’s successors and permitted assigns and “Parties” means all of them;

Proceedings” has the meaning given to it in clause 11;

Properties” means the properties of the Group, details of which are set out in Schedule 5, and “Property” shall mean any one of them;

Purchaser’s Group” has the meaning given to it in the Sale and Purchase Agreement;

Relevant Proportion” has the meaning given to it in paragraph 3.2 of schedule 2;

Relief” means any relief, loss, exemption, allowance, set-off, deduction or credit relevant to the computation of any liability to make a payment of or relating to Tax and any right to repayment of Tax;

Representation” has the meaning given to it in clause 8.1;

 

4


Restricted Period” means the period of:

(a) 12 months after the Completion Date for Janice Bennett; and

(b) 24 months after the Completion Date for all Warrantors excluding Janice Bennett;

Sale and Purchase Agreement” means the sale and purchase agreement dated on the date of this Deed between, among others, the Warrantors and the Purchaser;

Sanctioned Country” means any jurisdiction that is subject to Sanctions;

Sanctions” means any trade sanction implemented in the European Union (including, without limitation, under Article 215 of the Treaty on the Functioning of the European Union) or appearing on the list maintained by the US Office of Foreign Assets Control (OFAC);

Saving” has the meaning given to it in paragraph 20.1 of Schedule 2;

Securities” has the meaning given to it in the Sale and Purchase Agreement;

Senior Employee” means an employee of a Group Company whose basic gross salary is in excess of £60,000 per annum or who is acting at management grade;

Shares” has the meaning given to it in the Sale and Purchase Agreement;

Subsidiaries” means the subsidiary undertakings of the Company, details of which are set out in Schedule 4;

Tax” means any tax, and any duty, contribution, impost, levy or charge in the nature of tax, and any fine, penalty, surcharge or interest connected therewith, including (without prejudice to the foregoing) corporation tax, advance corporation tax, income tax (including tax falling to be deducted or withheld from or accounted for in respect of any payment), national insurance and social security contributions, capital gains tax, inheritance tax, value added tax, customs excise and import duties, stamp duty, stamp duty reserve tax, stamp duty land tax, insurance premium tax, air passenger duty, landfill tax, petroleum revenue tax, advance petroleum revenue tax, gas levy or tonnage tax;

Tax Authority” means any Tax or other authority (whether within or outside the United Kingdom) which is competent to assess, administer or collect Tax;

Tax Policy” means the tax insurance policy contained at document 12.9 of the Data Room;

Tax Statute” means any statute, statutory instrument, decree, order, enactment, law, directive or regulation providing for or imposing any Tax;

Tax Warranty Claim” shall have the meaning given to it in Schedule 2 paragraph 1.2;

Transaction” has the meaning given to it in the Sale and Purchase Agreement;

Transaction Documents” has the meaning given to it in the Sale and Purchase Agreement;

 

5


US Transfer Agreement” has the meaning given to it in the Sale and Purchase Agreement;

VAT” means value added tax as provided for in the VATA 1994 and any other Tax of a similar nature;

VATA 1994” means the Value Added Tax Act 1994;

“W&I Insurer” means Allied World Assurance Company (Europe) Limited, the insurer of the W&I Policy;

“W&I Policy” means the warranty and indemnity policy in respect of the Transaction underwritten by the W&I Insurer;

Warrantor’s Cap” has the meaning given to it in paragraph 3.1 of Schedule 2;

Warrantor Pool has the meaning given to it in clause 1.6;

Warrantors’ Representatives” has the meaning given to it in clause 3.1; and

Warranty” means any warranty set out in Schedule 1, and “Warranties” shall be construed accordingly.

1.3 Unless the context requires otherwise, references in this Deed to:

(a) any reference to one of the genders shall include a reference to the other genders;

(b) the singular shall include the plural and vice versa;

(c) a “person” shall include a reference to any natural person, body corporate, unincorporated association, partnership and trust (in each case whether or not having separate legal personality);

(d) a “company” shall include any company, corporation, or other body corporate, wherever and however incorporated or established;

(e) any statute or statutory provision shall be deemed to include any instrument, order, regulation or direction made or issued under it and shall be construed so as to include a reference to the same as it may have been, or may from time to time be, amended, modified, consolidated, re-enacted or replaced except to the extent that any amendment or modification made after the date of this Deed would increase any liability or impose any additional obligation upon the Warrantors under this Deed;

(f) any English legal term for any action, remedy, method of judicial proceeding, legal document, legal status, statute, court, official or any legal concept or thing shall, in respect of any jurisdiction other than that of England, be deemed to include the corresponding or most similar term in that jurisdiction to the English legal term;

(g) a particular government or statutory authority shall include any entity which is a successor to that authority;

 

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(h) any time or date shall be construed as a reference to the time or date prevailing in England;

(i) material” or “materially” shall be construed as a reference to materiality in the context of the Business as a whole and references to material adverse effect on the financial position and/or financial performance of the Business as a whole; and

(j) any reference to something being “in writing” or “written” shall include a reference to that thing being produced by any legible and non-transitory substitute for writing or partly in one manner and partly in another.

1.4 The headings in this Deed are for convenience only and shall not affect its meaning. References to a “clause”, “Schedule” or “paragraph” are (unless otherwise stated) to a clause of and Schedule to this Deed and to a paragraph of the relevant Schedule. The Schedules form part of this Deed and shall have the same force and effect as if expressly set out in the body of this Deed. Any reference to this Deed includes the Schedules.

1.5 The knowledge, awareness or belief of the Purchaser (or an expression of similar import) shall be deemed to be a reference to the actual knowledge, awareness or belief of each member of the board of directors of Amplify Snack Brands, Inc. as at the date of this Deed (excluding, in each case, any implied or constructive knowledge) without making any enquiry.

1.6 Where any Warranty is qualified by the expression “so far as the Warrantors are aware” (or an expression of similar import), the knowledge, awareness or belief of each of:

(a) David Milner, Joanne Jones, Michael Hedges, Stuart Telford and Janice Bennett (together, the “Warrantor Pool”) shall be limited to (i) the facts, matters or circumstances of which each of the other members of the Warrantor Pool, Andrew Blain, Jochen Krumm and Brendan Harris is actually aware, and (ii) the knowledge of such facts, matters or circumstances a member of the Warrantor Pool would have had having made all reasonable enquiry of each of the other Warrantors and Brendan Harris at the date of this Deed; and

(b) Andrew Blain and Jochen Krumm shall be limited to (i) the facts, matters or circumstances of which he is actually aware, and (ii) the knowledge of such facts, matters or circumstances each of Andrew Blain and Jochen Krumm would have had having made all reasonable enquiry of each of the other Warrantors and Brendan Harris at the date of this Deed.

1.7 Any reference to £ is to British pounds sterling;

1.8 References in any Warranty to any monetary sum expressed in British pound sterling shall, where such sum is referable in whole or part to a particular jurisdiction, be deemed to be a reference to an equivalent amount in the local currency of that jurisdiction translated at the Exchange Rate on the date of this Deed.

1.9 Where it is necessary to determine whether a monetary limit or threshold set out in paragraph 3 or paragraph 4 of Schedule 2 has been reached or exceeded (as the case may be) and the value of the relevant Claim or any of the relevant Claims is expressed in a currency other than British pound sterling, the value of each such Claim shall be translated into British

 

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pound sterling by reference to the Exchange Rate on the date that written notification is sent to the Warrantors from the Purchaser in accordance with paragraph 2 of Schedule 2 of the existence of such Claim or, if such day is not a Business Day, on the Business Day immediately preceding such day.

1.10 A procuring obligation, where used in relation to a party to this Deed (or any one or more of them), means that such party severally undertakes to exercise its voting rights and use any and all powers vested in it from time to time as a shareholder, director, officer or employee or otherwise in or of the Company or any other member of the Group or other entity (as relevant) to ensure compliance with that obligation so far as it is reasonably able to do so, whether acting alone or (to the extent that it is lawfully able to contribute to ensuring such compliance collectively) acting with others.

2. WARRANTIES

2.1 Subject to and conditional upon Completion:

(a) each member of the Warrantor Pool severally (and not jointly or jointly and severally) warrants to the Purchaser that each Warranty is true, accurate and not misleading as at the date of this Deed; and

(b) Andrew Blain warrants to the Purchaser that in respect of the Australian Business only, each Warranty is true, accurate and not misleading as at the date of this Deed (and references in this Deed to the “Business” in respect of Andrew Blain shall be construed as relating to the Australian Business only); and

(c) Jochen Krumm warrants to the Purchaser that in respect of the German Business only, each Warranty is true, accurate and not misleading as at the date of this Deed (and references in this Deed to the “Business” in respect of Jochen Krumm shall be construed as relating to the German Business only).

2.2 Each Warranty is given subject to the Disclosed Matters and to the limitations in Schedule 2, provided that none of the provisions of Schedule 2 shall apply to any Warrantor if that Warrantor fraudulently or dishonestly makes or omits to make a disclosure in the Disclosure Letter in such a way to render any Warranty (when read with the Disclosure Letter) misleading or deceptive.

2.3 The Warranties are separate and independent and are not limited or restricted by reference to or inference from the terms of any other provision of this Deed or any other Warranties.

2.4 Subject to clause 2.1, except for the Warranties set out at paragraphs 5 and 6 of Part I of Schedule 1 each Warranty which is expressed to be given in relation to the Company shall also be deemed to be given in relation to each of the Subsidiaries as if it had been repeated to each such member naming it in place of the Company throughout.

2.5 In applying (in accordance with clause 2.4) any Warranty to any Subsidiary which is not a company incorporated in England or to any person or Property which is not located in England, any reference to any English legal term for any action, remedy, method of judicial proceeding, legal document, legal status, court, official, Tax or any legal concept of thing shall be deemed to include what most nearly approximates that English legal term in the

 

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relevant jurisdiction and any reference to any English statute, regulation, order or other statutory provision shall be deemed to include what nearly approximates that statute, regulation, order or other statutory provision in the relevant jurisdiction.

2.6 Each Warrantor agrees with the Purchaser:

(a) that the giving by any Group Company and/or any of their respective officers, employees, contractors, agents or advisers (past or present) to the Warrantors (or any of them) or their agents or advisers (past or present) of any information or opinion in connection with the Warranties or the Disclosure Documents or otherwise in relation to the business or affairs of any Group Company or in connection with the negotiation and preparation of this Deed or the Disclosure Documents shall not be deemed to be a representation, warranty or guarantee to the Warrantors of the accuracy of such information or opinion;

(b) to waive any right or claim which he may have against any Group Company and/or any of their respective officers, employees, agents or advisers for any error, omission or misrepresentation in any such information or opinion; and

(c) that any such right of claim shall not constitute a defence to any claim by the Purchaser under or in relation to this Deed.

2.7 Subject always to clause 2.1 above, the Warranties shall continue in full force and effect notwithstanding Completion.

2.8 The Purchaser confirms to the Warrantors that, apart from any Disclosed Matter, it is not aware of any fact, matter, event or circumstance which, as far as the Purchaser is aware, actually constitutes a breach of the Warranties as at the date of this Deed.

2.9 For the avoidance of doubt, no Warranty is given in relation to any information or expression of opinion, intention or expectation or any forecast or projection contained or referred to in the Disclosure Documents.

3. WARRANTORS’ REPRESENTATIVE

3.1 Each Warrantor hereby appoints David Milner and Joanne Jones, acting jointly, to be the Warrantors’ representatives (together with any replacement appointed pursuant to clause 3.3, the “Warrantors’ Representatives”) and authorises them to take all such actions (but only such actions) as this Deed expressly provides to be taken by the Warrantors’ Representatives and to receive such notices as this Deed expressly provides may be given to the Warrantors’ Representatives.

3.2 The Purchaser may rely, without enquiry, upon any action of the Warrantors’ Representatives as the act of the Warrantors in all matters referred to in this Deed as being carried out by the Warrantors’ Representatives, provided that the Parties expressly agree that the Warrantors’ Representatives shall not have the power or authority to negotiate, agree or settle any matter relating to a Claim on behalf of any Warrantor without the prior express written authorisation of that Warrantor.

3.3 The Warrantors may at any time appoint different persons to act as Warrantors’ Representatives and the Warrantors’ Representatives may elect no longer to act as such, provided that in each such case, the Warrantors appoint one or more replacements and give

 

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written notice to the Purchaser within five Business Days of such new appointment. Any person or persons from time to time appointed as a Warrantors’ Representative may be removed or replaced at any time by a majority in number of the Warrantors notifying such change in writing to the Purchaser. The Warrantors undertake that at least one Warrantors’ Representative shall be appointed at all times.

3.4 Each Warrantor agrees that the Warrantors’ Representatives owe no responsibility, duty of care or liability whatsoever in connection with their appointment as Warrantors’ Representatives and accordingly, except in the case of fraud or dishonesty, the Warrantors’ Representatives shall not be liable to any Warrantor for any act or omission in connection with the performance by them of any of their duties, functions or role as Warrantors’ Representatives pursuant to this Deed. Each Warrantor agrees not to bring any action or claim against the Warrantors’ Representatives in connection with their appointment as Warrantors’ Representatives and/or in relation to any action which the Warrantors’ Representatives have taken or omitted to take in the past or may in the future take or omit to take in their capacity as Warrantors’ Representatives, except in the case of fraud or dishonesty.

3.5 Each Warrantor covenants to pay each of the Warrantors’ Representatives an amount in respect of all losses, costs, damages, expenses (including professional fees) and any other liabilities that may be incurred by them as a result of the performance of his duties, functions and role as the Warrantors’ Representatives under this Deed, provided that the Warrantors’ Representatives shall not be entitled to any payment as a result of such covenant in respect of any matter where his actions or inactions are fraudulent or dishonest or in breach of this Deed.

4. PRESERVATION OF INFORMATION

Without prejudice to the provisions of clause 17.1 of the Sale and Purchase Agreement, the Purchaser shall, and shall procure that each member of the Group will, preserve all documents, records, correspondence, accounts and other information whatsoever which, in the reasonable opinion of the Purchaser taking into account the requirements under the W&I Policy, are relevant to a matter which may give rise to a claim under any Warranty. The obligation under this clause 4 shall cease to apply on the date which falls three years after the Completion Date except in circumstances where a Claim has been notified within the relevant time limit in which case such information shall be preserved until such date as the Claim has been settled or determined (within the meaning of paragraph 1.1 of Schedule 2).

5. PROTECTIVE COVENANTS

5.1 In order to confer upon the Purchaser the full benefit of the Business and goodwill of the Group, each Warrantor covenants severally with the Purchaser and each Group Company that he shall not during the Restricted Period directly or indirectly:

(a) (other than in accordance with the usual and ordinary course of his continuing employment with a Group Company) be engaged, concerned or interested in carrying on any business which is in direct competition with the business carried on by a Group Company at Completion in any jurisdiction in which a Group Company operates at Completion; or

(b) solicit or entice away, or offer employment to, or employ or offer to conclude any contract of services (or seek to do any of the foregoing) with any person who is at Completion a director or Senior Employee of a Group Company, whether or not such person would commit a breach of his employment contract by reason of leaving service; or

 

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(c) solicit or attempt to solicit away from a Group Company the custom or business of any firm or company who is at the Completion Date, or who has been at any time during the period of 12 months prior to the Completion Date, a material customer of a Group Company; or

(d) interfere with or seek to interfere with the continuance of supplies to any Group Company (or the terms relating to those supplies) from any supplier who is or has been supplying goods or services to any Group Company at any time during the 12 months immediately preceding the Completion Date.

5.2 The restrictions in clause 5.1(a) shall not prevent any Warrantor from holdings shares in a listed company which confer not more than 5% of the votes which could normally be cast at a general meeting of that company.

5.3 Each of the restrictions in each paragraph or sub-clause above shall be enforceable independently of each of the others and its validity shall not be affected if any of the others is invalid.

5.4 If any of those restrictions is void but would be valid if some part of the restriction were deleted, the restriction in question shall apply with such modification as may be necessary to make it valid.

5.5 The covenants in this clause may with the prior written consent of the Purchaser be enforced by any Group Company against a Warrantor under the Contracts (Rights of Third Parties) Act 1999. The provisions of this clause may be varied or terminated by agreement between a Warrantor and the Purchaser (and the Purchaser may also release or compromise in whole or in part any liability in respect of rights or claims contemplated by this clause) without the consent of any Group Company.

5.6 Each Party acknowledges that each of the restrictions in this clause 5 is no more extensive than is reasonable and necessary to protect the interests of the Purchaser as the buyer of the Securities. Each Warrantor confirms that it has received legal advice in relation to the terms of this clause 5.

6. GENERAL

6.1 Subject to clause 5.5, a variation of this Deed shall be valid only if it is in writing and signed by or on behalf of the Purchaser and the Warrantors’ Representatives.

6.2 Any payment made by a Warrantor to the Purchaser in respect of a claim under this Deed shall (to the extent legally possible) be treated by the Purchaser and such Warrantor as a reduction of the Consideration received by such Warrantor pursuant to the Sale and Purchase Agreement.

6.3 Save as otherwise provided herein or as required by law, any payment to be made by any Party under this Deed shall be made in full without any set-off, restriction, condition or deduction for or on account of any counterclaim.

 

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6.4 The liability of each of the Warrantors under this Deed is several (and not joint or joint and several) and no Warrantor shall have any liability for any act or omission of any other Warrantor.

6.5

(a) Subject to clause 6.5(c), any Group Company and/or any of its respective officers, employees, agents or advisers may enforce the terms of clauses 2.6 and 5 pursuant to the Contracts (Rights of Third Parties) Act 1999.

(b) Except as provided in clauses 5.5 and 6.5(a) the parties do not intend this Deed or any part of it to be enforceable pursuant to the Contracts (Rights of Third Parties) Act 1999 by any person who is not a party to this Agreement, but this shall not affect any other right or remedy of a third party that is available or exists apart from under that Act.

(c) Subject to clause 5.5 and notwithstanding the provisions of clause 6.5(a), the Purchaser and the Warrantors’ Representatives may agree to vary this Deed in accordance with clause 6.1 without the consent of the persons mentioned in clause 6.5(a).

6.6 Nothing in this Deed shall entitle the Warrantors to have access to any information or documents of the Purchaser which are protected by legal professional privilege or litigation privilege.

7. W&I INSURANCE

7.1 The Purchaser shall:

(a) at the date of this Deed, execute and deliver to the W&I Insurer the W&I Policy;

(b) at the date of this Deed, execute and deliver to the W&I Insurer an electronic PDF copy of the No Claims Declaration;

(c) within 20 Business Days of Completion, deliver to the W&I Insurer a CD Rom incorporating a full, indexed copy of the Data Room; and

(d) within 20 Business Days of Completion, pay the Premium (as defined in the W&I Policy) to the W&I Insurer in cleared funds.

7.2 The Purchaser irrevocably and unconditionally undertakes and covenants to the Warrantors that it shall, and shall procure that each member of the Purchaser’s Group shall, comply with all the provisions of the W&I Policy which affect the validity of the W&I Policy including, but not limited to, its obligations to:

(a) notify the W&I Insurer of any Warranty Claim or potential Warranty Claim;

(b) mitigate its loss; and

(c) maintain adequate records, in each case in accordance with the terms of the W&I Policy.

 

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7.3 The Purchaser irrevocably and unconditionally undertakes and covenants with the Warrantors that it shall, and shall procure that each member of the Purchaser’s Group shall:

(a) not take or omit to take any action which has the effect of invalidating the W&I Policy (or any Warranty Claim to which the W&I Policy relates); or

(b) not amend, vary or terminate the W&I Policy without the prior written approval of the Warrantor’s Representative.

7.4 The Purchaser shall procure that, in respect of any liability which the Warrantors may have in respect of any Warranty Claims, it shall pursue or procure the pursuit of recovery of such Warranty Claim in good faith under the W&I Policy and shall exhaust each and every right of action and remedy reasonably available to it under the W&I Policy relating to such right of recovery.

7.5 The Warrantors shall not be required to make any payment whatsoever in respect of any Warranty Claim during any period when any member of the Purchaser’s Group has a right of recovery under the W&I Policy unless and until the Purchaser has complied with its obligations under clause 7.4 and, for the avoidance of doubt, in so far as the Purchaser recovers any amount in respect of a Warranty Claim under or pursuant to the W&I Policy, the Warrantor shall have no liability under this Deed to pay any amount to the Purchaser or any other member of the Purchaser’s Group in respect of the deductible which the Purchaser has not been able to so recover. For the avoidance of doubt, nothing in the preceding sentence of this clause 7.5 shall limit or prejudice the Purchaser’s ability to give a notice of Claim in accordance with the provisions of paragraph 2 of Schedule 2.

7.6 If the W&I Policy should lapse or cease to provide (or the Warrantors reasonably believe that it shall cease to provide) by reason of the likely, pending or actual insolvency of the W&I Insurer, the relevant insurance coverage at any time the Purchaser shall provide the Warrantors with all assistance (at the cost of the Warrantors) as they may reasonably require to source and place a substitute policy (at the cost of the Warrantors) in respect of such required coverage.

7.7 The Purchaser shall procure that, during the policy term of the W&I Policy, any person that acquires more than 50% of the assets (based on fair market value) of the Group to whom the Purchaser assigns its rights or interest or transfers its obligations under the W&I Policy shall adhere to the terms of this Deed.

8. ENTIRE AGREEMENT

8.1 In this clause 8, the following definition applies:

Representation” means an assurance, commitment, condition, covenant, guarantee, promise, forecast, indemnity, representation, statement, undertaking or warranty of any sort whatsoever (whether contractual or otherwise, oral or in writing, implied or otherwise, or made negligently or otherwise).

8.2 This Deed and the other Transaction Documents constitute the whole agreement between the Parties about the subject matter of this Deed and in relation to such subject matter, supersede any arrangements, understanding or previous agreement between the Parties and all earlier Representations by any Party.

 

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8.3 The Parties acknowledge that in entering into this Deed no party has relied on, and no party shall have any remedy in respect of, any Representation other than as expressly set out in this Deed or any of the other Transaction Documents.

8.4 Nothing in this Deed shall have the effect of limiting or excluding any liability arising from fraud.

9. ASSIGNMENT

9.1 Except as provided in this clause 9, no Party may assign, transfer, declare a trust of the benefit of or in any other way alienate any of its rights under this Deed whether in whole or in part without the consent of the Warrantors’ Representatives (in respect of any assignment by the Purchaser) or the Purchaser (in respect of any assignment by a Warrantor). Any purported assignment in contravention of this clause 9 shall be void.

9.2 The Purchaser may assign (in whole or in part) the benefit of this Deed to any other member of the Purchaser’s Group, provided that if such assignee ceases to be a member of the Purchaser’s Group, all benefits relating to this Deed assigned to such assignee shall be deemed automatically by that fact to be re-assigned to the agreement immediately before such cessation.

9.3 The Purchaser or any member of the Purchaser’s Group may charge and/or assign (in whole or in part) the benefit of this Deed to any person providing debt financing and/or hedging facilities to the Purchaser or any member of the Purchaser’s Group or to any security agent or any person or persons acting as trustee, nominee or agent for any such person by way of security for the facilities being made or to be made available to the Purchaser or member of the Purchaser’s Group and any such person, security agent, trustee, nominee or agent may also, in the event of enforcement of such security in accordance with its terms, assign the benefit of such obligations and rights to a purchaser or assignee who acquires the Company or all or part of its business from that person, security agent, trustee, nominee or agent (or any receiver appointed by any of them).

9.4 If an assignment is made in accordance with this clause 9, the liabilities or obligations of the Parties under this Deed shall be no greater than such liabilities or obligations would have been had the assignment not occurred.

10. NOTICES

10.1 A notice or other communication under or in connection with this Deed (a “Notice”) shall be:

(a) in writing;

(b) in the English language; and

(c) delivered personally by hand or sent by first class post or pre-paid recorded delivery (or air mail if overseas) or by email to the Party due to receive the Notice to:

(i) in the case of the Purchaser, at the following address: 500 West 5th St., Suite 1350, Austin, TX 78701, marked for the attention of Tom Ennis and copied to Richard Lever (RLever@goodwinlaw.com) (such copy not in itself constituting valid service of such notice);

 

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(ii) in the case of a Warrantor, either:

(A) the relevant address set out in column (2) of Schedule 3 and copied to the Warrantors’ Representatives and Travers Smith LLP, 10 Snow Hill, London EC1A 2AL marked for the attention of Ian Shawyer (ian.shawyer@traverssmith.com) and Lucie Cawood (lucie.cawood@traverssmith.com) (such copies not in themselves constituting valid service of such notice); or

(B) to the Warrantors’ Representatives at the relevant address set out in column (2) of Schedule 3 and copied to Travers Smith LLP, 10 Snow Hill, London EC1A 2AL marked for the attention of Ian Shawyer (ian.shawyer@traverssmith.com) and Lucie Cawood (lucie.cawood@traverssmith.com) (such copy not in itself constituting valid service of such notice); or

(iii) another address or person specified by that Party by not less than seven days’ written notice to the other parties received before the Notice was despatched.

10.2 Unless there is evidence that it was received earlier, a Notice is deemed given if:

(a) delivered personally, when left at the address referred to in clause 10.1(c) above;

(b) sent by mail, except air mail, two Business Days after posting it;

(c) sent by air mail, six Business Days after posting it; and

(d) sent by email, when the email is sent, provided that a copy of the Notice is sent by another method referred to in this clause 10 within three Business Days of sending the email, provided that in each case where delivery by hand occurs after 6:00 p.m. on a Business Day or a day which is not a Business Day, service shall be deemed to occur at 9:00 a.m. on the next following Business Day.

10.3 Service of any notice or other communication on the last known Warrantors’ Representatives shall be deemed to constitute valid service thereof on all or any of the Warrantors.

10.4 This clause 10 shall not apply in relation to the service of any claim, form, notice, order, judgment or other document relating to or in connection with any Proceedings.

11. AGENT FOR SERVICE

Each of Andrew Blain and Jochen Krumm irrevocably appoints the Warrantors’ Representatives as his agent to receive and acknowledge on its behalf service of any writ, summons, order, judgment or other notice in connection with any proceeding, suit or action arising out of or in connection with this Deed in England and Wales (“Proceedings”) and the Warrantors’ Representatives agree to provide notice to Andrew Blain and/or Jochen Krumm (as applicable) informing them that such service documents have been issued in connection with Proceedings following receipt and copies of such documentation. If the agent named above (or its successor) at any time ceases for any reason to act as such or have an address in England or Wales, each of Andrew Blain and Jochen Krumm shall appoint a replacement

 

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agent having an address for service in England or Wales and shall notify the Purchaser of the name and address of the replacement agent. Failing such appointment and notification, the Purchaser shall be entitled by notice to the Warrantors’ Representatives to appoint a replacement agent to act on behalf of Andrew Blain and Jochen Krumm. This clause 11 applying to service on an agent applies equally to service on a replacement agent. Each of Andrew Blain and Jochen Krumm further agrees that any Proceedings shall be sufficiently served on him if delivered to such agent for service at its address for the time being in England or Wales whether or not such agent gives notice thereof to Andrew Blain and Jochen Krumm.

12. UNITED STATES TAX COOPERATION

The Warrantors shall after the date hereof and prior to the Completion Date provide such information and assistance as the Purchaser may reasonably request so as to determine (i) the tax basis, for U.S. federal income tax purposes, of any “United States property” (as defined in Section 956(c) of the Code) of the Company and the Subsidiaries and/or (ii) the projected amount of “subpart F income” as defined in Section 952 of the Code that shall have arisen to the Company and the Subsidiaries as of the Completion Date.

13. INVALIDITY

If any provision of this Deed is held to be illegal, invalid or unenforceable, in whole or in part, the provision shall apply with whatever deletion or modification is necessary so that the provision is legal, valid and enforceable and gives effect to the commercial intent of the Parties. Subject to the previous sentence, the illegality, invalidity or unenforceability of any provision of this Deed shall not affect the validity or enforceability of any other provision of this Deed.

14. DELIVERY

This Deed is delivered on the date written at the start of this Deed.

15. COUNTERPARTS

This Deed may be executed in any number of counterparts, each of which when executed and delivered is an original and all of which together evidence the same agreement.

16. GOVERNING LAW AND JURISDICTION

16.1 This Deed and all non-contractual or other obligations arising out of or in connection with it are governed by and construed in accordance with English law.

16.2 The courts of England have exclusive jurisdiction to settle any dispute arising from or connected with this Deed (a “Dispute”) including a dispute regarding the existence, validity or termination of this Deed, relating to any non-contractual or other obligation arising out of or in connection with this Deed or the consequences of its nullity.

16.3 The Parties agree that the courts of England are the most appropriate and convenient courts to settle any Dispute and, accordingly, that they will not argue to the contrary.

 

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SCHEDULE 1

WARRANTIES

 

I Constitution and Corporate Structure

 

II Accounts

 

III Assets

 

IV Liabilities and Grants

 

V Trading Arrangements

 

VI Compliance and Litigation

 

VII Insolvency

 

VIII Intellectual Property and Information Technology

 

IX Officers and Employees

 

X Pensions

 

XI Property

 

XII Environment

 

XIII Food Matters

 

XIV Tax

 

XV Related Party Transactions

 

XVI Other Agreements

 

XVII Data Protection

Part I – Constitution and Corporate Structure

1. Memorandum and articles of association

The copy of the memorandum and articles of association of the Company contained in the Disclosure Documents are accurate and complete and set out in full the rights and restriction attaching to the shares.

2. Register of members

The register of members of the Company contained in the Disclosure Documents contains an accurate and complete record of the current members of the Company and the Company has not received any written notice (which is still current) that the register is incorrect or incomplete or should be rectified.

 

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3. Statutory books and records

The statutory books and records of the Company are up to date, in its possession or control, are a complete and accurate record, in all material respects, of all matters required by Applicable Law to be recorded or registered therein. The Company has not received any written notice (which is still current) that any of them is incorrect or incomplete or should be rectified.

4. Compliance

4.1 Due compliance has been made with the constitutional documents of the Company, the Acts and all other Applicable Law in connection with:

(a) the formation of the Company;

(b) any allotment, issue, purchase or redemption of shares, debentures or other securities in the Company;

(c) any reduction of the authorised or issued share capital of the Company;

(d) any amendment to the memorandum or articles of association of the Company;

(e) the passing of any resolutions by the Company;

(f) the payment of any dividends or other distributions by the Company; and

(g) any financial assistance in connection with any acquisition of the Company’s share capital or the share capital of its holding company.

4.2 All resolutions, annual returns/confirmation statements and other documents required to be delivered to the Registrar of Companies or to any other governmental or regulatory body or to any local authority have been properly prepared in accordance with Applicable Laws and filed and are true and complete.

5. Company and Subsidiaries

5.1 Each Group Company is duly incorporated and validly exists under the laws of its jurisdiction of incorporation and has all requisite power and authority to own, lease and operate the properties and assets it now owns, leases and operates and to carry on its business.

5.2 The Subsidiaries are the only subsidiary undertakings of the Company.

5.3 The entire issued share capital of the Subsidiaries are legally and beneficially held by the Company (or a Subsidiary) free from all Encumbrances.

5.4 Other than the Subsidiaries, the Company does not own (and has not agreed to acquire) any shares, securities, debentures or other interest in the capital of any other company, in each case whether directly or indirectly.

5.5 The information in Schedule 4 of this Deed is complete and accurate in respect of each of the Group Companies.

 

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5.6 The Data Room contains complete and accurate details of the terms of any share and business acquisitions and disposals undertaken by a Group Company in the last six years and no Group Company has any outstanding liability in respect of such acquisition or disposal (including any deferred consideration and/or other price adjustment mechanisms).

6. Share Capital

6.1 Following the Reserved Share Allocation and the Deferral Process, the Shares will represent the entire allotted and issued share capital of the Company.

6.2 Other than pursuant to the Transaction Documents, the Reserved Share Allocation and the Deferral Process, no person has the right to call for the allotment, conversion, redemption, issue, sale or transfer of any of the Shares or the share or loan capital or other securities of the Company or any Subsidiary.

6.3 The Shares and the shares in each Subsidiary have been properly and validly allotted and issued and are each fully paid.

6.4 All of the shares or interests, as the case may be, issued by a Group Company at any given time were subscribed or transferred or otherwise disposed of at a price equal to at least their unrestricted market value at the time of their issue or transfer. All contributions have been made in compliance with Applicable Laws and have not been repaid or returned, in whole or in part, whether open or disguised, directly or indirectly, and there have been no payments or transactions in breach of Section 30 of the German Limited Liability Companies Act (Gesetz betreffend die Gesellschaften mit beschränkter Haftung) or similar law applicable to any Group Company. There are no obligations to make further contributions.

7. Powers of Attorney

The Company has not delegated any powers under a power of attorney which remains in effect and no person has authority (express or implied) to enter into any contract or commitment or to do anything on behalf of the Company (other than any ostensible or implied authorities to directors or employees and consultants to enter into routine contracts in the normal course of their duties).

Part II – Accounts

1. General

1.1 The Accounts show a true and fair view of the:

(a) financial position and state of affairs as at the Accounts Date; and

(b) profits/losses for the financial year ended on the Accounts Date, of the Group.

1.2 The Accounts have been prepared:

(a) in accordance with International Financial Reporting Standards or International Accounting Standards issued or adopted by the International Accounting Standards Board (or a predecessor body) and interpretations issued by the IFRS

 

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Interpretations Committee (or a predecessor body) as and to the extent from time to time adopted by the European Commission under EC Regulation No. 1606/2002 (“Accounting Standards”) consistently applied and comply in all respects with the requirements of the Acts; and

(b) on the same basis and in accordance with the same Accounting Standards, consistently applied, with those adopted in preparing the audited accounts for the previous two accounting periods of the Group.

1.3 The profit and losses shown in the Accounts have not been affected by any unusual or non-recurring income or expenditure (except as therein disclosed).

1.4 The Warrantors were not at the relevant time and are not aware of any liability which existed at the Accounts Date and which, pursuant to the Accounting Standards, was not permitted or required to be provided for or disclosed in the Accounts.

1.5 The audited accounts of the Company for each of the two consecutive accounting periods ending on the Accounts Date have not contained any misstatement that caused such accounts to fail to provide a true and fair view of the financial position and state of affairs of the Company at the date of such accounts and of the profits and losses for the periods covered by such accounts. Those accounts have not been restated or revised since being duly filed with the Registrar of Companies.

2. Management Accounts

The Management Accounts:

2.1 show with reasonable accuracy:

(a) the financial position and state of affairs of the Company as at the date to which they have been prepared; and

(b) the Company’s profits and losses for the period in respect of which they have been prepared;

2.2 have been prepared on the same basis and in accordance with the same Accounting Standards, consistently applied, with those adopted in preparing the Management Accounts for the previous two accounting periods; and

2.3 are not affected by any unusual or non-recurring item.

3. Business since the Accounts Date

Since the Accounts Date:

3.1 the Company has carried on its business in the ordinary and usual course and so as to maintain the Business as a going concern without any material alteration in its nature or manner;

3.2 no distribution of capital or income has been authorised, declared, made or paid by the Company;

 

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3.3 no resolution of the Company’s shareholders has been passed;

3.4 the Company has not: (i) repaid or redeemed any share or loan capital; or (ii) incurred any indebtedness, liabilities or obligations of any nature (except those that have been incurred since the Accounts Date in the ordinary and usual course of business consistent with past practice);

3.5 the Company has traded at a profit and there has been no material adverse change in the financial or trading position of the Company and, so far as the Warrantors are aware, no fact, matter, event or circumstance has occurred which is likely to give rise to any such change;

3.6 the Company has not disposed of or acquired, or agreed to dispose of or acquire, any material asset or interest in any material asset other than in the ordinary and usual course of business consistent with past practice in the last 12 months;

3.7 the Company has not entered into, or agreed to enter into, any capital commitments exceeding £100,000 other than in the ordinary and usual course of business consistent with past practice;

3.8 there has been no unusual increase in the level of the stock or work-in-progress of the Company; and

3.9 the Company has not lent any money which have not been repaid other than in the ordinary and usual course of business consistent with past practice in the last 12 months.

Part III – Assets

1. Ownership

1.1 The Company either owns (legally and beneficially, free from Encumbrances other than liens arising in the ordinary course of business or by operation of law) or has a legally binding right to use all assets necessary for the operation of the Business, as currently carried on.

1.2 The Fixed Asset Register is annexed to the Disclosure Letter and sets out a materially accurate record of the material plant, machinery, vehicles and equipment owned by the Company (“Equipment”).

2. Possession

2.1 All of the assets necessary for the operation of the Business owned by the Company or in respect of which the Company has a legally binding right of use are, in each case, used exclusively by the Company and are in the possession by and under the control of the Company.

2.2 The Business does not depend on the use of assets owned by or facilities or services provided by any of the Sellers (as defined in the Sale and Purchase Agreement).

 

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3. Condition

All material assets (including Equipment) are, subject to fair wear and tear, in satisfactory working condition and state of repair, are capable of being used for the purpose for which they are currently being used by the Company and operate in all material respects in conformity with all Applicable Laws (including safety regulations) and have been reasonably maintained and none are dangerous, hazardous to health or, so far as the Warrantors are aware, in need of renewal, upgrading or replacement.

4. Hire purchase and leased assets

Copies of any material bill of sale or any hiring or leasing agreement, hire purchase agreement, credit or conditional sale agreement, option to purchase, agreement for payment on deferred terms or any other similar agreement to which the Company is a party are contained in the Disclosure Documents, and the Company has complied with the terms of such agreements in all material respects.

5. Debts

5.1 Other than in the ordinary course of business consistent with past practice, in the last 12 months the Company has not engaged in any borrowing or financing not required to be reflected in the statutory accounts.

5.2 The Company has not factored, sold or discounted any of its debts.

5.3 A copy of the Company’s schedule of aged debts as at 1 April 2016 is appended to the Disclosure Letter and is complete and accurate in all material respects.

5.4 The Company has not granted credit terms exceeding 30 days from the end of the month in which the invoice is issued.

5.5 No material amount owing by the Company to any business or other creditors is overdue for payment.

6. Insurance

6.1 A complete and accurate list of all insurance policies in respect of which the Company has an interest (the “Policies”) is included in the Disclosure Documents. All such Policies are in full force and effect, all premiums due and payable under them have been duly paid, and the Company has not received written notice that it has done or omitted to do anything which might make any of such policies void, voidable, invalid or unenforceable.

6.2 All material Policies in respect of which the Company has an interest are Disclosed.

6.3 No claims have been made by or on behalf of the Company under any of the Policies in the last twelve months and no insurance claims are outstanding.

6.4 So far as the Warrantors are ware, there are no circumstances which have given rise to any claim or require notification under any of the Policies which have not been notified to the relevant insurers.

 

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6.5 No insurer has in the last three years cancelled or refused to accept or continue any insurance in relation to the Company. So far as the Warrantors are aware, there are no circumstances existing which are likely to result in the renewal of any of the Policies being refused.

Part IV – Liabilities and Grants

1. Facilities

Details of all overdrafts, loans, loan notes and other financial facilities or indebtedness in the nature of borrowings currently outstanding or available to the Company (other than trade indebtedness incurred in the ordinary and usual course of business) are Disclosed and, so far as the Warrantors are aware, nothing has been done or omitted to be done whereby the continuance of any such facilities in full force and effect will be prejudiced (save as provided for under the Transaction Documents).

2. Guarantees and indemnities

Save in the ordinary and usual course of trading, there is not outstanding any Encumbrance, guarantee, indemnity, security, bond, letter of credit, letter of comfort or other similar obligation given by or for the benefit of the Company.

3. Events of default

No written notice (which is still current) has been received by the Company to the effect that the Company is in default under the terms of any borrowing currently made by it.

4. Grants

4.1 The Disclosure Documents set out full details of all investment grants received by the Company and all other grants or loans received from any governmental department or agency or any local or other authority in the last 10 years or which are capable of being clawed back (“Grants”).

4.2 The Company is not, and has not been, in default of any condition on which any of the Grants has been provided to the Company and, so far as the Warrantors are aware, there are no facts or circumstances which could result in the Company being required to refund in whole or in part any of the Grants.

Part V – Trading Arrangements

1. Undertakings

The Company is not subject to any order of, and in the last 5 years has not given any undertaking to, the Office of Fair Trading, the Competition Commission, the Secretary of State for Trade and Industry or the European Commission (or any other government body, agency, authority, tribunal or court having jurisdiction in competition or anti-trust matters), nor has the Company in the last 5 years received any written notice from any of the aforementioned bodies or persons that it is subject to investigation by them.

 

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2. Suppliers

2.1 During the last six months, no material supplier has ceased supplying the Company nor has any material supplier notified the Company in writing that it will (i) cease supplying the Company, or (ii) materially reduce its supplies to the Company, or (iii) change the terms of trading with the Company, or (iv) materially increase prices, commissions, margins or trade discounts payable or given by the Company.

2.2 No material supplier has notified the Company in writing that it will terminate its supply arrangements with the Company as a result of the Transaction, and no material supplier is contractually entitled to do so.

2.3 There are no claims pending or threatened by the Company against any material supplier nor has the Company received any written notice of any claim pending or threatened by any material supplier against the Company.

3. Customers

3.1 During the last six months, no material customer has ceased trading with the Company nor has any material customer notified the Company in writing that it intends to (i) cease trading with the Company, or (ii) materially reduce its custom with the Company, or (iii) change the terms of trading with the Company.

3.2 No material customer has notified the Company in writing that it will terminate its arrangements with the Company as a result of the Transaction, and no material customer is contractually entitled to do so.

3.3 There are no material claims pending or threatened by the Company against any material customer nor has the Company received any written notice of any pending or threatened claim by any material customer against the Company.

3.4 The Company has not given, paid or received (or agreed to give, pay or receive) any discount, volume rebates, allowances, commission payments or the like (whether or not legally binding) to any of its material customers.

4. Material contracts

4.1 Complete and accurate copies of all material contracts have been Disclosed.

4.2 Each material contract has been duly authorized and is a valid and binding agreement of, and enforceable by, the Company and is in full force and effect (assuming due and valid authorisation, execution and delivery by each other party to such agreements). Neither the Company nor, so far as the Warrantors are aware, any other party thereto is in material default of, or breach under, the terms of any such material contract, nor has any event occurred or not occurred through the Company’s or, so far as the Warrantors are aware, a third party’s action or inaction which, with the giving of notice or the lapse of time or both, would constitute a default by such person under, any material contract.

 

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5. Standard terms

Copies of the Company’s standard terms upon which it does business with customers, suppliers and distributors are Disclosed.

6. Onerous and unusual contracts

6.1 The Company is not, nor has agreed to become, a party to, bound by or liable under, any agreement or arrangement (written or otherwise) which:

(a) is not on arm’s length commercial terms in the ordinary and usual course of its business;

(b) limits or excludes it right to do business and/or compete in any geographical area or field or with any person;

(c) cannot be readily fulfilled or performed by it on time without undue or unusual expenditure or application of money, effort or personnel, or is reasonably likely to result in a loss to it on completion of performance;

(d) is of a long term nature, being:

(i) for a fixed term of 12 months or more; or

(ii) or an indefinite term which cannot be terminated by it in accordance with its terms on 90 days’ notice or less without compensation.

7. Defective products

7.1 So far as the Warrantors are aware:

(a) there is no claim outstanding and there are no circumstances which may reasonably be expected to lead to any claim, against the Company for faulty, defective or dangerous goods, services, work or materials or for breach of representation, warranty or condition or for delays in delivery or completion of contracts or for deficiencies of design or performance or otherwise relating to liability for goods or services sold or supplied by or on behalf of the Company;

(b) the Company has not agreed to produce or deliver replacement goods or perform replacement or additional services after the date of this Deed or to take back any goods (whether defective or not) or reimburse the cost of any services or to effect modifications to the same free of charge or otherwise than at arm’s-length rates or to issue a credit note, money-back guarantee or write-off or reduce indebtedness in respect thereof;

(c) there have been no complaints, returns or claims made in relation to any product or ingredient supplied or sold by the Company in the last 5 years other than non-material customer complaints arising in the ordinary course of a business of the nature of the Business;

(d) there have been Disclosed all material details of all correspondence between the Company and any regulatory body (such as, but not limited to, the Food Standards Agency and/or the Trading Standards Institute) in the last 5 years in each case in relation to

 

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any claims, allegations or findings that the products and/or ingredients sold or supplied by the Company have not complied with Applicable Law or were otherwise unsafe or unsuitable; and

(e) the Company has not carried out (nor have there been any incidents which have required the Company to carry out) any product recall exercise during the last 5 years.

8. Partnerships

The Company does not act or carry on business in partnership with any other person, is not a member (other than as a shareholder) of any corporate or unincorporated body, undertaking or association. There are no silent participants or partnerships that participate in the profits of any the Company.

Part VI – Compliance and Litigation

1. Compliance with laws

1.1 In the last 5 years, the Company has complied, in all material respects, with all Applicable Law. The Company has not, in the last 12 months, received any written notice stating that the Company is not currently in material compliance with all Applicable Law or any judgments given by any court, arbitrator or government authority.

1.2 Neither the Company nor, so far as the Warrantors are aware, any current and former officers and employees of the Company have engaged in any activity, practice or conduct which would constitute an offence under anti-bribery and anti-corruption laws (“Anti-Corruption Laws”) in any jurisdiction in which the Business is carried on. The Company has in place adequate policies and procedures designed to ensure compliance by the Company and its officers and employees for the time being with all Anti-Corruption Laws.

1.3 The Company is not:

(a) carrying and has not carried on any business, whether directly or indirectly, with any person:

(i) who is subject to Sanctions and/or resident in any Sanctioned Country; or

(ii) which is owned or controlled by any governmental or regulatory authority of a Sanctioned Country or any person falling within sub-paragraph 1.3(a)(i) above; and

(b) facilitating and has not facilitated any business with any person falling within either of sub-paragraph (a) or (b) above.

2. Licences and consents

2.1 The Company holds all licences, consents, approvals, permissions, permits, certificates, qualifications, registrations and other authorisations (public and private) necessary for the operation of the Business in the places and in the manner as carried on in the 12 months preceding the date of this Deed (together the “Authorities”).

 

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2.2 All of the Authorities are in full force and effect and have been complied with in all material respects, and the Warrantors are not aware of any circumstance which indicates that any such Authority is likely to or may be quashed, varied, suspended, revoked, withdrawn or not renewed whether as a consequence of Completion or otherwise.

3. Litigation

3.1 The Company is not involved in any ongoing and it has not received written notice of any pending or threatened (i) material civil, criminal, arbitration, administrative or employment-related proceedings or (ii) other material investigation, formal enforcement action before any court, arbitrator or governmental authority, and, so far as the Warrantors are aware, none is pending or threatened.

3.2 There is no judgment, award, order, decision or contractual settlement payment outstanding or pending against the Company or its assets.

3.3 No Group Company has given any assurances or undertakings in writing (whether legally binding or not) to any authority, regulator or regulatory body.

4. Directors and officers

4.1 None of the directors or officers of the Company:

(a) has been convicted of any criminal offence or been subject to any criminal proceedings (except convictions for, or proceedings relating to, minor motoring offences);

(b) has been subject to any order made under the Company Directors Disqualification Act 1986;

(c) has been censured by the London Stock Exchange, the FSA, the FCA, the PRA, any other recognised investment exchange (whether privately or publicly) or by any governmental or quasi-government department, agency or body;

(d) has been declared bankrupt or entered into a voluntary arrangement with his creditors;

(e) has, in the last 5 years, been investigated in relation to breaches of competition law; or

(f) has been subject to any proceedings brought in respect of a breach or alleged breach of any of the provisions of chapter 2 of Part 10 of the Companies Act 2006 (Duties of Directors).

Part VII – Insolvency

1. Receivership

No receiver or administrative receiver has been appointed in respect of the whole or any part of the assets or undertaking of the Company. The Company has not received written notice of any resolution to be liquidated or dissolved nor any action or request to accomplish such liquidation or dissolution.

 

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2. Administration

2.1 The Company is not:

(a) the subject of an administration order, nor has a resolution been passed by the directors or shareholders for the presentation of an application for such an order nor has an application for such an order been presented or come into force;

(b) subject to a resolution passed by the directors or the shareholders for notice of intention to appoint an administrator or notice of appointment of an administrator to be filed with the court, nor has a notice of intention to appoint an administrator or notice of appointment of an administrator been filed with the court by the holder of a qualifying floating charge, by the Company or its directors.

3. Compromises

No voluntary arrangement, compromise or scheme of arrangement between the Company and its creditors (or any class of them) has been proposed by the Company.

4. Winding-up

4.1 The Company has not presented any winding-up petition, nor has it received written notice of any winding-up petition having been presented against the Company by any third party.

4.2 The Company has not been the subject of a resolution for voluntary winding-up nor has a meeting of its shareholders been called to consider a resolution for winding-up.

4.3 The Company has not taken, or has been subject to any step taken with a view to its dissolution or strike-off.

5. Payment of debts

The Company is not insolvent or unable to pay its debts within the meaning of section 123 (1) or (2) of the Insolvency Act 1986.

6. Distress

The Company has not, in the last 5 years, received notice in writing that distress, forfeiture, re-entry, execution or other process has been levied, enforced or threatened on any of its assets.

7. Voidable transactions

7.1 The Company has not:

(a) been party to any transaction at an undervalue (within the meaning of section 238 of the Insolvency Act 1986) nor has it given or received any preference (within the meaning of section 239 of the Insolvency Act 1986) in either case during the two years preceding the date of this Deed;

 

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(b) acquired any interest in property (or any interest deriving from such interest) within the meaning of section 238 or 239 of the Insolvency Act 1986 during the five years preceding the date of this Deed;

(c) been party to any transaction at an undervalue (within the meaning of section 423(1) of the Insolvency Act 1986) for either of the purposes mentioned in section 423(3) of the Insolvency Act 1986 during the five years preceding the date of this Deed; or

(d) been party to any extortionate credit transaction (within the meaning of section 244 of the Insolvency Act 1986) during the three years preceding the date of this Deed.

Part VIII – Intellectual Property and Information Technology

1. Ownership of IPR

1.1 Schedule 6 contains an accurate and complete list of all registered Intellectual Property Rights (and applications for such rights) and details of material unregistered Intellectual Property Rights owned by the Company (the “Listed Intellectual Property”).

1.2 In the last 5 years, the Company has not received written notice to indicate that any Listed Intellectual Property is being challenged or attacked by any third party or by any relevant registry and all fees payable in respect of the registrations/applications have been paid.

1.3 There are no Intellectual Property Rights necessary for carrying on the Business other than:

(a) Intellectual Property Rights of which the Company is sole legal and beneficial owner free from Encumbrances; and

(b) Intellectual Property Rights which the Company is permitted to use pursuant to an IPR Agreement.

2. Infringements

2.1 So far as the Warrantors are aware, none of the Intellectual Property Rights owned by the Company are being, or have been, infringed.

2.2 The Company is not infringing or making unauthorised use of, nor has it infringed or made unauthorised use of, any Intellectual Property Right owned by a third party and in the last 5 years the Company has not received any written notice alleging such infringement or unauthorised use.

3. IPR Agreements

3.1 Complete and accurate copies of all written IPR Agreements material to the Business have been Disclosed to the Purchaser, and where a material IPR Agreement is not in writing, full details of the terms of such IPR Agreement have been Disclosed to the Purchaser.

3.2 The Company is not, and, so far as the Warrantors are aware, no counterparty to any of the IPR Agreements which are material to the Business is, in default of such IPR Agreements. There have been no disputes relating to or arising out of any such IPR Agreements in the 5 years preceding the date of this Deed.

 

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4. Confidential Information

4.1 So far as the Warrantors are aware, all Confidential Information has been kept strictly confidential and has not been disclosed otherwise than subject to an obligation of confidentiality on the person to whom it was disclosed and subject to an obligation on that person not to use the Confidential Information other than for the purpose for which it was disclosed.

4.2 The Company is entitled to use all Confidential Information in its possession to the extent legally permitted.

5. Information Technology

5.1 Material details of the Information Technology Systems have been Disclosed.

5.2 The Company is the sole legal and beneficial owner free from any Encumbrances or has all necessary licences and consents (which are in full force and effect) to use the Information Technology Systems, and the Company does not license or sub-license the right to use any such Information Technology Systems to any person.

5.3 The Information Technology Systems are substantially adequate for the current information technology requirements of the Company.

5.4 The Information Technology Systems perform materially in accordance with their specifications and do not contain any defect or feature (other than normal errors in off-the-shelf software) which has a material adverse effect on their performance. There has been no disruption of 48 hours or more to the Information Technology Systems in the last 3 years

5.5 So far as the Warrantors are aware, no material capital expenditures with respect to the Information Technology Systems are necessary to continue use of the Information Technology Systems in the manner they are used as at the date of this Deed.

Part IX – Officers and Employees

In this Part IX any reference to “Consultants” will be deemed to include (but not be limited to) all independent contractors, consultants and workers but shall not include employees.

1. Particulars

1.1 Those persons named as such in Schedule 4 are the only persons currently appointed to the board of directors and/or to the office of secretary of the any member of the Group and there is no person who is a shadow director of any member of the Group. Copies of the terms and conditions upon which the Warrantors provide their services to the Company have been Disclosed and such particulars are true, accurate and not misleading.

1.2 Other than as set out in the Data Room, there are no other persons employed by the Company or who are providing services to or assigned to the Company or the Business (whether directly, through an agency, services company or otherwise), or who will transfer to, or become the responsibility of (in whole or in part), a member of the Purchaser’s Group upon Completion.

 

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1.3 The Data Room contains the following particulars in relation to each employee (or, where appropriate, to each category of employee) whose basic annual salary exceeds £60,000 (the “Employees”):

(a) job title or job function, job grade, salary, notice periods, restrictive covenants, and holiday entitlements; and

(b) the terms of any bonus scheme, share option scheme, commission scheme, benefits under incentive schemes or other benefits in which any of the Employees participate, and all such particulars are true, accurate and not misleading.

1.4 The Company has not given any commitment (whether legally binding or not) to make any future change in the remuneration or benefits of any of the Employees other than salary or wage increases in the ordinary course of business.

1.5 The material terms of employment of each Employee have been Disclosed in the Data Room, and all such particulars are true, accurate and not misleading. All written policies and procedures (whether contractual or not) applicable to the employees have been Disclosed.

1.6 Standard form contracts of employment for all employees of the Company are Disclosed and there are no employees of the Company (other than the Employees) employed on terms which are materially different.

1.7 Copies of all contracts for services and full particulars of the current terms and conditions of engagement of all Consultants have been Disclosed and all of such particulars are true, accurate and not misleading.

1.8 The Company has not offered to any person any contract of employment or engagement or contract for services with a basic annual salary exceeding £60,000, and it has no such contract of employment or engagement or contract for services with any of the Employees or any other person, the terms of which are yet to take effect; and/or include a notice period of more than six months; and/or require the Company to make any payment or impose any liability on the Company (besides salary or pension for the notice period) on or as a result of termination.

1.9 Other than any entitlement to Consideration pursuant to clause 2.1 of the Sale and Purchase Agreement, where relevant, no employee or Consultant will become entitled to receive a payment by virtue of Completion of this Transaction.

1.10 No person (other than a person who is director, officer, employee or shareholder of Investcorp Securities Limited), is entitled to participate in any share incentive, share option, share trust, profit sharing, bonus or other incentive arrangement or any scheme entitling any person to a bonus, commission or remuneration of any sort calculated by reference to turnover, profit, sales or performance of the Company or as a result of the Transaction.

1.11 There are no outstanding dismissal or disciplinary procedures or formal grievances or appeals under such procedures concerning any of the Employees or any person previously employed or engaged by the Company.

 

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1.12 There have been no protected disclosures made to the Company by any employee, ex-employee or any other person who has worked for or provided services to the Company.

2. Compliance

2.1 The Company has complied in all material respects with all Applicable Laws in respect of the employees and Consultants and/or arising out of their terms and conditions of employment or provision of services and no amount due to or in respect of any employee is in arrear and unpaid other than salary for the month current at the date of this Deed, and no material liability has been incurred by the Company which remains undischarged in respect of them.

2.2 Without prejudice to the generality of the preceding paragraph, the Company has in respect of each of the employees and Consultants performed and complied with all obligations and duties required to be performed by it under the Working Time Regulations 1998 (including for the avoidance of doubt the obligations imposed by prevailing UK and European case law in relation to the calculation of holiday pay) and maintained adequate and suitable records regarding the service and working time of each employee.

2.3 Without prejudice to the generality of paragraph 2.1, the Australian Subsidiaries have complied in all respects with their obligations to employees and all former employees under any modern award or enterprise agreement or other industrial instrument or improvement or prohibition notice in respect of their employees.

3. Notice

No Employee or Consultant has given or received notice terminating his employment or engagement, and no such person is contractually entitled or, so far as the Warrantors are aware, intends to terminate such employment or engagement as a result of the parties entering into the Sale and Purchase Agreement.

4. Trade unions

There is no recognition or collective bargaining agreement between the Company and any trade union in relation to or in respect of any bargaining unit of which any of the employees form part. No trade union has made a request for recognition or made any application to the Central Arbitration Committee in relation to or connected with such request or otherwise made any application to an industrial tribunal seeking orders in relation to the negotiation of a collective bargaining agreement or the taking of industrial action in relation to any such negotiation. The Company does not have a works council, staff council, staff association, employee representative body or other organisation of employees in respect of the employees.

5. Industrial action

There is no, nor at any time during the twelve months preceding the date of this Deed has there been any, strike, industrial action or dispute taken by or in relation to the employees or former employees of the Company by any trade union, works council or other employee representative body and, so far as the Warrantors are aware, no such strike, industrial action or dispute has been threatened or is existing or is anticipated.

 

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Part X – Pensions

Company Pension Scheme” means the pension plan provided by Aegon, details of which are contained in folder 8.6 of the Data Room.

Life Assurance Scheme” means the Tyrrells Potato Crisps Limited Group Life Assurance Scheme (policy number 637286) with Unum Limited, details of which are contained in folder 12 of the Data Room.

Pension Scheme” means any arrangement or agreement (including any closed, funded, unfunded, approved and unapproved arrangement) which provides Relevant Benefits.

Relevant Benefits” means pensions or other benefits on, or in anticipation of, retirement, death, accident, termination of employment (whether voluntary or not) or periods of sickness or disability of a Relevant Person.

Relevant Person” means any past or present employee, officer or director of the Company or any other Group Company.

1. Full particulars of the Company Pension Scheme have been Disclosed and all contributions, tax and expenses due in respect of the Company Pension Scheme have been duly paid.

2. The Company has complied in all material respects with its automatic enrolment obligations under the Pensions Act 2008 and associated legislation. No notices, fines or other sanctions have been issued or imposed by the Pensions Regulator and no instances of non-compliance with the automatic enrolment obligations have been notified to the Pensions Regulator in respect of any member of the Company.

3. Save for the Company Pension Scheme and the Life Assurance Scheme, there is not in operation, and no proposal has been announced to enter into or establish, and the Company is not liable to contribute to, and could not have any liability in respect of, and does not sponsor, nor has it ever participated in, contributed to, or sponsored any Pension Scheme.

4. All lump sum benefits which may become payable in the event of death or ill health under the Company Pension Scheme or the Life Assurance Scheme are fully insured and all related insurance premiums payable under such insurance contracts have been duly paid.

5. No Relevant Person has been transferred to any member of the Group from a previous employer under the Transfer of Undertakings (Protection of Employment) Regulations 2006, in particular in circumstances where the transferred Relevant Person had rights in a defined benefit pension scheme.

6. No contribution notice, financial support direction or restoration order has been served on the Company or any person connected to or associated with the Company by the Pensions Regulator in accordance with its powers under the Pensions Act 2004 and, so far as the Warrantors are aware, there is no reason why such a contribution notice, financial support direction or restoration order may be served on the Company.

7. The Company Pension Scheme only provides money purchase benefits, as defined in section 181 Pension Schemes Act 1993. No assurance, promise or guarantee has been made or given to a Relevant Person of a particular level or amount of benefit to be provided for or in respect of him under those schemes on death, retirement or leaving service.

 

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8. The Company Pension Scheme is a registered pension scheme for the purposes of section 150(2) Finance Act 2004 and, so far as the Warrantors are aware, there is no fact, matter or circumstance which might give a Tax Authority reason to revoke its registered status.

9. The Australian Subsidiaries have complied with all their obligations to make superannuation contributions which they are obliged to make on behalf of the employees and have provided at least the prescribed minimum level of superannuation support for each employee so as not to incur a shortfall amount under any Applicable Laws.

10. No Australian Subsidiary does or is obliged to make superannuation contributions to a defined benefit superannuation fund in respect of any of its employees.

Part XI – Property

1. Interpretation

In this Part XI of Schedule 1 reference to the “Company” shall, where the context so admits, be a reference to the company which is the owner of the relevant Property as shown in the column headed “Owner” in Schedule 5.

2. Warranties

2.1 Schedule 5 contains a complete and accurate list of the properties owned, controlled, leased, used or occupied by the Company or in which the Company has any interest and the information given in Schedule 5 is complete and accurate in all material respects, and the Company is the legal owner of and entitled to the whole of the proceeds of sale of, and has a good and marketable title to the whole of, each Property.

2.2 No Group Company has any continuing liability in respect of any leasehold property other than the Properties.

2.3 There are no mortgages, financial charges, rent charges, material liabilities to maintain roadways, liens (whether for costs or to an unpaid seller or otherwise), annuities or other material unusual outgoings, or trusts (whether for securing money or otherwise), affecting the Properties, and there are no third party rights or interests, options or rights of pre-emption or first refusal affecting the Properties nor, so far as the Warrantors are aware, is any person in the course of acquiring any such rights or interests;

2.4 There are no outstanding actions, disputes or claims between the Company and any third party which have had or may have a material adverse effect on the use of the Properties for the purpose of the Company’s business;

2.5 There is no outstanding material statutory notice relating to the Properties.

2.6 The Properties have the benefit of all necessary rights for their current uses.

2.7 In relation to each Property:

(a) no development at the Property or use of the Property has been undertaken in breach of the Town and Country Planning Act 1990, the Planning and Compulsory Purchase Act 2004, The Planning (Listed Buildings and Conservation Areas) Act 1990 (the “Listed Buildings Act”), the Planning (Hazardous Substances) Act 1990 and the Planning (Consequential Provisions) Act 1990 and all secondary legislation, regulations, rules, orders, decrees, notices, codes, circulars, guidance, guidance notes or final and binding court or tribunal decisions made in relation thereto (to the extent having the force of law);

 

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(b) the planning consents and permissions affecting the Property are either unconditional or are subject only to conditions which are neither unusual, personal nor temporary;

(c) there is no agreement affecting the Property made pursuant to Section 106 of the Town and Country Planning Act 1990 or Section 33 of the Local Government (Miscellaneous Provisions) Act 1982 or similar legislation which remains to be performed;

(d) there is no pending planning application, planning appeal or other planning proceedings in respect of the Property or which is likely to have a material adverse effect on the Property;

(e) there is no resolution, proposal, scheme or order, whether formally adopted or not, for the compulsory acquisition of the whole or any part of the Property or any access or egress, or for the alteration, construction or improvement of any road, sub-way, underpass, footbridge, elevated road, dual carriageway or flyover upon or adjoining or passing within 200 metres of the Property or any access to or egress from the Property;

(f) there is no outstanding enforcement notice, breach of condition notice, statutory notice or informal notice relating to the Property or any business carried on thereat or the use thereof;

(g) so far as the Warrantors are aware, the local planning authority has not authorised the service of any building preservation notice under Section 3 or 4 of the Listed Buildings Act or any repairs notice under Section 48 of the Listed Buildings Act in respect of the Property or any building, structure or erection thereon;

(h) so far as the Warrantors are aware, the local authority has not made or resolved to make any noise abatement zone order under Section 63 of the Control of Pollution Act 1974 for any area which includes the Property;

(i) so far as the Warrantors are aware, the Property is not in an urban development area, an improvement area or an enterprise zone; and

(j) so far as the Warrantors are aware, there are no Local Land Charges registered in respect of the Property.

2.8 In relation to each Property which is held pursuant to a lease:

(a) so far as the Warrantors are aware, any consent necessary for the grant of the lease under which the Company holds its interest in the Property (the “Lease”) was duly obtained and a copy of the consent is with the documents of title;

 

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(b) there is no material subsisting breach, nor any material non-observance of any covenant, condition or agreement contained in the Lease on the part of either, so far as the Warrantors are aware, the relevant landlord or the Company;

(c) no landlord has refused to accept rent or made any complaint or objection and the receipt for the payment (if given) of rent which fell due immediately prior to the date of this Agreement is unqualified;

(d) no alterations have been made to the Property at the expense of the Company without all necessary consents and approvals in the last 5 years;

(e) all steps in rent reviews have been duly taken and no rent reviews are or should be currently under negotiation or the subject of a reference to an expert or arbitrator or the courts;

(f) there is no notice or other correspondence between any the Company and any landlord relating to the exercise of an option to renew any lease; and

(g) the Company has not agreed to assign, sublease or otherwise deal with the Company’s interest in a leased premises to any other person (other than a deemed assignment to the Purchaser).

Part XII – Environment

Hazardous Substance” means any natural or artificial substance (whether solid, liquid or a gas), noise, ion, vapour, electromagnetic charge or radiation, whether alone or in combination, which: (a) is capable of causing harm to or having a deleterious effect on the environment, (b) is a controlled, special, hazardous, polluting, toxic or dangerous substance or waste, or (c) restricts or makes more costly the use, development, ownership or occupation of the Property.

1. The Company has obtained all EHS Consents required for the operation of the Business and occupation and enjoyment of the Properties and the Equipment. Such EHS Consents are in full force and effect, and the Company has received no written notice of any facts or circumstances indicating that any EHS Consents are likely or may be quashed, varied, suspended, revoked, withdrawn or not renewed whether as a consequence of Completion or otherwise.

2. In the last three years, there have been no investigations and the Company has not received any written complaints or notices alleging or specifying that the Company has materially breached any applicable EHS Laws relating to any activities or operations carried on at any Property owned or occupied by the Company, nor are there any ongoing proceedings or claims against the Company relating to: (i) non-compliance with EHS Laws; (ii) liabilities or obligations arising under EHS Laws; or (iii) improper storage of good and materials.

3. So far as the Warrantors are aware, there are no conditions or circumstances that are reasonably expected to result in material liabilities or obligations to the Company pursuant to EHS Laws within 12 months of the date of this Deed.

 

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4. So far as the Warrantors are aware, no works or other investment or change in the conduct of the Business or material operating expenditure is required or based on current circumstances is likely to be required at the Properties within two years of Completion in order for the Company to maintain compliance with EHS Laws or to obtain or maintain any EHS Consents.

5. Complete and accurate copies of all environmental, health and safety and asbestos reports, surveys, assessments and investigations in respect of the Property or the Business have been Disclosed. The Company is taking, or has taken, all steps necessary to comply with the recommendations contained in them.

6. There has not been any storage, transportation, release, leakage, migration, spill, discharge, entry, disposal, deposit or emission into the environment of any Hazardous Substance caused by any activity, operation, process, act or omission carried out or made by or on behalf of the Company, or for which the Group Company may have any liability, other than in accordance with EHS Laws.

7. So far as the Warrantors are aware, there are no Hazardous Substances (including asbestos) present at, in, on or under the Property (including in any tanks, whether above or below ground).

Part XIII – Food Matters

1. There is no, and has been no, failure or, so far as the Warrantors are aware, significant risk of failure of the Company’s products to comply with the Food Laws and, so far as the Warrantors are aware, there are no facts or circumstances which could reasonably be expected to give rise to any such failure.

2. All certifications, authorisations, licences or permissions required in relation to Food Matters have been obtained and are in full force and effect and, so far as the Warrantors are aware, there are no facts or circumstances which indicate that any such certification, authorisation, licence or permission may be suspended, varied, limited or revoked or not extended or renewed.

Part XIV – Tax

1. Compliance

1.1 Within the last four years, the Company has made all material returns, claims for relief, applications, elections, disclaimers, notifications, computations, reports, accounts, statements, registrations and assessments (including any land transaction returns) and any other necessary information (“Returns”) it is required by law to submit to a Tax Authority. All Returns have been properly submitted to the relevant Tax Authority by the Company within any relevant time limits. The Returns were and remain materially complete, true and accurate and are not, and, so far as the Warrantors are aware, are not likely to be, the subject of any dispute with any Tax Authority.

1.2 So far as the Warrantors are aware, all Tax (whether of the UK or elsewhere) for which the Company has been liable to account has been duly paid (insofar as such Tax ought to have been paid) and no penalties, fines, surcharges or interest in respect of Tax have been incurred.

 

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1.3 The Company has prepared, kept and preserved sufficient Tax records as required by law and to enable it to deliver correct and complete Returns. Such records are materially accurate and up-to-date and enable the Tax liabilities of the Company to be calculated accurately in all material respects.

1.4 So far as the Warrantors are aware, all payments made by the Company to any person which ought to have been made under deduction of tax have been so made. So far as the Warrantors are aware, the Company has, where legally obliged to do so, deducted or withheld amounts in respect of Tax and has properly and within the time limits required by Applicable Law accounted to the relevant Tax Authority for the Tax so deducted or withheld.

1.5 The Company has not within the last three years been subject to any non-routine visit, audit, investigation, enquiry, discovery or access order by any Tax Authority.

1.6 Details of all material written agreements, concessions or other formal arrangements between the Company and any tax authority regarding its tax treatment have been Disclosed in the Disclosure Letter and the Company has not received notice from any Tax Authority that it intends to withdraw any such arrangement or concession.

1.7 The Disclosure Letter discloses whether or not the Company is a large company within the meaning of regulation 3 of the Corporation Tax (Instalment Payment) Regulations 1998.

1.8 So far as the Warrantors are aware, the Company is not, nor will become, liable to make to any person (including any Tax Authority) any payment in respect of any liability to Tax which is primarily or directly chargeable against, or attributable to, any other person.

1.9 So far as the Warrantors are aware, the Accounts make full provision or reserve within generally accepted accounting principles for all Tax for which the Company is liable or will become liable in respect of income, profits or gains earned, accrued or received (or deemed for any relevant Tax purpose to be earned, accrued or received) on or before the Accounts Date. Proper provision has been made and shown in the Accounts for deferred tax in accordance with generally accepted accounting principles.

2. Value Added Tax

2.1 The Company is duly registered for the purposes of VAT in its country of jurisdiction.

2.2 So far as the Warrantors are aware, the Company has complied with its legal obligations relating to VAT, including, without limitation, applicable registration requirements, maintaining and retaining complete, accurate and up to date records, invoices and other documents in such form and for such periods as required by Applicable Law.

2.3 So far as the Warrantors are aware, all supplies made by the Company are taxable supplies. The Company has not been, nor, so far as the Warrantors are aware, will it be, denied full credit for all input tax paid or suffered by it.

2.4 The Disclosure Letter sets out the prescribed VAT accounting periods of the Company and the Subsidiaries.

2.5 The Company is not nor has been, in the period of seven years ending with the date of Completion, a member of a group for the purposes of VAT.

 

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3. Employees

So far as the Warrantors are aware, the Company has complied, in all material respects, with its legal obligations relating to PAYE and National Insurance contributions and any similar amounts payable to a Tax Authority outside the United Kingdom.

4. Stamp Taxes

4.1 So far as the Warrantors are aware, there is no instrument which may be necessary or desirable to establish the Company’s rights or the Company’s title to any asset, which is liable to stamp duty (or any equivalent Tax in a jurisdiction outside the United Kingdom) which has not been duly stamped or in respect of which the relevant Tax has not been paid.

4.2 So far as the Warrantors are aware, neither entering into this agreement nor Completion will result in the withdrawal of a stamp duty or stamp duty land tax relief granted on or before Completion which will affect the Company.

5. International

So far as the Warrantors are aware, the Company is and always has been resident in its jurisdiction of incorporation for Tax purposes and is not, and has not at any time been, treated as resident in any other jurisdiction for any Tax purpose (including for the purposes of any double taxation agreement), nor does it have or has ever had a permanent establishment in any other jurisdiction.

6. Anti-avoidance

The Company has not taken part in any arrangements in respect of which any disclosure has been made or has been required to be made or any information has been provided or has been required to be provided in compliance with part 7 of the Finance Act 2004 (disclosure of tax avoidance schemes) or schedule 11A Value Added Tax Act 1994 (disclosure of avoidance schemes) or any regulations made under that part or that schedule.

7. Transfer Pricing

So far as the Warrantors are aware, all transactions or arrangements made by the Company have been made on arm’s length terms and the processes by which prices and terms have been arrived at have, in each case, been fully documented. No notice, enquiry or adjustment has been made by any Tax Authority in connection with any such transactions or arrangements.

8. Distributions and other payments

8.1 No distribution or deemed distribution has been made (or will be deemed to have been made) by the Company, except dividends shown in their statutory accounts, and the Company is not bound to make any such distribution.

9. Tax groups and fiscal unities

9.1 So far as the Warrantors are aware, all claims made by the Company for group relief or allowance were valid when made and have been or will be allowed by way of relief from or allowance or credit against Tax. So far as the Warrantors are aware, all arrangements entered into by the Company in relation to groups and consolidated groups for Tax purposes

 

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and fiscal unities were valid when made and will be valid up to Completion. The Company has met all procedural and other requirements of all Tax Statutes in respect of such claims, unities or groups.

9.2 So far as the Warrantors are aware, neither the execution nor completion of this Agreement, nor any other event since the Accounts Date, will result in the clawback or disallowance of any group relief or allowance previously given.

10. Inheritance tax

So far as the Warrantors are aware, no asset owned by the Company is subject to any Inland Revenue charge as mentioned in sections 237 and 238 of IHTA 1984 or is liable to be subject to any sale, mortgage or charge by virtue of section 212(1) of IHTA 1984.

11. Close Companies

Any loans or advances made, or agreed to be made, by the Company within sections 455, 459 and 460 of CTA 2010 (or the equivalent in a jurisdiction outside the United Kingdom) have been disclosed in the Disclosure Letter. The Company has not released or written off, or agreed to release or write off, the whole or any part of any such loans or advances.

12. Group Relief

The Company is not, nor will be, obliged to make or be entitled to receive any payment for the surrender of group relief as defined in section 183 of CTA 2010 (or the equivalent in a jurisdiction outside the United Kingdom) in respect of any period ending on or before Completion, or any payment for the surrender of the benefit of an amount of advance corporation tax or any repayment of such a payment.

Part XV – Related Party Transactions

The Disclosure Letter sets out a complete and accurate list of each shareholder, member, partner, director, officer, employee, or other affiliate of the Company who or which is, directly or indirectly, a party to any transaction with the Company (other than employment compensation in the ordinary and usual course of business).

Part XVI – Other Agreements

1. Other agreements

There are no agreements between any Warrantor and any other person with respect to: (i) the holding, voting or transfer of any securities of the Company (except as contemplated by the Investment Agreement) or (ii) the right of any person to nominate members of the board of directors of the Company.

2. Commissions

No person is entitled to receive from the Company any finder’s fee, bonus, brokerage or other commission in connection with the sale and purchase of the Securities.

 

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Part XVII – Data Protection

1. Data Protection

1.1 The Company has complied with all Applicable Laws, guidelines and industry standards relating to the processing of personal data and privacy (“Data Protection Laws”), and the Company has received any notice from a relevant competent authority in any jurisdiction alleging any non-compliance by the Company of any Data Protection Laws.

1.2 Copies of all current registrations or notifications required by the Company under Data Protection Laws are Disclosed.

1.3 The Company has not received any notices or any other communications from, been subject to inquiries by or, so far as the Warrantors are aware, been the subject of complaints to any authority or regulatory body in relation to Data Protection Laws. So far as the Warrantors are aware, there are no circumstances which are likely to give rise to any such notices, communications, inquiries or complaints.

 

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SCHEDULE 2

LIMITATIONS ON LIABILITY

1. DEFINITIONS AND INTERPRETATION

In this Schedule (unless the context otherwise requires):

1.1 “determination” means a final determination by a court of competent jurisdiction where no right of appeal lies in respect of such judgement or the parties are debarred by passage of time or otherwise from making an appeal (as the case may be) and “determined” shall be construed accordingly; and

1.2 a “Tax Warranty Claim” means any claim under the Warranties set out in Part XIV of Schedule 1.

2. TIME LIMITS

2.1 The Warrantors shall not be liable for any Claim unless written notice of the Claim has been given to the Warrantors by or on behalf of the Purchaser:

(a) in respect of any Claim other than a Tax Warranty Claim, on or before the date which falls 24 months after the Completion Date; and

(b) in respect of any Tax Warranty Claim, on or before the date which falls seven years after the Completion Date.

2.2 The written notice of the Claim shall be given to the Warrantors as soon as reasonably practicable after a Claim has arisen but subject to the time limits in paragraph 2.1 above, failure to do, or delay in doing, so shall not prejudice in any way the Purchaser’s ability to bring a Claim.

2.3 The written notice of the Claim shall give reasonable details of the nature of the Claim, the circumstances giving rise to it and the Purchaser’s bona fide estimate of the Claim.

2.4 Without prejudice to the time limits set out in paragraph 2.1 above, any Claim shall be deemed to be withdrawn (if it has not been previously satisfied, settled or withdrawn) (and no new Claim may be made in respect of the facts giving rise to such withdrawn claim) unless legal proceedings in respect thereof have been commenced within nine months of the giving of written notice of the Claim (or, in the case of a liability which is contingent only or is otherwise not capable of being quantified, nine months after the contingent liability has become an actual liability or (as the case may be) becomes capable of being quantified), and for this purpose such legal proceedings shall not be deemed to have commenced unless both issued and served.

3. UPPER LIMITS

3.1 The total aggregate liability of each Warrantor for all Claims shall be limited to the amount set out opposite his name in column (3) of Schedule 3 (a “Warrantors Cap”). For the purposes of these limits, the liability of the Warrantors shall be deemed to include the amount of all costs, expenses and other liabilities (together with any irrecoverable VAT thereon) payable by the Warrantors in connection with the satisfaction, settlement or determination of any such Claim.

 

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3.2 Subject to clause 2.1, the liability of each of the Warrantors who is so liable for each individual Claim shall not exceed the Warrantor’s Relevant Proportion of the liability under such Claim subject always to the Warrantor’s Cap, whichever amount is the lesser. For the purposes of this paragraph 3.2 of this Schedule 2, each Warrantor’s “Relevant Proportion” shall mean the proportion which his individual Warrantor’s Cap bears to the aggregate total of the Warrantors’ Caps of all those Warrantors liable for that Claim.

3.3 Notwithstanding the provisions of paragraphs 3.1 and 3.2 of this Schedule 2, the total aggregate liability of each Warrantor for any and all breaches of:

(a) any of the Warranties; and

(b) the Transaction Documents excluding this Deed (save for any breaches of the covenant set out in clause 7 (Leakage) of the Sale and Purchase Agreement), by him shall be limited to the amount of Consideration received by him.

3.4 The Warrantors shall have no liability under this Deed in respect of:

(a) any amounts recoverable or actually recovered by the Purchaser under the W&I Policy (or any amount of the deductible thereon under the W&I Policy) or the Tax Policy; and

(b) any amounts that would have been recoverable under the W&I Policy but for a breach by the Purchaser of the terms of clause 7 of the Deed, provided that this shall not limit or prejudice the Purchaser’s ability to give a notice of Claim in accordance with the provisions of paragraph 2 of this Schedule 2.

4. LOWER LIMITS

4.1 The Warrantors shall not be liable for any Claim unless the aggregate amount of such Claim, when taken together with the amount of all other Claims that are not De Minimis Claims, exceeds £1,000,000 (the “Threshold”) in which event the Warrantors shall, subject to the other limits contained in this Schedule and to clause 7 of the Deed and the Disclosed Matters, be liable (subject to paragraph 4.2 below) for the whole amount of the Claim and not just for the amount by which such aggregate amount exceeds the Threshold. For the purposes of calculating the Threshold, the Threshold shall be deemed to include the amount of all costs, expenses and other liabilities (together with any irrecoverable VAT thereon) payable by the Warrantors in connection with the satisfaction, settlement or determination of any such Claim.

4.2 The Warrantors shall not be liable for any individual Claim which does not exceed £50,000 (a “De Minimis Claim”). No such De Minimis Claim shall count towards the Threshold. For the purposes of calculating a De Minimis Claim, the De Minimis Claim shall be deemed to exclude the amount of all costs, expenses and other liabilities (together with any irrecoverable VAT thereon) payable by the Warrantors in connection with the satisfaction, settlement or determination of any such Claim.

 

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4.3 For the purposes of calculating Claims counting towards the Threshold and/or any De Minimis Claim there shall be included the amount of any Claim in respect of the same fact, matter, event or circumstances giving rise to the same loss.

5. NO DOUBLE RECOVERY

If the same fact, matter, event or circumstance gives rise to more than one Claim, the Purchaser shall not be entitled to recover damages in respect of the same breach more than once in respect of such fact, matter, event or circumstance.

6. PROVISION OF INFORMATION

6.1 Upon any Claim being made, the Purchaser, subject to appropriate confidentiality protections being in place, shall, and shall procure, where relevant, that the relevant Group Company shall:

(a) make available to the Warrantors and their advisers all such information and assistance (including access to personnel, properties, management, records, papers, documents and data) during normal working hours as the Warrantors may reasonably request in relation to the Claim; and

(b) use reasonable endeavours to procure that the auditors (both past and then present) of the relevant Group Company make available their audit working papers in respect of audits of the accounts of the relevant Group Company for any relevant accounting period in connection with such Claim, in each case, at the Warrantors’ cost.

7. ALLOWANCES, PROVISIONS AND RESERVES

The Warrantors shall not be liable for any Claim to the extent that:

7.1 any specific and full allowance, provision or reserve has been made in the Accounts and/or Management Accounts in respect of the fact, matter, event or circumstance giving rise to such Claim or to the extent that the payment or discharge of the relevant matter has been taken into account therein or to the extent that such fact, matter, event or circumstance was referred to in the notes to the Accounts and/or Management Accounts; or

7.2 any specific and full allowance, provision or reserve made in the Accounts and/or Management Accounts in respect of the fact, matter, event or circumstance giving rise to such Claim is insufficient by reason of any change to legislation or accounting standards, any increase in rates of Tax, the imposition of a new Tax or any change in the published practice of a Tax Authority, in each case made on and/or after Completion with retrospective effect; or

7.3 the Claim relates to a liability to Tax, the profits in respect of which were actually earned, accrued or received by the Company but were not reflected in the Accounts and/or Management Accounts.

 

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8. CHANGES ON AND/OR AFTER COMPLETION

The Warrantors shall not be liable for any Claim to the extent that it arises, or is increased or extended by:

8.1 any decision of any court or tribunal or the passing or coming into force of or any change in any legislation, regulation, directive, requirement or any practice of any government, government department or agency or regulatory body (including the withdrawal of any extra statutory concession of a Tax Authority), or any increase in rates of Tax, in each case made on and/or after Completion;

8.2 any change in the accounting reference date of the Purchaser or any Group Company made on and/or after Completion;

8.3 any change in any accounting basis, policy, practice or approach of, or applicable to, any Group Company or any member of the Purchaser’s Group, or any change in the way an accounting basis is adapted for tax purposes, in each case, made on and/or after Completion save where such change is required under Applicable Law or to conform such policy or practice with generally accepted policies or practices or where such change is necessary to correct an improper policy or practice in such case as was applicable at Completion;

8.4 any act, omission, transaction or arrangement carried out or effected on and/or after Completion by, or at the written request or with the written approval of, the Purchaser or any member of the Purchaser’s Group (or any of their respective directors, officers, employees or agents) otherwise than in the ordinary and usual course of trading of any Group Company as carried on at Completion (including, for the avoidance of doubt, the entry into the US Transfer Agreement) and any action taken pursuant to the US Transfer Agreement;

8.5 the Purchaser or any member of the Purchaser’s Group disclaiming any part of the benefit of capital or other allowances against Tax claimed or proposed to be claimed on or before Completion;

8.6 any action, transaction or omission after Completion on the part of the Purchaser or a Group Company, except that this exclusion shall not apply where any such action, transaction or omission is carried out or effected by the Purchaser or a Group Company:

(a) pursuant to a legally binding commitment created on or before Completion; or

(b) at the written request of the Warrantors after Completion with specific reference to this paragraph 9.7(b).

9. CHANGES ON AND/OR AFTER THE LOCKED BOX DATE

The Warrantors shall not be liable for any Claim in respect of any liability arising in connection with any Group Company acquiring or disposing of any business or any interest in the share or loan capital or membership of any person or joint venture, or any instruments convertible into any of the foregoing, or of any asset, on or after the Locked Box Date.

10. THIRD PARTY CLAIMS

10.1 In respect of any fact, matter, event or circumstance which comes to the notice of the Purchaser or any Group Company which would or is reasonably likely to result in a claim

 

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against it (a “Third Party Claim”) and which, in turn, would or is reasonably likely to result in a claim against any of the Warrantors, the Purchaser shall (and shall procure, where relevant, that the relevant Group Company shall), subject to appropriate confidentiality protections being in place:

(a) as soon as is reasonably practicable, give written notice and reasonable details of the Third Party Claim to the Warrantors’ Representatives;

(b) not make any admission of liability, agreement, settlement or compromise with any person, body or authority in relation to the Third Party Claim without prior consultation with the Warrantors’ Representatives;

(c) allow the Warrantors and their advisers to investigate the Third Party Claim (including whether and to what extent any amount is payable in respect thereof);

(d) consult in good faith with the Warrantors’ Representatives as to any ways in which the Third Party Claim might be avoided, disputed, resisted, mitigated, settled, compromised, defended or appealed; and

(e) make available (and shall use its reasonable endeavours to procure that any of its auditors, past or present, shall make available) to the Warrantors’ Representatives and their advisers and agents all such information and assistance (including access to properties, management, records, papers, documents and data) during normal working hours as they may reasonably require which in the reasonable opinion of the Warrantors’ Representatives relate to the Third Party Claim, in each case at the cost of the Warrantors.

10.2 This paragraph 10 shall be subject to the Purchaser not being obliged to take or omit to take any action pursuant to this paragraph 10 where, in the reasonable opinion of the Purchaser, such action or omission might reasonably be expected to damage the reputation or goodwill of the Purchaser’s Group or any relationship between the Purchaser’s Group and a material supplier, customer or employee or otherwise be materially adverse to the business interests of the Purchaser’s Group.

11. REMEDIABLE BREACHES

The Warrantors shall not be liable for any Claim to the extent that the fact, matter, event or circumstance giving rise to such Claim is remediable and is remedied by, or at the expense of, the Warrantors to the satisfaction of the Purchaser (acting reasonably) within 30 days of the date on which written notice of such Claim is given to the Warrantors pursuant to paragraph 2.

12. REIMBURSEMENT OF CLAIMS

If, after any Warrantor has made any payment in respect of a Claim, the recipient of that payment (or any other member of the Purchaser’s Group) actually recovers from a third party (including any Tax Authority) (whether by payment, discount, credit, relief or otherwise) a sum which is referable to that payment (the “Recovery Amount”), then the Purchaser shall promptly repay (or procure the repayment of) to the relevant Warrantor such sum as is the lesser of (i) the Recovery Amount less all reasonable costs of recovery and any Tax payable thereon and (ii) the sum paid by that Warrantor.

 

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13. UNASCERTAINABLE CLAIMS

The Warrantors shall not be liable for any Claim which arises by reason of a liability which, at the time when written notice of the Claim is given to the Warrantors, is contingent only or is otherwise not capable of being quantified and the Warrantors shall not be liable to make any payment in respect of such Claim unless and until the liability becomes an actual liability or (as the case may be) becomes capable of being quantified. This is without prejudice to the right of the Purchaser to give notice of the Claim in accordance with paragraph 2.1 above and commence legal proceedings in respect of it in accordance with paragraph 2.4 above.

14. MITIGATION

14.1 The Purchaser shall (and shall procure that any relevant Group Company shall) comply with its common law duty to mitigate any loss suffered by it or the relevant Group Company which would or is reasonably likely to result in a Claim against the Warrantors.

 

47


SCHEDULE 3

WARRANTORS

 

48


SCHEDULE 4

GROUP COMPANIES

 

49


SCHEDULE 5

PROPERTIES

 

50


SCHEDULE 6

INTELLECTUAL PROPERTY RIGHTS

 

51


EXECUTED by the Parties as a deed    

EXECUTED as a deed by Tom Ennis

for and on behalf of
the Purchaser

 

)

)

)

 
     

/s/ Thomas Ennis

      Director
in the presence of:      
Signature of witness  

/s/ Brian Goldberg

   
Name of witness  

Brian Goldberg

   
Address of witness  

 

   

500 W. Fifth St.

   

Suite 1350

   

Austin, TX 78701

   
Occupation of witness  

CFO

   

 

[Signature page to Warranty Deed]


SIGNED as a deed by
David Milner
 

)

)

  /s/ David Milner
in the presence of:    
Signature of witness  

/s/ Eleanor Gill

   
Name of witness  

Eleanor Gill

   
Address of witness  

 

   

Travers Smith LLP

   

10 Snow Hill

   

London EC1A 2AL

   
Occupation of witness  

Trainee Solicitor

   
SIGNED as a deed by
Joanne Jones
 

)

)

  /s/ Joanne Jones
in the presence of:  

 

   
Signature of witness  

/s/ Eleanor Gill

   
Name of witness  

Eleanor Gill

   
Address of witness  

Travers Smith LLP

   

10 Snow Hill

   

London EC1A 2AL

   

 

   
Occupation of witness  

Trainee Solicitor

   

 

[Signature page to Warranty Deed]


SIGNED as a deed by
Michael Hedges
 

)

)

  /s/ Michael Hedges
in the presence of:    
Signature of witness  

/s/ Eleanor Gill

   
Name of witness  

Eleanor Gill

   
Address of witness  

Travers Smith LLP

   

10 Snow Hill

   

London EC1A 2AL

   

 

   
Occupation of witness  

Trainee Solicitor

   
SIGNED as a deed by
Stuart Telford
 

)

)

  /s/ Stuart Telford
in the presence of:  

 

   
Signature of witness  

/s/ Eleanor Gill

   
Name of witness  

Eleanor Gill

   
Address of witness  

Travers Smith LLP

   

10 Snow Hill

   

London EC1A 2AL

   

 

   
Occupation of witness  

Trainee Solicitor

   

 

[Signature page to Warranty Deed]


SIGNED as a deed by
Janice Bennett
 

)

)

  /s/ Janice Bennett
in the presence of:    
Signature of witness  

/s/ Eleanor Gill

   
Name of witness  

Eleanor Gill

   
Address of witness  

Travers Smith LLP

   

10 Snow Hill

   

London EC1A 2AL

   

 

   
Occupation of witness  

Trainee Solicitor

   
SIGNED as a deed by
Andrew Blain
 

)

)

  /s/ Andrew Blain
in the presence of:  

 

   
Signature of witness  

/s/ Eleanor Gill

   
Name of witness  

Eleanor Gill

   
Address of witness  

Travers Smith LLP

   

10 Snow Hill

   

London EC1A 2AL

   

 

   
Occupation of witness  

Trainee Solicitor

   

 

[Signature page to Warranty Deed]


SIGNED as a deed by
Jochen Krumm
 

)

)

  /s/ Jochen Krumm
in the presence of:    
Signature of witness  

/s/ Tony Rosios

   
Name of witness  

Tony Rosios

   
Address of witness  

 

   

#####

   

#####

   

 

   
Occupation of witness  

#####

   

 

[Signature page to Warranty Deed]

(Back To Top)

Section 4: EX-99.1 (EX-99.1)

EX-99.1

Exhibit 99.1

 

 

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Amplify Snack Brands, Inc. Reports Second Quarter 2016 Financial Results

Second Quarter Net Sales Increased 26.4% Year-Over-Year to $59.9 Million

Second Quarter GAAP Net Income of $8.8 million and Adjusted EBITDA of $21.7 Million

Enters Into Definitive Agreement to Acquire Tyrrells’ International Portfolio of Better-For-You Premium Snack Brands

Austin, Texas – August 8, 2016 – Amplify Snack Brands, Inc. (“Amplify” or the “Company”) (NYSE:BETR) today reported financial results for the three and six months ended June 30, 2016.

Three Months Ended June 30, 2016 Highlights

 

    Net sales were $59.9 million, up 26.4% year-over-year

 

    Gross profit was $32.5 million, representing 54.4% of net sales

 

    GAAP net income was $8.8 million, or $0.12 per fully diluted share

 

    Non-GAAP adjusted net income was $11.3 million, or $0.15 per fully diluted share

 

    Adjusted EBITDA was $21.7 million, representing 36.3% of net sales

Six Months Ended June 30, 2016 Highlights

 

    Net sales were $114.2 million, up 24.6% year-over-year

 

    Gross profit was $61.0 million, representing 53.4% of net sales

 

    GAAP net income was $17.2 million, or $0.23 per fully diluted share

 

    Non-GAAP adjusted net income was $21.4 million, or $0.29 per fully diluted share

 

    Adjusted EBITDA was $41.3 million, representing 36.2% of net sales

“Our brand momentum continued at a strong pace resulting in another quarter of record revenue and profitability,” said Tom Ennis, Amplify’s President and Chief Executive Officer. “Our second quarter performance was fueled by strong SkinnyPop sales growth, the further rollout of Paqui, and contribution from our recent acquisition of Oatmega. As we enter the second half of 2016, we believe we are well positioned to execute on our growth strategy and enhance shareholder value.”

Mr. Ennis continued, “Amplify was created to be a market leading platform in the Better-For-You snacking category and we are excited to welcome the addition of Tyrrells as we leverage our unique competencies to partner with and grow best-in-class Better-For-You brands. Tyrrells represents a highly strategic, rapidly growing and sizeable acquisition for Amplify and greatly expands our snacking categories and international presence.”

Three Months Ended June 30, 2016

Net sales increased 26.4% to $59.9 million compared to $47.4 million for the three months ended June 30, 2015. The increase in net sales reflects strong growth of the SkinnyPop brand, new distribution of the Paqui brand, and the addition of the Oatmega brand which the Company acquired in late April 2016.

Gross profit was $32.5 million, or 54.4% of net sales, compared to $26.7 million, or 56.4% of net sales for the three months ended June 30, 2015. The decrease in gross margin percentage for the three months ended June 30, 2016 was driven by a higher level of trade promotional activity and increased contribution of the Paqui and Oatmega brands which have a lower gross margin profile than SkinnyPop. Gross margin of 54.4% for the quarter represents a 210 basis point sequential increase from 52.3% for

 

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the three months ended March 31, 2016, driven by lower trade promotional spend and partially offset by the increased contribution of the Paqui and Oatmega brands which have a lower gross margin profile than SkinnyPop.

GAAP SG&A was $14.3 million compared to $17.0 million for the second quarter ended June 30, 2015. GAAP net income increased $5.2 million to $8.8 million, or $0.12 per fully diluted share, compared to net income of $3.6 million, or $0.05 per fully diluted share, for the three months ended June 30, 2015. Adjusted net income, which is a non-GAAP financial measure used by the Company that makes certain adjustments to net income calculated under GAAP, was $11.3 million, or $0.15 per fully diluted share, compared to adjusted net income of $10.0 million for the three months ended June 30, 2015, or $0.13 per fully diluted share.

Adjusted EBITDA, which is a non-GAAP financial measure used by the Company that makes certain adjustments to net income calculated under GAAP, increased 15.5% to $21.7 million from $18.8 million for the three months ended June 30, 2015, primarily reflecting higher net sales and gross profit, and partially offset by higher Adjusted SG&A. Adjusted SG&A, which is a non-GAAP financial measure used by the Company that makes certain adjustments to SG&A calculated under GAAP, was $10.9 million, compared to Adjusted SG&A of $7.9 million for the three months ended June 30, 2015. The increase in Adjusted SG&A was primarily driven by increased consumer marketing activities to drive brand awareness and customer trial and new costs associated with operating as a public company including investments in infrastructure and personnel. As a percentage of net sales, Adjusted EBITDA was 36.3% compared to 39.7% in the three months ended June 30, 2015.

Six Months Ended June 30, 2016

Net sales for the six months ended June 30, 2016 increased 24.6% to $114.2 million, compared to $91.6 million during the six months ended June 30, 2015. The increase in net sales reflects strong growth of the SkinnyPop brand, new distribution of the Paqui brand, and the addition of the Oatmega brand which the Company acquired in late April 2016.

Gross profit for the six months ended June 30, 2016 increased $9.9 million to $61.0 million, or 53.4% of net sales, compared to $51.1 million, or 55.8% of net sales for the six months ended June 30, 2015. The decrease in gross margin was driven by a higher level of trade promotional activity and increased contribution of the Paqui and Oatmega brands which have a lower gross margin profile than SkinnyPop, partially offset by improved rates on materials and ingredients.

GAAP SG&A was $25.4 million compared to $29.7 million for the six months ended June 30, 2015. GAAP net income increased $8.7 million to $17.2 million, or $0.23 per fully diluted share, compared to net income of $8.5 million, or $0.11 per fully diluted share, for the six months ended June 30, 2015. Adjusted net income, which is a non-GAAP financial measure used by the Company that makes certain adjustments to net income calculated under GAAP, was $21.4 million, or $0.29 per fully diluted share, compared to adjusted net income of $20.0 million for the six months ended June 30, 2015, or $0.27 per fully diluted share.

Adjusted EBITDA, a non-GAAP financial measure, increased 8.5% to $41.3 million from $38.0 million for the six months ended June 30, 2015. Adjusted SG&A, which is a non-GAAP financial measure, was $19.8 million, compared to Adjusted SG&A of $13.2 million for the six months ended June 30, 2015. The

 

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increase in Adjusted SG&A was primarily driven by increased consumer marketing activities to drive brand awareness and customer trial and new costs associated with operating as a public company including investments in infrastructure and personnel. Adjusted EBITDA as a percentage of net sales for the six months ended June 30, 2016 was 36.2%, compared to 41.5% for the six months ended June 30, 2015.

Balance Sheet and Cash Flow

As of June 30, 2016, the Company had cash and cash equivalents of $7.4 million and net availability under its revolving line of credit of $10.0 million. In July, the Company amended its credit facility to increase capacity under its revolving line of credit by $15.0 million to a total of $40.0 million. Net debt, as defined under the Company’s credit facility, represents outstanding indebtedness less cash and cash equivalents, was $205.2 million as of June 30, 2016, compared to $182.5 million as of December 31, 2015. The increase was attributable to a decrease in cash associated with a $23.0 million payment of the founder contingent compensation liability and the acquisition of the Oatmega brand during the six months ended June 30, 2016. The Company expects to pay the remaining estimated $2.2 million founder contingent compensation liability once the tax gross-up amount is determined upon the completion of our final 2015 tax return. Amplify’s leverage ratio as calculated under the Company’s credit facility increased to 2.6x trailing twelve month EBITDA at June 30, 2016, up from 2.5x at March 31, 2016.

Enters Into Definitive Agreement to Acquire Tyrrells’ International Portfolio of Better-For-You Premium Snack Brands

In a separate press release today, the Company also announced it has executed a definitive agreement under which Amplify will acquire Tyrrells, a rapidly growing premium Better-For-You snack food business. The transaction has been unanimously approved by Amplify’s board of directors. Amplify expects that this acquisition will be accretive to the Company’s 2017 and 2018 diluted earnings per share. Under the terms of the transaction agreement, Tyrrells will become a wholly-owned subsidiary of Amplify. The transaction is valued at £300 million, comprising of approximately £278 million and approximately 2.1 million shares of Amplify’s common stock issued to Tyrrells’ current owner Investcorp and members of Tyrrells management team, valued at £22 million. Upon closing, The transaction is expected to close by the end of the third quarter of calendar 2016, subject to customary closing conditions including approval by regulators.

Outlook

The Company is updating its outlook for full year 2016, which assumes a September 30, 2016 close on the acquisition of Tyrrells and the resulting benefit of one quarter of Tyrrells’ financial contribution. Additional details will be provided on our earnings call, but for the full year 2016 the Company now expects to report:

 

    Net sales of $260 million to $270 million

 

    Adjusted EBITDA of $92 million to $96 million

The Company has not reconciled its expected Adjusted EBITDA to net income under “Outlook” because it has not finalized calculations for several factors necessary to provide the reconciliations, including net income, interest expense and income tax expense. In addition, certain items that impact net income and other reconciling metrics are out of the Company’s control and/or cannot be reasonably predicted at this time.

 

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Conference Call and Webcast

The Company will host a conference call with members of the executive management team to discuss these results and the definitive agreement to acquire Tyrrells today, Monday, August 8, 2016 at 7:00 a.m. Central time (8:00 a.m. Eastern time). Investors interested in participating in the live call can dial 877-407-9039 from the U.S. International callers can dial 201-689-8470.

In addition, the call will be broadcast live over the Internet hosted at the “Investor Relations” section of the Company’s website at http://amplifysnackbrands.com. The webcast will be archived for 30 days. A telephone replay will be available approximately two hours after the call concludes and will be available through Monday, August 18, 2016, by dialing 877-870-5176 from the U.S., or 858-384-5517 from international locations, and entering confirmation code 13641697.

About Amplify Snack Brands, Inc.

Headquartered in Austin, Texas, Amplify Snack Brands is a high growth snack food company focused on developing and marketing products that appeal to consumers’ growing preference for Better-For-You (BFY) snacks. Our brands SkinnyPop®, Paqui® and Oatmega® embody our BFY mission of “snacking without compromise” and have amassed a loyal customer base across a wide range of food distribution channels in the United States and Canada. For additional information, please visit: http://amplifysnackbrands.com.

Forward-Looking Statements

This press release contains certain forward-looking statements regarding our performance, including in the section titled “Outlook.” This press release also contains forward-looking statements with regard to the proposed acquisition by Amplify of Crisps Topco Limited and subsidiaries. Forward-looking statements generally relate to future events or our future financial or operating performance. In some cases, you can identify forward-looking statements because they contain words such as “may”, “will”, “should”, “expects”, “plans”, “anticipates”, “could”, “intends”, “target”, “projects”, “contemplates”, “believes”, “estimates”, “predicts”, “potential” or “continue” or the negative of these words or other similar terms or expressions that concern our expectations, strategy, plans or intentions. Forward-looking statements are subject to known and unknown risks and uncertainties and are based on potentially inaccurate assumptions that could cause actual results to differ materially from those expected or implied by the forward-looking statements. If any such risks or uncertainties materialize or if any of the assumptions prove incorrect, our results could differ materially from the results expressed or implied by the forward-looking statements we make.

The important factors that could cause actual results to differ materially from those in any forward-looking statements include, but are not limited to, the following: (i) changes in consumer preferences and discretionary spending may have a material adverse effect on our brand loyalty, net sales, results of operations and financial condition, (ii) we rely on sales to a limited number of distributors and retailers for the substantial majority of our net sales, and the loss of one or more such distributors or retailers may harm our business, (iii) sales of a limited number of SkinnyPop products and flavors contributed all of our historical profitability and cash flow and a reduction in the sale of our SkinnyPop products would have a material adverse effect on our ability to remain profitable and achieve future growth, (iv) our ability to successfully consummate the proposed acquisition of Crisps Topco Limited and subsidiaries on the terms described in this press release or at all, (v) the satisfaction of all necessary closing conditions

 

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and approvals for the proposed acquisition, and (vi) our ability to successfully integrate Crisps Topco Limited and subsidiaries with our existing operations following the consummation of the proposed acquisition.

Further information on these and other factors that could affect our financial results and the forward-looking statements in this press release are included in our Annual Report on Form 10-K for the year ended December 31, 2015 and our Quarterly Report on Form 10-Q for the quarter ended March 31, 2016, in each case, as filed with the Securities and Exchange Commission (“SEC”) and in other filings we will make with the SEC from time to time, particularly under the caption Risk Factors.

You should not place undue reliance upon forward-looking statements as predictions of future events. Amplify has based the forward-looking statements contained in this press release on its current expectations and projections about future events and trends that it believes may affect its business, financial condition, results of operations and prospects. The forward-looking statements made in this press release relate only to events as of the date on which the statements are made. Amplify undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as may be required by law.

Non-GAAP Measures

In order to aid understanding of Amplify’s business performance, it has presented results in conformity with accounting principles generally accepted in the United States (“GAAP”) and has also presented Adjusted SG&A, Adjusted EBITDA and Adjusted net income and the corresponding earnings per share, which are non-GAAP measures that are explained and reconciled to the comparable GAAP measures in the tables included in this release.

Management believes that Adjusted SG&A, Adjusted EBITDA and Adjusted net income and the corresponding earnings per share, which are non-GAAP measurements, are meaningful to investors because they provide a view of the Company with respect to ongoing operating results. Adjusted EBITDA and Adjusted net income are not and should not be considered alternatives to net income or any other figure calculated in accordance with GAAP, or as an indicator of operating performance. The Company’s calculation of Adjusted SG&A, Adjusted EBITDA and Adjusted net income and the corresponding earnings per share may differ from methods used by other companies. Management believes that these non-GAAP measurements are important to help gain an understanding of the Company’s overall operating results in the periods presented. Such non-GAAP measurements are not recognized in accordance with GAAP and should not be viewed as an alternative to GAAP measures of performance. We have not reconciled our expected Adjusted EBITDA to net income or Adjusted EPS to earnings per share under “Outlook” because we have not finalized our calculations of several factors necessary to provide the reconciliations, including net income, interest expense and income tax expense. In addition, certain items that impact net income and other reconciling metrics are out of our control and/or cannot be reasonably predicted at this time.

CONTACT

Investors

ICR

Katie Turner

646-277-1228

katie.turner@icrinc.com

 

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Media

ICR

Cory Ziskind

646-277-1232

cory.ziskind@icrinc.com

Amplify Snack Brands, Inc. and Consolidated Subsidiaries

Condensed Consolidated Balance Sheets

(in thousands)

 

     June 30, 2016      December 31, 2015  
     (unaudited)         

Assets

     

Current assets:

     

Cash and cash equivalents

   $ 7,413       $ 18,751   

Accounts receivable, net

     17,051         11,977   

Inventories

     10,266         6,829   

Other current assets

     1,357         1,293   
  

 

 

    

 

 

 

Total current assets

     36,087         38,850   

Property and equipment, net

     2,860         2,153   

Other assets:

     

Goodwill

     56,137         47,421   

Intangible assets, net

     279,294         269,468   

Other non-current assets (1)

     55         40   
  

 

 

    

 

 

 

Total assets

   $ 374,433       $ 357,932   
  

 

 

    

 

 

 

Liabilities and Shareholders’ Equity

     

Current liabilities:

     

Accounts payable and accrued liabilities

   $ 17,863       $ 14,532   

Senior term loan- current portion

     10,250         12,750   

Founder contingent consideration- current portion

     2,197         25,197   

Tax receivable obligation- current portion

     6,632         6,632   

Note payable, net

     977         —     

Other current liabilities

     785         217   
  

 

 

    

 

 

 

Total current liabilities

     38,704         59,328   

Long-term liabilities:

     

Senior term loan (1)

     177,006         181,704   

Revolving credit facility

     15,000         —     

Notes payable, net

     6,606         3,757   

Tax receivable obligation

     89,498         89,498   

Other liabilities

     13,335         8,222   
  

 

 

    

 

 

 

Total long-term liabilities

     301,445         283,181   

Total shareholders’ equity

     34,284         15,423   
  

 

 

    

 

 

 

Total liabilities and shareholders’ equity

   $ 374,433       $ 357,932   
  

 

 

    

 

 

 

 

(1)  In the first quarter of 2016, the Company adopted accounting guidance which requires debt issuance costs to be presented as a reduction to the carrying value of the related debt liability, rather than as a deferred charge (asset). This presentation will result in debt issuance costs being presented in the same way debt discounts have historically been presented. As a result, the Company reclassified $2.9 million of debt issuance costs from Other assets to a deduction from the carrying value of the Senior term loan as of December 31, 2015.

 

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Amplify Snack Brands, Inc. and Consolidated Subsidiaries

Condensed Consolidated Statements of Operations

For the Three and Six Months Ended June 30, 2016 and 2015

(unaudited, in thousands, except share and per share data)

 

     Three Months Ended      Six Months Ended  
     June 30, 2016      June 30, 2015      June 30, 2016      June 30, 2015  

Net sales

   $ 59,866       $ 47,354       $ 114,211       $ 91,629   

Cost of goods sold

     27,318         20,661         53,245         40,527   
  

 

 

    

 

 

    

 

 

    

 

 

 

Gross profit

     32,548         26,693         60,966         51,102   

Operating expenses:

           

Sales and marketing

     7,969         5,016         13,648         8,634   

General and administrative

     6,285         11,985         11,717         21,017   
  

 

 

    

 

 

    

 

 

    

 

 

 

Total operating expenses

     14,254         17,001         25,365         29,651   
  

 

 

    

 

 

    

 

 

    

 

 

 

Operating income

     18,294         9,692         35,601         21,451   

Interest expense

     3,126         3,058         6,152         6,013   
  

 

 

    

 

 

    

 

 

    

 

 

 

Income before income taxes

     15,168         6,634         29,449         15,438   

Income tax expense

     6,400         3,074         12,279         6,974   
  

 

 

    

 

 

    

 

 

    

 

 

 

Net income

   $ 8,768       $ 3,560       $ 17,170       $ 8,464   
  

 

 

    

 

 

    

 

 

    

 

 

 

Earnings per share:

           

Basic and diluted

   $ 0.12       $ 0.05       $ 0.23       $ 0.11   
  

 

 

    

 

 

    

 

 

    

 

 

 

Weighted average common shares outstanding:

           

Basic

     74,798,232         74,685,407         74,818,584         74,568,277   
  

 

 

    

 

 

    

 

 

    

 

 

 

Diluted

     74,847,862         74,685,407         74,846,083         74,568,277   
  

 

 

    

 

 

    

 

 

    

 

 

 

 

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Amplify Snack Brands, Inc. and Consolidated Subsidiaries

Reconciliation of GAAP Net Income to Adjusted EBITDA and Adjusted Net Income

(in thousands)

 

     Three Months Ended     Six Months Ended  
     June 30, 2016      June 30, 2015     June 30, 2016      June 30, 2015  

Net income

   $ 8,768       $ 3,560      $ 17,170       $ 8,464   

Non-GAAP adjustments:

          

Interest expense

     3,126         3,058        6,152         6,013   

Income tax expense

     6,400         3,074        12,279         6,974   

Depreciation expense

     168         61        275         108   

Amortization of intangible assets

     1,091         1,060        2,154         2,102   

Equity-based compensation expense

     1,090         650        2,169         1,438   

Founder contingent compensation

     —           4,601        —           9,203   

Transaction-related expenses:

          

IPO-related expenses (1)

     —           1,953        —           2,638   

Secondary equity offering-related expenses (2)

     615         —          615         —     

Acquisition-related expenses (3)

     474         395        474         395   

Executive recruitment (4)

     —           307        —           615   

Recapitalization expenses (5)

     —           91        —           91   
  

 

 

    

 

 

   

 

 

    

 

 

 

Adjusted EBITDA

   $ 21,732       $ 18,810      $ 41,288       $ 38,041   

Less:

          

Interest expense

     3,126         3,058 (2)      6,152         6,013   

Depreciation expense

     168         61        275         108   
  

 

 

    

 

 

   

 

 

    

 

 

 

Adjusted net income before taxes

     18,438         15,691        34,861         31,920   

Income tax expense above

     6,400         3,074 (3)      12,279         6,974   

Adjustments to income tax expense (6)

     736         2,580        1,220         4,937   
  

 

 

    

 

 

   

 

 

    

 

 

 

Adjusted income tax expense

     7,136         5,654        13,499         11,911   
  

 

 

    

 

 

   

 

 

    

 

 

 

Adjusted net income

   $ 11,302       $ 10,037      $ 21,362       $ 20,009   
  

 

 

    

 

 

   

 

 

    

 

 

 

Adjusted earnings per share- diluted

   $ 0.15       $ 0.13      $ 0.29       $ 0.27   
  

 

 

    

 

 

   

 

 

    

 

 

 

Weighted average common shares outstanding- diluted

     74,847,862         74,685,407        74,846,083         74,568,277   
  

 

 

    

 

 

   

 

 

    

 

 

 

 

(1) Includes legal and accounting fees paid in connection with the Company’s initial equity public offering (“IPO”), which closed in August 2015.
(2) Includes legal, accounting, printing and filing fees paid in connection with the Company’s secondary equity public offering, which closed in May 2016.
(3) Includes legal, accounting and consulting fees along with severance expenses and integration costs incurred in connection with our acquisition of the Oatmega and Paqui brands in April 2016 and April 2015, respectively.
(4) Represents the recognized expense associated with sign-on and retention bonuses for certain executive hires and certain recruiting fees. We are permitted to add back expenses of this type in determining Adjusted EBITDA under the Credit Agreement governing our term loan. Adjusted EBITDA (as defined therein) is used thereunder in determining our financial maintenance covenants and for calculating ratios in our debt incurrence covenants and is therefore an important measure of our financial performance and our ability to take certain actions in operating our business.
(5) Represents expenses we incurred in connection with a distribution paid in May 2015 to members of the former parent entity of the Company.
(6) The table below reflects an adjustment to income tax expense for the periods presented associated with addbacks to net income as presented in the table above.

 

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     Three Months Ended     Six Months Ended  
     June 30, 2016     June 30, 2015     June 30, 2016     June 30, 2015  

Adjustments to net income

   $ 3,270      $ 9,057      $ 5,412      $ 16,482   

Less:

        

Non-deductible equity-based compensation

     796        650        1,716        1,438   

Non-deductible IPO and secondary equity offering expenses

     615        1,891        615        2,577   
  

 

 

   

 

 

   

 

 

   

 

 

 

Permanent differences

     1,411        2,541        2,331        4,015   
  

 

 

   

 

 

   

 

 

   

 

 

 
     1,859        6,516        3,081        12,467   

Federal and state statutory rate, net of federal tax benefit for state tax expense

     39.6     39.6     39.6     39.6
  

 

 

   

 

 

   

 

 

   

 

 

 

Adjustments to income tax expense

   $ 736      $ 2,580      $ 1,220      $ 4,937   
  

 

 

   

 

 

   

 

 

   

 

 

 

 

9


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Amplify Snack Brands, Inc.

Reconciliation of GAAP Selling and Marketing and General and Administrative (“SG&A”) Expenses

to Adjusted SG&A Expenses

(In thousands)

 

     Three Months Ended     Six Months Ended  
     June 30, 2016     June 30, 2015     June 30, 2016     June 30, 2015  

SG&A

   $ 14,254      $ 17,001      $ 25,365      $ 29,651   

Less:

        

Depreciation expense

     (66     (12     (116     (13

Amortization of intangible assets

     (1,091     (1,060     (2,154     (2,102

Equity-based compensation expense

     (1,090     (650     (2,169     (1,438

Founder contingent compensation

     —          (4,601     —          (9,203

Transaction-related expenses:

        

IPO-related expenses (1)

     —          (1,953     —          (2,638

Secondary equity offering-related expenses (2)

     (615     —          (615     —     

Acquisition-related expenses (3)

     (474     (395     (474     (395

Executive recruitment (4)

     —          (307     —          (615

Recapitalization expenses (5)

     —          (91     —          (91
  

 

 

   

 

 

   

 

 

   

 

 

 

Adjusted SG&A

   $ 10,918      $ 7,932      $ 19,837      $ 13,156   
  

 

 

   

 

 

   

 

 

   

 

 

 

 

(1) Includes legal and accounting fees paid in connection with the Company’s initial equity public offering (“IPO”), which closed in August 2015.
(2) Includes legal, accounting, printing and filing fees paid in connection with the Company’s secondary equity public offering, which closed in May 2016.
(3) Includes legal, accounting and consulting fees along with severance expenses and integration costs incurred in connection with our acquisition of the Oatmega and Paqui brands in April 2016 and April 2015, respectively.
(4) Represents the recognized expense associated with sign-on and retention bonuses for certain executive hires and certain recruiting fees. We are permitted to add back expenses of this type in determining Adjusted EBITDA under the Credit Agreement governing our term loan. Adjusted EBITDA (as defined therein) is used thereunder in determining our financial maintenance covenants and for calculating ratios in our debt incurrence covenants and is therefore an important measure of our financial performance and our ability to take certain actions in operating our business.
(5) Represents expenses we incurred in connection with a distribution paid in May 2015 to members of the former parent entity of the Company.

 

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Section 5: EX-99.2 (EX-99.2)

EX-99.2

Exhibit 99.2

 

 

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Amplify Snack Brands Enters into Definitive Agreement to Acquire Tyrrells’ International Portfolio of Better-For-You, Premium Snack Brands

Diversifies and Expands Branded Product Offerings to Create an International Better-For-You Snacking Company with Approximately $317 Million in Pro Forma LTM Net Sales

Leverages Amplify’s and Tyrrells’ Market Leading Brands to Significantly Broaden Customer Reach and Increase International Operating Scale and Presence

Expected to be Accretive to Amplify’s 2017 and 2018 Diluted Earnings Per Share

Austin, Texas – August 8, 2016 – Amplify Snack Brands, Inc. (“Amplify” or the “Company”) (NYSE:BETR) and Crisps Topco Limited and Subsidiaries (“Tyrrells”) today announced that they have executed a definitive agreement under which Amplify will acquire Tyrrells, an international, market-leading and rapidly growing premium Better-For-You snack food business. The transaction has been unanimously approved by Amplify’s board of directors. Under the terms of the £300 million transaction, Tyrrells’ current owner Investcorp and members of the Tyrrells management team will receive approximately £278 million in cash and approximately 2.1 million shares of Amplify’s common stock.1 Amplify expects to close the transaction by the end of the third quarter of calendar 2016. Amplify expects that this acquisition will be accretive to both the Company’s 2017 and 2018 diluted earnings per share.

Founded in 2002 and headquartered in Herefordshire, England, Tyrrells is a diversified, international snacking company that manufactures and markets iconic, market-leading brands including Tyrrells Potato Crisps®, Tyrrells branded Vegetable Crisps, Tyrrells Poshcorn®, Tyrrells Nibbles®, Tyrrells Tortillas®, in the United Kingdom, Europe and many other international markets; Yarra Valley, manufacturer of Thomas Chipman and The Wholesome Food Company brands in Australia; and Aroma Snacks, manufacturer of Lisa’s kettle chips in Germany. Importantly, the product characteristics and flavor profiles of these on-trend premium brands align with Amplify’s Better-For-You snacking strategy. With distribution across a highly diverse set of international sales channels, Tyrrells generated approximately $111 million in net sales for the last twelve months (“LTM”) ended June 30, 2016, and achieved a compound annual net sales growth rate of 23% from fiscal year 2013 to fiscal year 2016. During the last twelve months ended June 30, 2016, Tyrrells generated approximately £18.3 in management presented EBITDA, as adjusted through due diligence in connection with the transaction.2 Tyrrells is the #2 player in the hand-cooked premium chip market in the UK and the #1 player in France, with existing and growing penetration in other key Western European markets. Tyrrells has a strong presence across the potato chip, vegetable chip, corn chip and popcorn product categories and is supported by five international manufacturing facilities in England, Germany, and Australia.

 

1  Share consideration is fixed based on closing August 5, 2016 Amplify’s stock price and GBP to USD exchange rate of 1.3042. There is no fixed exchange rate for the cash consideration component of purchase price but Amplify has hedged the majority of the cash consideration component.
2  See Appendix A to this release for additional detail on how this figure has been calculated. This figure includes, among other items, the estimated impact to Tyrrells consolidated EBITDA that would have been contributed by two businesses that Tyrrells acquired in August 2015 and March 2016, respectively, as if such businesses had been acquired as of the beginning of the period.


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“Together, Amplify and Tyrrells will partner to create a truly unique international Better-For-You snack food leader that can continue to drive robust future revenue and earnings growth,” said Tom Ennis, Amplify’s President and Chief Executive Officer. “We believe that the combination with Tyrrells will create significant long-term value for all of our stakeholders. Similar to Amplify, Tyrrells has a strong entrepreneurial spirit and successful track record of transforming categories and creating growth brands. We welcome David Milner and his team, and look forward to the opportunity to increase our operating scale, international reach, and product and brand diversity as we capture revenue synergies. We plan to capitalize on each company’s market leadership and sales forces to drive higher revenue growth than either company could independently accomplish.”

David Milner, Chief Executive Officer of Tyrrells commented, “We’re excited to join Amplify’s Better-For-You snack food platform as we combine our highly complementary businesses and brands to build an even stronger company for future international success. We were lucky enough to be able to choose our long-term partner and this partnership provides a significant opportunity to accelerate sales growth for Tyrrells’ brands in the United States, as well as the scope for Amplify’s brands in the international marketplace. Building upon the strength of each of our respective customer relationships and leveraging Tyrrells’ manufacturing capabilities, we shall be entering new territories as well as broadening our reach in existing markets.”

Strategic and Financial Benefits

The transaction will create a large and diversified pure-play international Better-For-You snack food company. Amplify believes the combination will provide the following strategic and financial benefits:

 

    Diversifies and Expands Better-For-You Branded Product Offerings: The combination of Amplify’s existing portfolio of brands including SkinnyPop, Paqui and Oatmega, with the leading international brands of Tyrrells, Thomas Chipman, Wholesome Goodness, and Lisa’s creates a combined international company with approximately $317 million in pro forma LTM net sales ended June 30, 2016. The acquisition creates a company with meaningful brand, product category, retail channel and geographic diversity. Following the closing of the transaction, Amplify’s North American footprint would represent approximately 63% of net sales, the United Kingdom would represent approximately 23% of net sales, and the Rest of the World would represent approximately 14% of net sales, based on pro forma net sales for the last 12 months ended June 30, 2016 for both companies.

 

    Accelerated International Expansion and Whitespace Realization: The acquisition of Tyrrells allows Amplify to more rapidly realize the opportunity provided by global Better-for-You snacking trends. Complementary distribution channels and sales teams provide actionable whitespace opportunities and potential to accelerate revenue growth for both Tyrrells’ and Amplify’s current brand portfolios. Minimal product and business overlap create two-way cross-sell opportunities to help accelerate entry into new markets and broaden reach in existing markets. Amplify will benefit from the presence of an international sales team with strong customer relationships in over 40 countries, while Tyrrells’ brands can leverage Amplify’s outstanding US-focused capabilities.


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    Increased Scale Provides Significant Future Benefits: In addition to benefitting from greater operating scale and increased procurement savings, Tyrrells’ outstanding manufacturing expertise and international capabilities will provide future cost benefits to the Company. Beyond these cost benefits, the combined company expects to realize additional benefits of scale via sharing of best practices, leveraging established infrastructure and strengthening retail partnerships.

 

    Addition of Experienced Executive Team: The transaction will add a talented group of executives, with strong international consumer packaged goods backgrounds and a proven track record of growth, to the core Amplify team. Upon closing of the transaction, Tyrrells’ management team will remain in place with David Milner continuing as President International for Amplify, reflecting his commitment and belief in the future success of the combined company. Other key members of Tyrrells’ senior management team will join Amplify to help manage the international brands and manufacturing operations.

Transaction Details

Under the terms of the transaction agreement, Tyrrells will become a wholly-owned subsidiary of Amplify. The transaction is valued at £300 million, comprising of approximately £278 million in cash and approximately 2.1 million shares of Amplify’s common stock issued to Investcorp and members of Tyrrells management team, valued at £22 million. Amplify plans to finance the cash portion of this transaction with debt and has secured financing commitments from Jefferies Finance LLC, Credit Suisse AG, Credit Suisse (USA) LLC, and Goldman Sachs Bank USA. Pro forma for the transaction, net leverage is expected to be approximately 5.7x.3 Amplify remains committed to maintaining long-term net leverage in the 4.0x to 4.5x range and expects to be well within that leverage range, via organic growth and subsequent free cash generation, by the end of 2017. The transaction is expected to close by the end of the third quarter of calendar 2016, subject to customary closing conditions including approval by regulators.

Advisors

Jefferies LLC is serving as financial advisor and Goodwin Procter LLP is acting as legal counsel to Amplify. Houlihan Lokey is serving as financial advisor and Shearman & Sterling LLP is acting as legal counsel to Investcorp and Tyrrells.

Conference Call and Webcast

The Company will host a conference call with members of the executive management team to discuss this transaction and its second quarter 2016 financial results today, Monday, August 8, 2016 at 7:00 a.m. Central time (8:00 a.m. Eastern time). Investors interested in participating in the live call can dial 877-407-9039 from the U.S. International callers can dial 201-689-8470.

 

3  The estimated pro forma net leverage ratio has been calculated as estimated net leverage at the closing of the transaction divided by the sum of (a) Amplify Adjusted EBITDA LTM ended June 30, 2016 plus (b) Tyrrells Diligence Adjusted Run-Rate EBITDA LTM ended June 30, 2016 plus (c) $1.0 million in estimated cost savings. See Appendix A to this release for additional information on how “Tyrrells Diligence Adjusted Run-Rate EBITDA” has been calculated.


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In addition, the call will be broadcast live over the Internet hosted at the “Investor Relations” section of the Company’s website at http://amplifysnackbrands.com.

The webcast will be archived for 30 days. A telephone replay will be available approximately two hours after the call concludes and will be available through Monday, August 18, 2016, by dialing 877-870-5176 from the U.S., or 858-384-5517 from international locations, and entering confirmation code 13641697.

About Amplify Snack Brands, Inc.

Headquartered in Austin, Texas, Amplify Snack Brands is a high growth snack food company focused on developing and marketing products that appeal to consumers’ growing preference for Better-For-You (BFY) snacks. Our brands SkinnyPop®, Paqui® and Oatmega® embody our BFY mission of “snacking without compromise” and have amassed a loyal customer base across a wide range of food distribution channels in the United States and Canada. For additional information, please visit: http://amplifysnackbrands.com.

About Crisps Topco Limited and Subsidiaries

Crisps Topco Limited and Subsidiaries (“Tyrrells”) is based on a farm in the picturesque countryside in the English county of Herefordshire and since its creation in 2002, has grown to become one of the UK’s best loved premium snack brands. The Tyrrells portfolio consists of award-winning Potato Crisps, Vegetable Crisps, ‘Furrows’ Crinkle Cut Crisps, Poshcorn - premium popcorn, and Tyrrells ‘Alternatives’. Tyrrells Crisps has recently scooped a Queens Award for Enterprise and is proud to hold over 64 gold Great Taste Awards, more than any other premium crisp producer.

Forward-Looking Statements

This press release contains certain forward-looking statements, including statements with regard to the proposed acquisition of Crisps Topco Limited and subsidiaries. Forward-looking statements generally relate to future events or our future financial or operating performance. In some cases, you can identify forward-looking statements because they contain words such as “may”, “will”, “should”, “expects”, “plans”, “anticipates”, “could”, “intends”, “target”, “projects”, “contemplates”, “believes”, “estimates”, “predicts”, “potential” or “continue” or the negative of these words or other similar terms or expressions that concern our expectations, strategy, plans or intentions. Forward-looking statements and the consummation of the proposed transaction and the terms thereof are subject to known and unknown risks and uncertainties and are based on potentially inaccurate assumptions that could cause actual results to differ materially from those expected or implied by the forward-looking statements. If any such risks or uncertainties materialize or if any of the assumptions prove incorrect, our results could differ materially from the results expressed or implied by the forward-looking statements we make.

The important factors that could cause actual results to differ materially from those in any forward-looking statements include, but are not limited to, the following: (i) our ability to successfully consummate the proposed acquisition of Crisps Topco Limited and subsidiaries on the terms described in this press release or at all, (ii) the satisfaction of all necessary closing conditions and approvals for the proposed acquisition, (iii) our ability to successfully integrate Crisps Topco Limited and subsidiaries with our existing operations following the consummation of the proposed acquisition, (iv) changes in consumer preferences and discretionary spending may have a material adverse effect on our brand loyalty, net sales, results of operations and financial condition, (v) we rely on sales to a limited number of distributors and retailers for the substantial majority of our net sales, and the loss of one or more


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such distributors or retailers may harm our business, and (vi) sales of a limited number of SkinnyPop products and flavors contributed all of our historical profitability and cash flow and a reduction in the sale of our SkinnyPop products would have a material adverse effect on our ability to remain profitable and achieve future growth.

Further information on these and other factors that could affect our financial results and the forward-looking statements in this press release are included in our Annual Report on Form 10-K for the year ended December 31, 2015 and our Quarterly Report on Form 10-Q for the quarter ended March 31, 2016, in each case, as filed with the Securities and Exchange Commission (“SEC”) and in other filings we will make with the SEC from time to time, particularly under the caption “Risk Factors”.

You should not place undue reliance upon forward-looking statements as predictions of future events. Amplify has based the forward-looking statements contained in this press release on its current expectations and projections about future events and trends that it believes may affect its business, financial condition, results of operations and prospects. The forward-looking statements made in this press release relate only to events as of the date on which the statements are made. Amplify undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as may be required by law.

Business and Financial Information of Crisps Topco Limited and Subsidiaries

This press release contains certain information regarding the business, operations and financial results of Crisps Topco Limited and its subsidiaries. This information has been prepared by Crisps Topco Limited and its subsidiaries, and not by Amplify. The financial results of Crisps Topco Limited and subsidiaries that are presented in this press release have been prepared by Crisps Topco Limited in accordance with generally accepted accounting principles in the United Kingdom (“UK GAAP”) and not generally accepted accounting principles in the United States (“US GAAP”). You should be aware that there are differences between UK GAAP (used by Crisps Topco Limited) and US GAAP (used by Amplify). If the proposed acquisition is consummated, Amplify will file with the Securities and Exchange Commission, within 71 calendar days following the date that Amplify is required to file a Current Report on Form 8-K announcing the consummation of the acquisition, the historical financial statements of Crisps Topco Limited and the pro forma financial information that is required under Regulation S-X.

The financial results of Crisps Topco Limited and subsidiaries have not been audited or reviewed by Amplify’s independent auditors. The historical past practices of Crisps Topco Limited and subsidiaries in the preparation of their historical financial statements may differ from the practices and interpretations applied by Amplify. As such, the historical financial results of Crisps Topco Limited and subsidiaries that are ultimately provided by Amplify or reflected in Amplify’s financial statements in future periods may vary from the information provided herein.

Crisps Topco Limited and subsidiaries have historically maintained a fiscal year end on or around March 31 (on a 52-week per year calendar), as compared to Amplify’s fiscal year end of December 31. To the extent necessary, the historical financial results of Crisps Topco Limited and subsidiaries have been calendarized to match Amplify’s fiscal year end, solely for presentation purposes.


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LTM and Pro Forma Financial Measures

This press release contains certain financial information that is presented as “LTM ended June 30, 2016” and/or “pro forma” for the proposed acquisition by Amplify of Crisps Topco Limited and subsidiaries.

“LTM ended June 30, 2016” financial information as used in this press release represents financial data (i) for Amplify, for the 12 months ended June 30, 2016, calculated by adding the financial data for the six months ended June 30, 2016 to the financial data for the year ended December 31, 2015 and subtracting the financial data for the six months ended June 30, 2015, (ii) for Crisps Topco Limited and subsidiaries, for the four quarters ended July 1, 2016, calculated by adding the financial data for the quarter ended July 1, 2016 to the financial data for the year ended April 1, 2016 and subtracting the financial data for the quarter ended June 26, 2015.

Unless otherwise indicated herein, “pro forma” financial information as used in this press release represents the arithmetic combination of the results of Amplify and Crisps Topco Limited and subsidiaries over the periods presented. In addition, the historical financial results of Crisps Topco Limited and subsidiaries have been converted from pounds sterling (£) to USD ($) based on a GBP / USD spot rate of 1.31 as of August 5, 2016, solely for presentation purposes.

Set forth below is a table showing the calculation of “Pro Forma LTM Net Sales” as presented in this release (all Tyrrells results converted to USD, dollars presented in millions, unaudited):

 

     Amplify      Crisps Topco Limited      Pro Forma  

Net Sales LTM ended June 30, 2016

   $ 206.5       $ 110.6       $ 317.1   

The “pro forma” financial information used in this press release does not represent pro forma financial information prepared in accordance with Article 11 of Regulation S-X. As noted above under Business and Financial Information of Crisps Topco Limited and Subsidiaries”, if the proposed acquisition is consummated, Amplify will file with the Securities and Exchange Commission, within 71 calendar days following the date that Amplify is required to file a Current Report on Form 8-K announcing the consummation of the acquisition, the pro forma financial information in respect of the proposed acquisition that is required under Regulation S-X.

Non-GAAP Financial Measures

This press release contains certain non-GAAP financial measures regarding Crisps Topco Limited. These non-GAAP financial measures, which include presentations of EBITDA and Adjusted EBITDA, have been presented in order to aid understanding in Crisp Topco Limited’s business performance. EBITDA and Adjusted EBITDA are explained and reconciled to net income, the closest comparable GAAP measure, in the tables contained in Appendix A to this release.

Amplify management and Crisps Topco Limited management believe that EBITDA and Adjusted EBITDA, which are non-GAAP financial measures, are meaningful to investors because they provide a view of our businesses with respect to ongoing operating results. EBITDA and Adjusted EBITDA are not and should not be considered alternatives to net income or any other figures calculated in accordance with GAAP, or as an indicator of operating performance. Amplify and Crisps Topco Limited’s method of calculation of EBITDA and Adjusted EBITDA may differ from methods used by other companies. Amplify management and Crisps Topco Limited management believes that these non-GAAP measurements are important to help gain an understanding of overall operating results in the periods presented. Such non-GAAP measurements are not recognized in accordance with GAAP and should not be viewed as an alternative to GAAP measures of performance.


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APPENDIX A

Crisps Topco Limited and Subsidiaries

Reconciliation of Net Income to Presentations of EBITDA and Adjusted EBITDA

 

     £ in Millions; Fiscal Year-End 3/31; Unaudited        
     2014A     2015A     2016A     LTM 6/30/2016  

Net Income

     (7.5     (9.5     (2.5     (2.8

Interest Expense (1)

     7.8        12.3        12.8        13.3   

Taxes

     (0.2     1.3        0.9        0.8   

Depreciation

     1.1        2.0        2.3        2.5   

Amortization

     2.7        4.0        —          —     

Other

     (0.0     (0.0     (0.1     (0.2
  

 

 

   

 

 

   

 

 

   

 

 

 

Statutory EBITDA (2)

   £ 3.8      £ 10.0      £ 13.4      £ 13.7   
  

 

 

   

 

 

   

 

 

   

 

 

 

Tyrrells Management Adjustments:

        

PF Impact of Yarra Valley and Lisa’s Acquisitions (3)

     0.7        1.6        1.5        1.3   

Constant Currency Adjustment

     (0.1     0.4        1.0        0.8   

Acquisition Related Costs (4)

     5.1        0.1        1.1        1.3   

Removal of Week 53 (5)

     —          —          (0.3     (0.3

Other Non-Recurring Adjustments (6)

     1.3        2.4        2.0        2.3   
  

 

 

   

 

 

   

 

 

   

 

 

 

Tyrrells Management Presented EBITDA

   £ 10.8      £ 14.5      £ 18.8      £ 19.1   
  

 

 

   

 

 

   

 

 

   

 

 

 

Diligence Adjustments:

        

Amplify Diligence Adjustments (7)

     (0.2     (0.3     (0.8     (0.7
  

 

 

   

 

 

   

 

 

   

 

 

 

Tyrrells Management Presented EBITDA, as Adjusted through Diligence

   £ 10.6      £ 14.2      £ 18.0      £ 18.3   
  

 

 

   

 

 

   

 

 

   

 

 

 

Run-Rate Adjustments:

        

Run-Rate Adjustments (8)

     —          —          —          1.0   
  

 

 

   

 

 

   

 

 

   

 

 

 

Tyrrells Diligence Adjusted Run-Rate EBITDA

   £ 10.6      £ 14.2      £ 18.0      £ 19.3   
  

 

 

   

 

 

   

 

 

   

 

 

 

 

1. Interest expense consists of (i) non-cash interest that was incurred by Tyrrells on certain related party debt obligations that were issued in connection with a previous restructuring of Tyrrells and (ii) cash interest paid by Tyrrells on its outstanding bank debt.
2. Statutory EBITDA includes EBITDA that was contributed by businesses acquired during the period solely from the date of the completion of such acquisitions forward.
3. Represents the estimated impact to Tyrrells’ consolidated EBITDA that would have been contributed by both the Yarra Valley and Lisa’s businesses as if such businesses had been acquired as of the beginning of each period. Yarra Valley was acquired by Tyrrells in August 2015 and Lisa’s was acquired by Tyrrell’s in March 2016. Does not represent pro forma financial information prepared in accordance with Article 11 of Regulation S-X.


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4. Represents non-recurring deal and diligence costs associated with the Investcorp, Yarra Valley, and Lisa’s acquisitions.
5. Normalized EBITDA for the impact of a 53 week fiscal year in 2016, as compared to other years that contain 52.
6. Represents other non-recurring adjustments such as one-time excess co-manufacturing costs incurred due to capacity constraints in popcorn and potato crisps, higher manufacturing costs associated with the production of potato crisps due to capacity constraints, other abnormal input costs, management reorganization costs, distributor breakage costs, and one-time legal and consulting fees.
7. Represents certain reversals to Management Adjustments that Amplify did not consider to be one-time in nature as well as a reclassification of an accrual.
8. Represents the run-rate impact of new secured distribution, new terms agreed to with customer, the full-year effect of new product listings and new customers, contracted input price increases / decreases, and incremental overhead required to deliver additional volumes.

CONTACT

Investors

ICR

Katie Turner

646-277-1228

katie.turner@icrinc.com

Media

ICR

Cory Ziskind

646-277-1232

cory.ziskind@icrinc.com

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Section 6: EX-99.3 (EX-99.3)

EX-99.3

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Lender Presentation August 2016 Exhibit 99.3


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Disclaimer This presentation and the accompanying oral presentation is solely for informational purposes and is intended to facilitate discussions with representatives of certain institutions regarding a potential debt financing of Amplify Snack Brands, Inc. (“Amplify” or “the Company”). Neither this presentation nor the accompanying oral presentation constitute an offer to purchase or sell, or a solicitation of an offer to purchase or buy, any securities of Amplify by any person in any jurisdiction, including the United States, in which is unlawful for such person to make an offer or solicitation. The recipient of this presentation has stated that it does not wish to receive material non-public information with respect to Amplify and acknowledges that other lenders have received a confidential supplement that contains additional information with respect to Amplify that may be material. Amplify does not take any responsibility for the recipient’s decision to limit the scope of the information it has obtained in connection with its evaluation of Amplify and the facilities described herein. This presentation and the accompanying oral presentation contain forward-looking statements within the meaning of federal securities laws, including statements with regard to the proposed acquisition by Amplify of Crisps Topco Limited and subsidiaries. Such forward-looking statements involve substantial risks and uncertainties. Forward-looking statements generally relate to future events or future financial or operating performance. In some cases, you can identify forward-looking statements because they contain words such as “may,” “will,” “should,” “expects,” “plans,” “anticipates,” “could,” “would,” “intends,” “target,” “projects,” “contemplates,” “believes,” “estimates,” “predicts,” “potential” or “continue” or the negative of these words or other similar terms or expressions that concern opportunities, prospects, future market size, expectations, strategy, plans or intentions. The expectations and beliefs of Amplify regarding these matters may not materialize, including the successful consummation of the proposed acquisition of Crisps Topco Limited and subsidiaries, and actual results in future periods are subject to risks and uncertainties that could cause actual results to differ materially from those expressed in the forward-looking statements, and you should not place undue reliance on our forward-looking statements. The forward-looking statements in this presentation and the accompanying oral presentation are based on information available to Amplify as of the date hereof, and Amplify disclaims any obligation to update any forward-looking statements for any reason, whether as a result of new information, future events or otherwise. This presentation and accompanying oral presentation contain certain information regarding the business, operations and financial results of Crisps Topco Limited and its subsidiaries. This information has been prepared by Crisps Topco Limited and its subsidiaries, and although Amplify believes the information regarding Crisps Topco Limited and its subsidiaries is accurate in all material respects, Amplify does not make any representation or warranty, express or implied, as to the accuracy, completeness or reliability of the information regarding Crisps Topco Limited and subsidiaries contained in this presentation or the accompanying oral presentation. The financial results of Crisps Topco Limited and subsidiaries that are presented in this presentation and accompanying oral presentation have been prepared by Crisps Topco Limited in accordance with generally accepted accounting principles in the United Kingdom (“UK GAAP”) and not generally accepted accounting principles in the United States (“US GAAP”). You should be aware that there are differences between UK GAAP (used by Crisps Topco Limited) and US GAAP (used by Amplify). The financial results of Crisps Topco Limited and subsidiaries have not been audited or reviewed by Amplify’s independent auditors. The historical past practices of Crisps Topco Limited and subsidiaries in the preparation of their historical financial statements may differ from the practices and interpretations applied by Amplify. As such, the historical financial results of Crisps Topco Limited and subsidiaries that are ultimately provided by Amplify or reflected in Amplify’s financial statements in future periods may vary from the information provided herein. Crisps Topco Limited and subsidiaries have historically maintained a fiscal year end on or around March 31 for a 52-week calendar year, as compared to Amplify’s fiscal year end of December 31. To the extent necessary, the historical financial results of Crisps Topco Limited and subsidiaries have been calendarized to match Amplify’s fiscal year end, solely for presentation purposes.


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Disclaimer (Cont.) This presentation and accompanying oral presentation also contain certain financial information that is presented as “LTM ended June 30, 2016” and/or “pro forma” for the proposed acquisition by Amplify of Crisps Topco Limited and subsidiaries. “LTM ended June 30, 2016” financial information as used in this presentation represents financial data (i) for Amplify, for the 12 months ended June 30, 2016, calculated by adding the financial data for the six months ended June 30, 2016 to the financial data for the year ended December 31, 2015 and subtracting the financial data for the six months ended June 30, 2015, (ii) for Crisps Topco Limited and subsidiaries, for the four quarters ended July 1, 2016, calculated by adding the financial data for the quarter ended July 1, 2016 to the financial data for the year ended April 1, 2016 and subtracting the financial data for the quarter ended June 26, 2015. The “pro forma” financial information used in this presentation does not represent pro forma financial information prepared in accordance with Article 11 of Regulation S-X. If the proposed acquisition is consummated, Amplify will file with the Securities and Exchange Commission, within 71 calendar days following the date that Amplify is required to file a Current Report on Form 8-K announcing the consummation of the acquisition, the pro forma financial information in respect of the proposed acquisition that is required under Article 11 of Regulation S-X. In addition, the historical financial results of Crisps Topco Limited and subsidiaries have been converted from pounds sterling (£) to USD ($) based on a GBP / USD spot rate of 1.31 as of August 5, 2016, solely for presentation purposes. For more information, see the Appendix to this presentation. This presentation and accompanying oral presentation contain certain non-GAAP financial measures regarding both Amplify and Crisps Topco Limited. These non-GAAP financial measures, which include presentations of EBITDA, Adjusted EBITDA and Adjusted EBITDA margin, have been presented in order to aid understanding in Amplify’s and Crisp Topco Limited’s business performance. Non-GAAP financial measures used in this presentation are not meant to be a substitute for comparable GAAP measures and are not intended to be considered in isolation from, in substitution for, or superior to our GAAP results. EBITDA and Adjusted EBITDA are explained and reconciled to net income, the closest comparable GAAP measure, in the tables in the Appendix to this presentation. This presentation and accompanying oral presentation also contain certain estimates and other information concerning our industries that are based on industry publications, surveys and forecasts. This information involves a number of assumptions and limitations, and we have not independently verified the accuracy or completeness of the information. All historical 2014 financial information for Amplify is based on the 2014 pro forma financial data as described in, and subject to the limitations in, Amplify’s public filings with Securities and Exchange Commission, including without limitation, Amplify’s Annual Report on Form 10-K for the year ended December 31, 2015. Amounts and percentages appearing in this presentation have been rounded to the amounts shown for convenience of presentation. Accordingly, the total of each column of amounts may not be equal to the total of the relevant individual items. All references to Amplify’s business and products (1) prior to April 2015 refer only to SkinnyPop, (2) for the period from April 2015 to April 2016 refer to SkinnyPop and Paqui and (3) after April 29, 2016, refer to SkinnyPop, Paqui and Boundless Nutrition. L52 is the financial data from the latest 52 weeks ending June 26, 2016. L12 is the financial data from the latest 12 weeks ending June 26, 2016.


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Today’s Presenters and Agenda Tom Ennis Chief Executive Officer Brian Goldberg Chief Financial Officer Presenters Agenda Transaction Overview 1 Introduction to Amplify Snack Brands 2 Financial Overview 5 Syndication Overview 6 Section Credit Highlights 4 Introduction to Tyrrells 3 Appendix 7 David Milner Chief Executive Officer of Tyrrells


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Transaction Overview


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Amplify Snack Brands, Inc. (“Amplify” or the “Company”) is a high growth and highly profitable snack food company focused on developing and marketing products that appeal to consumers’ growing preference for Better-For-You (“BFY”) snacks Current portfolio of brands are distributed throughout North America and includes: SkinnyPop, the #2 Ready to Eat BFY popcorn brand, as well as the Paqui and Oatmega Brands, which are complementary brands in large and growing BFY snacking segments The Company’s common stock trades on the NYSE under ticker BETR with a $1,034.4 million market capitalization(1) as of August 5, 2016 For the twelve months ended June 30, 2016 (“LTM”), the Company generated Net Sales and Adjusted EBITDA of $206.5 million and $78.1 million, respectively (37.8% margin) On August 6, 2016 Amplify entered into a definitive agreement to acquire Tyrrells for a total purchase price of £300.0 million Tyrrells is a diversified, premium BFY snack food company based in the UK that sells its products in over 40 countries The acquisition of Tyrrells provides Amplify with the opportunity to increase its scale, international reach, product and brand diversity and to capture revenue and operational synergies Amplify will raise $650.0 million of debt and issue 2.1 million shares of Amplify common stock to the sellers to finance the acquisition and refinance the Company’s existing debt $50.0 million 5-year senior secured revolving credit facility (unfunded at close) $600.0 million 7-year senior secured term loan Pro Forma for the Transaction, net leverage is 5.7x based on LTM 6/30/16 Pro Forma Combined Adjusted EBITDA of $104.4 million Transaction Overview Based on fully diluted shares outstanding of 75.1 million and closing price of $13.77


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Sources & Uses | Pro Forma Capitalization Note: Purchase price of £300 million converted to USD at August 5, 2016 spot rate of 1.31 USD / GBP Based on closing price of $13.77 as of August 5, 2016 and pro forma fully diluted shares outstanding of 78.4 million, which includes 2.1 million shares issued to sellers and 1.2 million RSUs issued to Tyrrells Management Defined as Net Debt / Total Enterprise Value


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Transaction Timetable Key Events Key Syndication Dates Tuesday, August 9th Lenders’ Meeting Wednesday, August 24th Lender Commitments Due Friday, August 26th Close and Fund August 2016 S M T W T F S   1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31                    


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Introduction to Amplify Snack Brands


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Amplify is at the Center of Key F&B Industry Trends Capitalizing on Major Growth Opportunity in BFY Snacking Focused exclusively on BFY Snacks Globally Millennial Snacking Trends BFY Segment Driving Snack Category Growth Increasing Snacking Frequency Convenience Multi-Channel Distribution Opportunity Consumer Demand for BFY Product Attributes AND Great Taste


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Nielsen Global Snacking Report, September 2014 Management estimates for traditional brands are based on Total Salty Snack expected growth and for BFY brands based on 2015 $ sales growth How America Eats – 2016 State of Snacking – IRI Mintel: A Snacking Nation, 9 July 2015 Large and Growing Snack Category(1) $ retail sales in billions Large and growing category[] Increased importance of snacking in consumer diets[] Emergence of millennials as heavy snackers Leading BFY Focused Snacking Platform Targeting a Large and Growing Category with Strong Market Tailwinds % YoY Growth 2% 2% Flat BFY brands out-pacing traditional brands by 3X(2) in U.S. IRI projects total U.S. Snacks to grow by +$35bn over next 5 years(3) 94% of all Americans snack at least once per day(4) 60% are looking for healthier options(4) BFY Snacking is Rapidly Growing % YoY Growth 2.0% 2.0%


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CAGR: 69% PEANUT & TREE NUT FREE CHOLESTEROL & TRANS FAT FREE NO ARTIFICIAL INGREDIENTS DAIRY AND GLUTEN FREE KOSHER BFY snacking platform Experienced management Established infrastructure Leading profitability and free cash flow SkinnyPop: Our cornerstone brand Embodies BFY mission Strong brand with significant growth headroom Paqui: Future growth driver BFY, flavored tortilla chips National roll-out began in 2016 Oatmega: Strong momentum Attacking large and growing BFY bar and cookie categories Unique products with roadmap to growth Rapidly Growing BFY Snack Food Company Unique Snacking Platform Premium BFY Brands Industry Leading Margins Are Fueling Cash Flow NON GMO NO PRESERVATIVES CAGR: 58% Adj. EBITDA Margin 44.5% 44.2% 40.7% 37.8% FCF Conv.(1) 98.2% 99.2% 99.0% 99.1% ($ in millions) Amplify is a Leader in BFY Snacks Net Sales Adj. EBITDA FCF Conversion defined as (Adj. EBITDA – Capex) / Adj. EBITDA


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Leading BFY Focused Snacking Platform Today… A Top 10 Domestic Salty Snack Dollar Manufacturer Source: IRI U.S. Multi-Outlet for latest 52wk ending June. 26, 2016 Note: Synder’s-Lance is pro forma for Diamond Foods acquisition Item productivity calculated as Total Dollar Sales / Avg # of Items Selling $10.4 B Amplify Snack Brands has room to grow in the salty snack category Dollar Growth - Amplify ranks 2nd Dollar Sales - Amplify ranks 8th Item Productivity(1) - Amplify ranks 2nd


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BFY Brands Are Growing ~3x Faster than Traditional(2) Attractive Snack Markets in the U.S. (1) SkinnyPop Has Cemented its Status as a RTE Popcorn Leader L52 market sizes based on IRI L52 June 26, 2016. Management estimates for traditional brands are based on Total Salty expected growth and for BFY brands based on 2015 $ sales growth Source: IRI US 2011 -2015 CAGR 2.8% 4.6% 3.9% 1.0% 15.9% 3.2% 4.5% LTM $ Share L52 $ retail sales in billions Other Brands: Multi-Outlet Channel $ weekly sales in millions(3) Leading BFY Focused Snacking Platform Amplify is Well Positioned in Large and Growing Categories with SkinnyPop Leading the Charge 29.1% 17.3% 5.6% 5.1%


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Source: U.S. Multi-Outlet + Convenience latest 52 weeks ending June 26, 2016 SkinnyPop proprietary usage and attitude study conducted September 30, 2015 with 1,615 consumers Source: U.S. Multi-Outlet + Convenience latest 12 weeks ending June 26, 2016 SkinnyPop Is Gaining Share in Fast-Growing RTE Popcorn(1)… …And Winning Share from Other Large Snacking Categories(2) Multi-Outlet + Convenience $ retail sales in billions % response to “What do you eat SkinnyPop instead of? Please select all that apply.” RTE Category Growth 9% 20% 23% 12% 15% SkinnyPop Share Total RTE Popcorn CAGR: 18% 9% 7% L12 RTE Popcorn Category Growth of 20.7%(3) L12 Market Share Increased to 19.1%(3) Strong Brand Appeal to Consumers Capitalize on RTE Popcorn Category Growth Through Continued Share Gains


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IRI Panel Total U.S. – All Outlets latest 52 weeks ending June 26. 2016 IRI Panel Total U.S. – All Outlets latest 52 weeks ending June 26. 2016. The top 25 salty snack brands are those brands with the highest dollar retail sales in the 52 week period according to IRI data Industry Leading Brand Loyalty(1) … % of customers repeat purchasing % households buying Tools for Growing Awareness Digital, Social & Influencers Sampling & Field Marketing …But Opportunity for Increased Household Penetration(2) Top 25 Salty Snack Brand Avg. (2) Strong Brand Appeal to Consumers Capitalize on SkinnyPop’s Leading Brand Loyalty to Drive Gains in Household Penetration


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IRI Panel Total U.S. – All Outlets latest 52 weeks ending June 26. 2016 Greatest Frequency of Purchase(1) Premium Price(1) Highest Total in Basket Spend(1) Average price per ounce Average number of trips per buyer per year Average in basket dollars per trip Strong Retail Relationships and Economics Retailers Value SkinnyPop’s Unit Economics and Consumer Demographics


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Retail Sales $ IRI L52(1) Customer A – Food(3) Customer C - Club(3) +32% +10% +18% % Change vs. YA 19.5% 54.0% 21.1% $ Retail Sales Market Share Total $ Retail Sales: $203M, +35% vs YA Total $ Retail Sales Market Share: 17.3% (2) 26% 44% 40% +304% 10.8% +106% 1.9% Customer Case Studies Customer B – Food(3) Customer D - Drug(3) 46% Source: IRI U.S. Multi-Outlet + Convenience for latest 52 weeks ending June 26, 2016 Costco is not included in the data set 3. Source: IRI U.S. Multi-Outlet + Convenience for latest 52 weeks ending Dec. 27, 2015 Strong Retail Relationships and Economics SkinnyPop Continues to Achieve Strong Growth Rates Across All Measured Channels


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Increased Distribution and Share of Shelf Distribution Gains with Room for Continued Expansion Significant Distribution Headroom Resulting in Ample Growth Runway Tools for Growing Distribution Effective Retail Merchandising Differentiated Packaging Total distribution points Avg. Top 25 Salty Snack Brands CAGR: 108% 2013A 2014A Current 2015A Additional Items on Shelf (1) IRI U.S. Multi-Outlet + Convenience latest 52 weeks ending June 26, 2016 Opportunity gap


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Strong Category Growth 1 Increase Distribution and Share of Shelf 2 Increase Household Penetration 3 New Product Innovation 4 5 International Expansion Multiple Levers for Profitable Growth 6 New Brands: Build or Buy Brand Focus Multiple Levers for Profitable Growth


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Introduction to Tyrrells


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Tyrrells Overview Diversified, International Snacking Company Iconic, market-leading brands Strong industry tailwinds Established international markets Tyrrells Brand: A Market Leader #2 premium, hand-cooked crisps brand in U.K. #1 premium, hand-cooked crisps brand in France(1) Distinctive and portable brand Exposure to growth segments Long-standing, diversified retailer base (largest branded customer accounts for <10% of sales)(2) Strong Manufacturing Expertise Five production facilities throughout England, Germany and Australia Ample Runway for Future Growth Recent acquisitions of high growth regional brands Continued penetration in U.K. Expand Australia / Asia business Amplify in US Adding Significant Top Line-Growth Truly International Snacking Platform (₤ in millions) (Fiscal year ending March 31) Business Diversity(2) Product Breakdown Retailer Breakdown Per management estimates Represents FY 2016 net sales for Tyrrells, Pro Forma for the acquisitions of Yarra Valley and Lisa’s Reported Net Sales CAGR: 25% Building on Amplify’s BFY Portfolio


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Tyrrells Overview Broad Brand Portfolio Distinctively British Branding Bold, iconic front of pack with bags of impact and standout Quirky photo brings the flavour to life with our trademark wit Strong and simple quality/provenance message Super-clear descriptor for easy range navigation Yarra Valley (Australia) acquired August 2015 Lisa’s (Germany) acquired May 2016 Bold, iconic front of pack with bags of impact and standout Quirky photo brings the flavor to life with Tyrrells’ trademark wit Strong and simple quality/provenance message Super-clear descriptor for easy range navigation Existing Markets Diverse International Footprint Diverse Geographic Breakdown(1) International markets account for 37% of net sales Represents FY 2016 net sales for Tyrrells, Pro Forma for the acquisitions of Yarra Valley and Lisa’s, whose sales are primarily in Australia and Germany, respectively


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Tyrrells Overview Note: Tyrrells crisps calculations includes Furrows. Rolling 52 weeks. L52 June 19, 2016. LTM ‘’14 – ’16 CAGRs represent volume growth. Market share includes Vegetable Chips Per management estimates Aligned with Large and Fast Growing Categories in the UK ₤3.3 billion UK salty snack category #2 player in Hand-Cooked with 25% share and 5% share of overall chips market(1) in UK Hand-Cooked growing quickly and taking share from traditional chips (+250 bps in last two years)(1) Tyrrells growing market share to 11% in the rapidly growing UK popcorn category, with 28% 2-year CAGR(1) Proven brand portability – #1 premium, hand-cooked chips brand in France(2) with strong acceptance internationally Meaningful Growth Opportunities Abroad Diverse Product Composition Category Size (₤ millions) LTM ’14 – ’16 CAGR Hand-Cooked Chips(1) ₤217 7.2% Tortilla Chips(1) ₤206 5.1% Popcorn(1) ₤88 25.6% Vegetable Chips(1) ₤16 11.2% Tyrrells Taking Share in Hand-Cooked Chips(1) 19.2% 25.1%


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Combination of Two Leading BFY Snacking Platforms $200+ million in revenue $100+ million in revenue


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Transaction Rationale Iconic core brand and geographically diversified BFY snack portfolio complements Amplify’s strategy Acquisition provides meaningful brand, category and geographic diversity Creates a meaningful international player in BFY snacking with another platform for substantial growth Complementary distribution channels provide two-way cross-sell opportunities, accelerating entry into new markets Tyrrells’ outstanding manufacturing expertise and capabilities provide future cost-saving opportunities Current Amplify Snack Brands1 62% Ease of integration due to minimal business overlap Adds additional talented, proven professionals to the Amplify platform Strengthens existing relationships with retailers due to strong brand appeal in multiple categories


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Credit Highlights


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Strong Acquisition Track Record Leading BFY Focused Snacking Platform Improved Brand, Geographic and Retailer Diversity Experienced and Proven Management Team 7 Credit Highlights Strong Historical Financial Performance and Industry Leading Margins Significant Free Cash Flow Drives Rapid Deleveraging Significant Whitespace for Future Growth 1 2 4 5 6 3


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Source: IRI L52 June 26, 2016 Per management estimates ` SkinnyPop Paqui Oatmega & Perfect Cookie Large addressable market of $4.9B, which grew at +4.8% CAGR from 2010 to 2015 No current leader in fragmented BFY tortilla chip market, creating significant opportunity for growth Fastest Growing Brand in RTE Category +35% in $ Sales Strong Position Within RTE Popcorn Category #2 Strong Share Growth in RTE Category +2.5pts to 17.3 % / $ Share Industry Leading On-Shelf Productivity 1.4 x and 4.0 x higher than next 2 brands Highest Level of Brand Loyalty in RTE Popcorn Sub-segment 62% Continued innovation in 2016 Flavors, Forms and Holiday Special Packs Oatmega competes in attractive snack category with a large market size of $5.9B and growth of +4.6% High-quality ingredients aligned with Amplify’s product portfolio Strong national launch in 2016 Strong customer acceptance 26% ACV L52 Continued distribution build Sales and marketing efforts underway to drive consumer trial Entry point into the healthy cookie sub-segment Great taste Strong customer momentum Tyrrells Long-established brand that is #2 player in hand-cooked premium crisp market in the UK and the #1 in France(1) Premium brands with flavor profile and product characteristics that align with Amplify’s mission 25% annual net sales CAGR from FY 2013 to LTM 6/30/16 Strong existing and growing penetration in key Western European markets with ample room to grow Brand successfully extended to veg crisps and popcorn products Significant international reach Yarra Valley (Thomas Chipman & The Wholesome Food Company) Lisa’s Paqui Oatmega Competes in attractive US snack bar category with market size of $6.0B and growth of +4.8% High quality ingredients, great taste and strong customer momentum $5.0B US tortilla chip category grew at +4.6% CAGR from 2011 to 2015 Significant customer acceptance after Q1 2016 national launch Complementary organic kettle chip brand based in Germany Provides continental European sales and manufacturing presence Natural / organic brands across corn chip, vegetable chip, potato chip and popcorn categories Provides access to Australasian markets and existing infrastructure Leading BFY Focused Snacking Platform The Amplify Family of Brands 1


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Net Sales Adj. SG&A(2) Adj. EBITDA SG&A % of Net Sales(2) 14.1% 12.3% 15.3% 16.8% 17.3% Adj. EBITDA Margin 44.5% 44.2% 40.7% 37.8% 31.4% $ in millions CAGR: 82% $ in millions $ in millions CAGR: 58% Strong Historical Financial Performance and Industry Leading Margins 2013A 2014PF 2015A 2016 PF 2016 Q2 LTM Q2 LTM 2013A 2014PF 2015A 2016 PF 2016 Q2 LTM Q2 LTM Adj. EBITDA(1) $ in millions 2013 – LTM Net Sales CAGR(3)(4) LTM Adj. EBITDA Margin(3) Source: Company filings. Selected High Growth Consumer Company Median consists of the median for Monster, Blue Buffalo, Boston Beer, WhiteWave, Freshpet and Hain Celestial Selected Snacking Company Median consists of the median for B&G Foods, Pinnacle Foods, Flowers Foods, Snyder’s-Lance Pro forma Q2 2016 LTM Adjusted EBITDA includes $1 million in cost synergies. Refer to reconciliation in appendix Not meaningful as Tyrrells’ net sales are as reported and Tyrrells’ Adjusted EBITDA is adjusted for pro forma impact of acquisitions and constant currency High Growth Consumer and Selected Snacking medians calculated through LTM Q1 except for Boston Beer, B&G Foods and Pinnacle Foods, which are Q2 LTM Tyrrells’ net sales CAGR represents FY 2013 – LTM. Tyrrells’ fiscal year ends March 31st 2 YoY Growth 137.6% 39.0% 26.8% CAGR: 69% Adj. EBITDA Margin 44.5% 44.2% 40.7% 37.8% NM(2) CAGR: 58%


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Strong Financial Performance $ in millions (1) Tyrrells historical net revenues calendarlized to match Amplify’s fiscal year 2 Both Amplify and Tyrrells have had strong, consistent growth in LTM Net Revenue since Q4 2014


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Strong Cash Flow and Liquidity Source: Company filings. Selected High Growth Consumer Company Median consists of the median for Monster, Blue Buffalo, Boston Beer, WhiteWave, Freshpet and Hain Celestial Selected Snacking Company Median consists of the median for B&G Foods, Pinnacle Foods, Flowers Foods, Snyder’s-Lance Pro forma Adjusted EBITDA includes $1 mm in cost synergies. Refer to reconciliation in appendix Adjusted EBITDA – Capex conversion defined as (Adjusted EBITDA – Capex) / Adjusted EBITDA High Growth Consumer and Selected Snacking medians calculated through LTM Q1 except for Boston Beer, B&G Foods and Pinnacle Foods, which are Q2 LTM Significant Free Cash Flow Drives Rapid Deleveraging LTM Adj. EBITDA – Capex Conversion(1)(2)(3) 3 Q2 2016 LTM PF Comb. Q2 2016 LTM Adjusted EBITDA – Capex(1) $ in millions CAGR: 59% Capex $0.5 $0.5 $0.8 $0.7 $15.1


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Improved Brand and Geographic Diversity Pro Forma Net Sales by Brand(1) Pro Forma Net Sales by Geography(1) BFY snacking platform Iconic brands with leadership positions in multiple markets around the world Experienced management and established infrastructure Strong profitability and free cash flow conversion SkinnyPop: Our cornerstone brand High margin, premium profile brand Strong brand with significant U.S. and international headroom Tyrrells: International BFY snack brand Diversified, premium snack food company in UK, EU and Asia Multi-market exposure and leadership positions Regional BFY brand portfolio Including Lisa’s, Oatmega, Paqui, Thomas Chipman and Wholesome Food Company Targeting large international BFY markets across multiple categories Opportunity to meaningfully enhance portfolio contribution over time International BFY Snacking Platform 4 Pro Forma LTM Q2 2016 net sales


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Diversifying Retailer Base Selected Retail Relationships Around the World 4 Strong Retailer Relationships Internationally BFY Snack Solution Provider Existing Markets A Truly International Footprint Costco


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Robust growth, facilitated by national launch in 2016 . Fast Integration and Strong National Launch Fully integrated into financial and business processes Improved profitability Improved ingredient deck New price/pack combinations New packaging 21 new SKUs New signature flavor ‘Nacho Cheese Especial’ Tier I co-manufacturing with large national network Significant customer acceptance 2016 national launch Strong marketing program to gain awareness and trial Successful Traction with Customers Change in Points of ACV(1) IRI Panel Total U.S. – Multi Outlet + Convenience latest 52 weeks ending June 26, 2016 Adoption by Customers Across All Channels Selected Customers Strong Acquisition Track Record Paqui Amplified – A Case Study 5 Refreshed Packaging Launching 2H 2016


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Strong Acquisition Track Record Oatmega: Amplifying Great Brand Momentum Company Description Manufactures and distributes a broad range of Oatmega® bars products through a variety of retail formats nationally LTM sales with over 100% year-over-year growth Oatmega has 4 and 9 facings at Walmart and Target, respectively Acquisition funded with cash on hand, seller notes, and revolver draw Alignment with Amplify’s BFY Portfolio Strong fundamentals in $6.0B snack bar market, which grew 4.8% from prior year period(1) Attractive option for millennials and families 79% of Millennials ages 25-34 consume snack bars(2) 77% of adults buy snack bars for their children(2) On-the-go protein option with high-quality ingredients Bar consumers rank Protein and Fiber as the two most essential nutrition attributes(2) Excellent flavor profile and strong momentum with health conscious consumers Non-GMO, Grass-Fed Whey with 300mg of fish oil per bar IRI MULO + C, L52 Week Data ending 26 June 2016 Mintel: Snack, Nutrition, & Protein Bars, March 2015 5


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Strong Category Growth 1 Increase Distribution and Share of Shelf 2 Increase Household Penetration 3 New Product Innovation 4 5 International Expansion Multiple Levers for Profitable Growth 6 New Brands: Build or Buy Brand Focus Multiple Levers for Profitable Growth 6


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Nielson Global Snacking Report September 2014 Global Snack Markets by Region(1) Key Acquisition Criteria BFY snacking Exceptional taste profile Distinct BFY characteristics Premium brand Unique brand, product and positioning Some proof of concept at retail Meaningful revenue and margin opportunities Leverages existing infrastructure and expertise $ retail sales in billions Significant Whitespace for Future Growth Significant Opportunities to Enter Adjacent Markets via New Brands: Build or Buy 6


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Chief Executive Officer Chief Financial Officer Executive Vice President of Sales & Marketing Chief Executive Officer (Tyrrells) / International President, Amplify - Proposed Group Operations Director (Tyrrells) / Vice President of Manufacturing, Amplify - Proposed Senior Vice President of Supply Chain 20 years of experience 18 years of experience 20 years of experience 30 years of experience 18 years of experience 25 years of experience Note: Logos are representative of selected prior professional experience Tom Ennis Brian Goldberg Jason Shiver Stuart Telford Steve Galinski Experienced and Proven Management Team David Milner 7


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Financial Overview


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Note: PF Combined Q2 2016 LTM Adjusted EBITDA margin is NM as net sales are actual and Tyrrells EBITDA is adjusted for PF impact of acquisitions and constant currency Pro forma Q2 2016 LTM Adjusted EBITDA includes $1 million in cost synergies. Refer to reconciliation in appendix Not meaningful as Tyrrells’ net sales are as reported and Tyrrells’ Adjusted EBITDA is adjusted for pro forma impact of acquisitions and constant currency Adjusted EBITDA – Capex conversion defined as (Adjusted EBITDA – Capex) / Adjusted EBITDA Adj. Gross Profit Adj. SG&A SG&A % of Net Sales(2) 14.1% 12.3% 15.3% 16.8% 17.3% $ in millions CAGR: 82% $ in millions CAGR: 64% Track Record of Strong Growth and Compelling Financial Profile Adj. Gross Margin 58.6% 56.5% 56.1% 54.6% 50.0% 2013A 2014A 2015A 2016 PF 2016 Q2 LTM Q2 LTM 2013A 2014A 2015A 2016 PF 2016 Q2 LTM Q2 LTM Net Sales YoY Growth 137.6% 39.0% 26.8% $ in millions CAGR: 69% Adj. EBITDA(1) Adj. EBITDA Margin 44.5% 44.2% 40.7% 37.8% NM(2) $ in millions CAGR: 58% (2) (2)(3) Adjusted EBITDA – Capex(1) $ in millions Adjusted EBITDA – Capex Conversion(1)(3) Capex $0.5 $0.5 $0.8 $0.7 $15.1 CAGR: 59%


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Strong Year-to-Date 2016 Financial Performance Q2 Results Net Sales $ in millions $ in millions Gross Margin 56.8% 56.5% 54.2% Gross Profit Adj. EBITDA $ in millions Adj. EBITDA Margins 47.9% 39.7% 36.2% CAGR 30% CAGR 27% CAGR13%


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Amplify plans to maintain a conservative financial policy and consistently de-lever throughout the projected period The Company expects to utilize strong free cash flow generation to paydown a significant portion of the Senior Secured Term Loan over the next 3 years Target leverage of 4.0x to 4.5x over the intermediate term The Company will continue to examine its leverage profile and maintains the ability to opportunistically issue equity to de-lever or finance future acquisitions Long-term Amplify plans to remain opportunistic as it relates to its acquisition policy, however will focus on integrating Tyrrells through 2017 Future acquisitions will continue to focus on diversifying the Company’s product and geographic portfolio within the BFY market Strong liquidity is underpinned by: $50 million in revolver availability throughout the projected period The Company expects minimum cash of $10 million over the projected period The Company does not plan on utilizing free cash flow generation to fund dividends or share repurchases The Combined Company’s financial policy is designed to ensure sustainable growth while focusing on meaningful de-leveraging Leverage Acquisition Policy Liquidity Management Dividends / Share Repurchases Conservative Financial Policy & Significant Liquidity


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Strong Acquisition Track Record Leading BFY Focused Snacking Platform Improved Brand, Geographic and Retailer Diversity Experienced and Proven Management Team 7 Credit Highlights Strong Historical Financial Performance and Industry Leading Margins Significant Free Cash Flow Drives Rapid Deleveraging Significant Whitespace for Future Growth 1 2 4 5 6 3


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Syndication Overview


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Summary Financing Terms Senior Secured Credit Facilities Revolving Credit Facility First Lien Term Loan Borrower/Issuer Amplify Snack Brands, Inc. Guarantors Parent and each existing and subsequently acquired or organized wholly-owned domestic subsidiaries (subject to customary exceptions) Security First lien on substantially all assets of the Borrower and guarantors (subject to customary exceptions), including but not limited to 100.0% of capital stock directly held by the Borrower and any Guarantor limited to 65.0% of the voting stock of foreign subsidiaries Amount $50 million $600 million Maturity 5 years 7 years Amortization Schedule None 1.0% per annum LIBOR Floor None 1.0% Optional Redemption N/A 101 soft call for 6 months Mandatory Repayment N/A 50% excess cash flow sweep with step-downs to 25% and 0% at TBD leverage levels; 100% of asset sales; 100% of debt issuances Financial Covenants Springing First Lien Net Leverage Ratio None Affirmative and Negative Covenants Customary for facilities of this type


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Legal Structure Paqui, LLC (Texas) SkinnyPop Popcorn, LLC (DE) UK Bidco (UK) Target (UK) Boundless Nutrition, LLC (TX) Target Sub (UK) Target Foreign Subsidiaries Borrower Subsidiaries Legend: $50 million Revolver $600 million Term Loan LuxCo1 (Luxembourg) LuxCo2 (Luxembourg) Irish NewCo (Ireland) LuxCo3 (Luxembourg) Amplify Snack Brands, Inc. (DE)


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Questions & Answers


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Appendix


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The Tyrrells management team will be retained to run the Tyrrells / European / Australasia business going forward The Tyrrells team is viewed favorably by Amplify management and has significant experience operating in the international market Tyrrells’ ongoing management compensation aligns with long-term Amplify performance Amplify has conservatively projected $1.0 million of net synergies, achievable in FY17 Projected synergies are associated with procurement cost savings for the combined company Management believes there are further revenue and cost related synergies, such as the ability to leverage scale to lower professional fee rates or marketing costs, etc., but has not factored these into the projection model Acquiring a self-sustaining business unit that can be run on standalone basis with no forced integration timeline The combination results in an international salesforce and manufacturing footprint to support international growth Additionally, Tyrrells manufacturing expertise creates an opportunity for Amplify to expand manufacturing into the U.S., which will help drive margin improvement Management Team Synergy & Value Capture Organization / Manufacturing Integration Strategy


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Historical Capital Expenditures $ in millions Note: Tyrrells growth capex higher than usual in FY 2016 and LTM 6/30/16 due to one-time infrastructure investments in manufacturing facilities both in the UK and in connection with the recent acquisitions of Yarra Valley and Lisa’s LTM 6/30/2016 maintenance and growth capital expenditures calculated using FY16 proportion of maintenance vs. growth Tyrrells Historical Capex Amplify Historical Capex (1) (Fiscal Year ending 12/31) (Fiscal Year ending 3/31)


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1. Reflects the elimination of the $0.4 million increase in cost of goods sold related to the Sponsor Acquisition. 2. Represents compensation expense associated with the Founder Contingent Compensation of $8.4 million recorded in the period from July 17, 2014 to December 31, 2014, and $18.4 million reflected as a component of general & administrative expenses in the Pro Forma Year Ended December 31, 2014 (Unaudited). 3. Represents $0.5 million of predecessor transaction costs. 4. Represents the expenses incurred in connection with the December 2014 and May 2015 Special Dividends. 5. Represents the recognized expense associated with sign-on and retention bonuses for certain executive hires and certain recruiting fees. 6. Includes performance bonuses and related payroll taxes paid to employees upon the completion of the IPO, a financial advisory fee paid to an advisor in connection with the IPO, and legal, accounting, consulting, printing, filing and listing fees paid in connection with the IPO process. 7. Represents transaction costs associated with legal and accounting services. 8. Represents severance expenses related to the acquisition of Paqui. We are permitted to add back expenses of this type in determining Adjusted EBITDA under the credit agreement governing our term loan $ in millions Amplify Reconciliation of Net Income to Pro Forma Combined Adjusted EBITDA Source: Company filings and Tyrrells EBITDA reconciliation Reflects the elimination of the $0.4 million increase in cost of goods sold related to the Sponsor Acquisition. Represents compensation expense associated with the Founder Contingent Compensation of $8.4 million recorded in the period from July 17, 2014 to December 31, 2014, and $18.4 million reflected as a component of general & administrative expenses in the Pro Forma Year Ended December 31, 2014 (Unaudited). Represents $0.5 million of predecessor transaction costs. Includes performance bonuses and related payroll taxes paid to employees upon the completion of the IPO, a financial advisory fee paid to an advisor in connection with the IPO, and legal, accounting, consulting, printing, filing and listing fees paid in connection with the IPO process. Represents transaction costs associated with legal and accounting services. Represents the recognized expense associated with sign-on and retention bonuses for certain executive hires and certain recruiting fees. Represents the expenses incurred in connection with the December 2014 and May 2015 Special Dividends. Represents severance expenses related to the acquisition of Paqui. We are permitted to add back expenses of this type in determining Adjusted EBITDA under the credit agreement governing our term loan


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Source: Financials provided by Tyrrells’ management and reviewed and adjusted by Amplify management with the help of third-party service providers. Interest expense consists of (i) non-cash interest that was incurred by Tyrrells on certain related party debt obligations that were issued in connection with a previous restructuring of Tyrrells and (ii) cash interest paid by Tyrrells on its outstanding bank debt. Statutory EBITDA includes EBITDA that was contributed by businesses acquired during the period solely from the date of the completion of such acquisitions forward. Represents the estimated impact to Tyrrells’ consolidated EBITDA that would have been contributed by both the Yarra Valley and Lisa’s businesses as if such businesses had been acquired as of the beginning of each period. Yarra Valley was acquired by Tyrrells in August 2015 and Lisa’s was acquired by Tyrrell’s in March 2016. Does not represent pro forma financial information prepared in accordance with Article 11 of Regulation S-X. Represents non-recurring deal and diligence costs associated with the Investcorp, Yarra Valley, and Lisa’s acquisitions. Normalized EBITDA for the impact of a 53 week fiscal year in 2016, as compared to other years that contain 52. Represents other non-recurring adjustments such as one-time excess co-manufacturing costs incurred due to capacity constraints in popcorn and potato crisps, higher manufacturing costs associated with the production of potato crisps due to capacity constraints, other abnormal input costs, management reorganization costs, distributor breakage costs, and one-time legal and consulting fees. Represents certain reversals to Management Adjustments that Amplify did not consider to be one-time in nature as well as a reclassification of an accrual. Represents the run-rate impact of new secured distribution, new terms agreed to with customer, the full-year effect of new product listings and new customers, contracted input price increases / decreases, and incremental overhead required to deliver additional volumes. Tyrrells Reconciliation of Net Income to Diligence Adjusted Run-Rate EBITDA

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