Philip Morris International Inc 8-K, filed Jul 7, 2021

Philip Morris International Inc. (PM)

8-K 2021-07-07 For: 2021-06-30

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Added on April 02, 2026

About this 8-K

Philip Morris International Inc filed this 8-K on July 7, 2021, reporting on events of June 30, 2021.

Items reported

Item 1.01: Entered into a material agreement
Item 7.01: Regulation FD disclosure
Item 9.01: Financial statements and exhibits

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PHILIP MORRIS INTERNATIONAL INC.

By:						/s/ DARLENE QUASHIE HENRY
Name:						Darlene Quashie Henry
Title:						Vice President, Associate General Counsel & Corporate Secretary


			Page
1 DEFINITIONS, INTERPRETATION AND ENTIRE AGREEMENT			4
2 PURPOSE AND BACKGROUND			16
3 SALE AND PURCHASE OF SHARES			17
4 PURCHASE PRICE			17
5 LEAKAGE			17
6 CONCLUSION OF AGREEMENT			19
7 PRE-CLOSING COVENANTS AND ACTIONS			20
8 COOPERATION COVENANTS			23
9 CLOSING CONDITIONS			25
10 TERMINATION			25
11 CLOSING MECHANICS			26
12 ACTIONS AFTER CLOSING			28
13 DUE DILIGENCE REVIEW			29
14 WARRANTIES			30
15 TAX INDEMNITY			31
16 THE SELLERS' LIABILITY TO COMPENSATE THE BUYER			32
17 LIMITATIONS			33
18 CLAIMS PROCEDURE			35
19 RESTRICTIVE COVENANTS			36
20 CONFIDENTIALITY AND PUBLICATION			37
21 ASSIGNMENT			38
22 GOVERNING LAW AND DISPUTES			39
23 OTHER PROVISIONS			39



Schedule A:			List of the Minority Shareholders and Ownership of Shares

Schedule B:			Sellers’ Representative’s Bank Account

Schedule C:			Transaction Bonus Agreements

Schedule 1.1(a):			Equity Bridge

Schedule 1.1(b):			Locked Box Accounts
Schedule 1.1(c)			List of Subsidiaries

Schedule 1.1(d):			W&I Insurance Policy

Schedule 6.1(a):			Documents evidencing each of the Majority Sellers' authority to execute the Agreement

Schedule 6.2(a):			Documents evidencing the Buyer's authority to execute the Agreement and approval of the Agreement
Schedule 6.2(b):			Parent Company Letter

Schedule 6.2(c):			Signing No Claims Declaration

Schedule 7.3.2:			Form of Drag-Along Notice

Schedule 7.3.3:			Form of Drag-Along Acknowledgement

Schedule 7.5.1			Handling of Customers

Schedule 13.1(a):			Due Diligence Information (including Q&A spreadsheet)

Schedule 13.1(b):			Due Diligence Meetings

Schedule 14.1:			Sellers' Warranties (included in Exhibit 2.1 Form 8-K filing)

Schedule 19.5:			List of current related activities of Bagger Sørensen, Claus Bagger-Sørensen and Steen Bagger-Sørensen as of the Signing Date

Schedule 20.2:			Respective Press Releases

Schedule 23.1:			Addresses for Notice


Accounting Principles			the Company’s accounting principles as described in the Annual Report.
Accounts Date			31 December 2020.
Affiliate			with respect to any Person, any other Person directly or indirectly Controlling, Controlled by or under common Control with such Person.


Agreement			this share sale and purchase agreement, including all Schedules and Appendices hereto which are hereby incorporated by reference herein.
Annual Report			the Company's consolidated and audited annual report as at the Accounts Date regarding the Group Companies.


☐			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))


Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).


If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.			☐


2.1			Share Sale and Purchase Agreement by and among Claudio Topco B.V., Bagger-Sorenson & Co. A/S and PMI Global Services, Inc., dated June 30, 2021 (portions of this Exhibit 2.1 have been omitted).


99.1			Philip Morris International Inc. Press Release, dated July 1, 2021.


104			Cover Page Interactive Data File (the cover page XBRL tags are embedded within the Inline XBRL document and contained in Exhibit 101).



			SHARE SALE AND PURCHASE AGREEMENT

			concerning Claudio HoldCo A/S (Certain identified information in this Exhibit 2.1 has been excluded because it is both (i) not material and (ii) would likely cause competitive harm to the registrant if publicly disclosed. [***] Indicates that information has been redacted.)


Breach			any breach of Warranty or failure to fulfil any obligation under the Agreement.
Bring Down of Disclosures			a review immediately prior to the Closing Date of the Sellers' Warranties given at Closing by the Persons comprised by the definition of Sellers' Knowledge with a view to identifying any facts or circumstances, if any, arising between the Signing Date and the Closing Date, constituting a Breach of any of the Sellers' Warranties given at Closing.
Business Day			any day on which commercial banks in Denmark are generally open for business (except for banking business being conducted exclusively through the internet).
Buyer's Advisors			DLA Piper, Gorrissen Federspiel, KPMG and Niras.


Item 1.01.			Entry into a Material Definitive Agreement.


Item 7.01.			Regulation FD Disclosure.


Item 9.01.			Financial Statements and Exhibits.


(d)			Exhibits.


Buyer's Knowledge			the Actual Knowledge as defined in the W&I Insurance Policy as of the Signing Date of those persons included in the “Deal Team Members” as defined in the W&I Insurance Policy.
Buyer’s Leakage Notice			as described in clause 5.4.
Claim			any claim for indemnification of a Loss raised by a Party against the other Party based on an alleged Breach.


Claudio BidCo			Claudio BidCo A/S, CVR no. 38 20 50 72, c/o Fertin Pharma A/S Dandyvej 19, 7100 Vejle, Denmark.
Closing			the completion by the Parties of the transactions contemplated by this Agreement by their mutual fulfilment of the obligations described in clause 11.
Closing Date			the date on which Closing takes place; see clause 11.1.
Closing Memorandum			minutes of the meeting at which Closing takes place.
Closing No Claims Declaration			as set out in the W&I Insurance Policy.
Co-Investor SHA			the Co-Investor Shareholders' Agreement dated 17 January 2017 entered into by and between Claudio Topco, Bagger-Sørensen and each of the Minority Shareholders regarding their ownership of shares in the Company.
Company			Claudio HoldCo A/S, CVR no. 38 20 44 24, c/o Fertin Pharma A/S Dandyvej 19, 7100 Vejle, Denmark.
Competition Authorities			includes the Bundeswettbewerbsbehörde of Austria, the Conselho Administrativo de Defesa Econômica of Brazil, the Hellenic Competition Commission of Greece and the Irish Competition and Consumer Protection Commission (or related authorities) and/or, if applicable, the EU Commission and/or the UK Competition and Markets Authority.
Control			the ownership of more than 50% of the outstanding voting securities in a legal entity, the right to elect or remove the majority of the members of the board of directors (save for such members who are elected or appointed by the employees of such legal entity or by organisations of employees) and/or the ability in fact to cause the direction of the management of such legal entity, whether through ownership of voting securities, by contract or otherwise. The terms "Controlling", "Controlled" and similar words shall be construed accordingly.


Corporate Documents			the charter and other documents by which any Person (other than an individual) establishes its legal existence or which govern its corporate affairs, including its articles of incorporation and articles of association.
Disclosed			any and all information fairly disclosed in the Due Diligence Information or otherwise in writing and in the relevant context that would allow a diligent Person skilled in the field to which the information relates to reasonably discern the relevance of such matter, including the substance of any potential claim, loss, liability or disadvantage based on reading and analysing said information, taking into consideration that the Buyer is a professional buyer and in each case without the need to draw conclusions from several unrelated documents or materials in the Due Diligence Information.
Dispute Notice			as described in clause 5.4.
DKK			Danish Kroner, the valid currency of Denmark.
Due Diligence Information			the Agreement and the information provided to the Buyer and the Buyer's Advisors in the virtual data rooms established in connection with the transactions contemplated by the Agreement, as well as written responses to requests submitted by the Buyer or the Buyer's Advisors in the virtual data rooms, in each case as included in Schedule 13.1(A).
Drag-Along Notice			as stated in clause 7.3.2.
Drag-Along Process			as stated in clause 7.3.
Equity Bridge			the agreed equity bridge from the enterprise value to the Base Purchase Price as set out in Schedule 1.1(a).
Equity Ticker			as stated in clause 4.2.


Expert			as described in clause 5.4.
Foreign Direct Investment Authority			the Danish Business Authority.
Group Company			a company in the Group.
Group or Group Companies			the Company and the Subsidiaries.
Key Employees			each of (i) [*], (ii) [], (iii) [], (iv) [], (v) [], (vi) [], (vii) [], (viii) [], (ix) [], (x) [] and (xi) [**]. The Persons included above in (ii), (iii), (iv), (v), (vi), (vii), (x) and (xi) are all considered salaried employees (in Danish: “lønmodtager”).
Law			any supranational, federal, state, local or foreign law, statute or ordinance, rule, regulation, directive, code, order, judgment, agency requirement, license, permit, injunction or decree enacted, issued, promulgated, enforced or entered by any governmental authority.
Leakage			in respect of, by or to the benefit of the Sellers, a Seller Affiliate or any Seller's Related Party (other than a Group Company), except for any Permitted Leakage: (i)any dividend, distribution, salary, fees, charges or other compensation, including director's, management, advisory or professional fee and expenses, or other kind of payment (whether in cash or in kind, including any liabilities assumed, indemnified, increased or incurred, or benefit(s) or gifts having monetary or financial value) undertaken, declared, paid, made or agreed to be made by a Group Company, whether against delivery of any assets or services or not; (ii)any loans, or any payment of interest or principal in respect of any amounts owed, and any costs associated with the re-financing of any such loan;


Leakage			(iii)any return on equity or any other payment in respect of share capital, loan capital or other securities by any Group Company, or any amount payable on the repurchase, redemption, repayment, reduction or cancellation of any shares, loans or other securities by a Group Company; (iv)the waiver, deferral or release by a Group Company of any amount or liability owed to a Group Company; (v)any payments made, guarantees, encumbrances, liens or other securities issued, or liabilities incurred or assumed by a Group Company; (vi)any costs or other fees payable by the Group in connection with or as a consequence of the transactions contemplated by this Agreement, (including (a) Transaction Bonuses and other bonuses, (b) advisor fees, (c) success fees, or (d) prepayment or early termination fees, break costs, liquidated damages and/or indemnification costs and/or expenses for termination and other related fees or fees of a similar nature in respect of the Secured Debt and [*] and including, for the avoidance of doubt, (x) any such costs or other fees which are not in respect of, by or to the benefit of the Sellers, a Seller Affiliate or any Seller's Related Party, (y) any accrued interest payments on such costs and fees and (z) where any such costs and fees falls due after the Closing Date; (vii)[*] (viii)any payment of any Taxes paid in connection with (i) to (vi) above; and


			(ix)any commitment to do any of the matters referred to in (i) to (vi) above; in each case paid, accrued, triggered, agreed to or arising between the Locked Box Date (not inclusive) and the Closing Date (inclusive) to the extent not otherwise set out above.
Locked Box Accounts			the Group's consolidated (i) profit and loss statement covering the period from the Accounts Date to the Locked Box Date and (ii) balance sheet as at the Locked Box Date, prepared in accordance with the Accounting Principles and reviewed by the Company's auditor, EY Godkendt Revisionspartnerselskab in accordance with ISRE 2410, as set out in Schedule 1.1(b).
Locked Box Date			31 March 2021.
Long Stop Date			the date that falls 6 months after the Signing Date with an automatic extension of up to 6 months, if (i) required for approval or clearance by the Competition Authorities or the Foreign Direct Investment Authority and (ii) accepted by the Sellers' Representative (acting reasonably, however, any non-acceptance shall not be deemed reasonable for any outstanding approval or clearance from the Conselho Administrativo de Defesa Econômica of Brazil).
Loss			any direct as well as any reasonably foreseeable indirect loss, damage, liability, and expense (including reasonable attorneys’ fees and expenses) calculated in accordance with the Laws of Denmark in connection with any Claim.
Minority Shareholders			the Persons set out in Schedule A.
Notice			as described in clause 23.1.
Ordinary Course of Business			the ordinary course of business of the Group as of the Signing Date conducted in consistency with past practices or, if no such past practices exist, in accordance with ordinary business practices for comparable businesses within the jurisdictions in which the Group conducts its business, however taking into consideration and accepting the challenges and changes caused or required by COVID-19 to the extent Disclosed prior to the Signing Date.


Parties			the Sellers and the Buyer.
Party			a Seller or the Buyer.
Pay Off Amounts			such amounts in such currencies as notified to the Buyer under clause 11.2(a) as being the amounts required: (i) to discharge the indebtedness (whether or not due and payable) owed under or in connection with the Secured Debt at the Closing Date (for the avoidance of doubt, including the outstanding principal amount of any drawing and any accrued but unpaid interest thereon at the Closing Date); (ii) to release all guarantees and security in relation to the Secured Debt at the Closing Date; and (iii) to terminate the Secured Debt at the Closing Date (such amount being inclusive of any applicable break costs, prepayment or early termination fees and other related fees or fees of a similar nature), assuming such discharge, release and termination takes effect from the Closing Date.
Permitted Leakage			(i)any salary, fee or similar (including any expenses) payable or paid to any of the directors of the board of any of the Group Companies who is a Seller, a Seller’s Affiliate or any Seller's Related Party pursuant to an agreement entered into in the Ordinary Course of Business and as Disclosed prior to the Signing Date (for the avoidance of doubt, this does not include any bonuses or similar as a result of Closing to the extent not included in the Equity Bridge); (ii)any salaries, bonuses or similar remuneration and/or compensation (including any expenses) payable or paid to any employees of the Group who is a Seller, a Seller’s


			Affiliate or any Seller's Related Party pursuant to their current employment, consultant or service agreement with any Group Company and/or pursuant to any revisions of such employment terms (whether individual or collective) made in the Ordinary Course of Business and as Disclosed prior to the Signing Date (for the avoidance of doubt, this does not include any bonuses or similar triggered by Closing to the extent not included in the Equity Bridge); (iii)any fee payable by the Company to the W&I Insurer or its advisors relating to obtaining and issuing the W&I Insurance Policy as Disclosed prior to the Signing Date; (iv)any payment or other transaction required or expressly permitted pursuant to the terms of the Agreement; (v)any Leakage taking place with the Buyer’s prior written consent; (vi)any items to the extent included in the Equity Bridge or the Locked Box Accounts; and (vii)any payment of any Tax paid as a consequence of any circumstance described in (i) to (iv) above.
Person			any individual, corporation, partnership, firm, joint venture, association, joint stock company, trust, incorporated or non-incorporated organisation, governmental or regulatory body or other entity.
Purchase Price			as stated in clause 4.2.
Related Party			a Person comprised by section 2 of the Danish Bankruptcy Act.
Schedule			a schedule to the Agreement.


Secured Debt			all of the Group's outstanding commitments as of the Closing Date under the Facilities Agreement, dated 11 January 2017, between the Company as parent and guarantor, Claudio Bidco as borrower and guarantor and Fertin Pharma A/S as borrower and guarantor and [***] as lenders.
Sellers			the Majority Sellers and the Minority Shareholders.
Sellers' Knowledge			the actual knowledge of each of Peter Halling, [*], Rikke Kjær Nielsen, [*] and Claus Bagger-Sørensen.
Sellers’ Fundamental Warranties			the warranties included in clauses 1 to 3 in Schedule 14.1.
Sellers' Representative			Claudio Topco, on its own behalf and as designated by Bagger-Sørensen and all of the Minority Shareholders by their signatures on the Drag Along Acknowledgement or this Agreement, respectively, as their representative in all matters related to the Agreement where reference is made to Sellers' Representative.
Sellers' Representatives' Bank Account			the bank account set out in Schedule B.
Sellers' Warranties			as described in Schedule 14.1.
Shares			nominally DKK 13,529,387 shares in the Company divided into nominally DKK 12,124,163 class A shares of DKK 1.00 each and nominally DKK 1,405,224 class B shares of DKK 1.00 each. The Shares together with the Treasury Shares represent 100% of the issued share capital of the Company.
Signing Date			the date on which the Parties sign the Agreement.
Signing No Claims Declaration			as set out in the W&I Insurance Policy.
Subsidiaries			any legal entity in which the Company is entitled to exercise a direct or indirect Controlling interest in the financial and operational decisions in accordance with the principles of Danish company Law in force from time to time, as set out in Schedule 1.1(c).


Taxes			any and all direct and indirect tax liabilities, both current and deferred, primary and secondary, including income tax, corporation tax, capital gains tax, VAT of all kind, special payroll tax, sales tax, withholding tax, including but not limited to dividend tax, interest tax and royalty tax, registration fees, stamp duties, customs duties, excise duties of all kind, wage tax, payroll duties, social security contributions and costs, property taxes and similar levies, duties, charges, stamps, taxes, and including interest, additional tax and tax penalties, fees, costs, fines or surcharges, and payments under the Danish joint taxation regime including utilization of tax losses carried forward, reduction of tax assets, including utilization of own tax losses and reduction of any basis of depreciation.
Third Party Claim			as stated in clause 18.4.
Third Party Rights			any interest in equity of any Person (including right of first refusal or purchase option); any type of legal charge, mortgage, pledge, lien, security interest (including any created by Law), retention of title or other security agreement or arrangement, in each case in favour of a third party.
Transaction Bonuses			the transaction bonuses payable by Fertin Pharma A/S as further set out in Schedule C.
Treasury Shares			nominally DKK 14,774 shares in the Company held by the Company itself divided into nominally DKK 7,931 class A shares of DKK 1.00 each and nominally DKK 6,843 class B shares of DKK 1.00 each.
Warranties			the representations and warranties given by the Sellers pursuant to clause 14.
W&I Insurance			the warranty and indemnity insurance with the Buyer as the insured and the W&I Insurer as the insurer as regards the liability for Breach of Sellers'


			Warranties on the terms set out in the W&I Insurance Policy.
W&I Insurance Policy			the insurance policy governing the W&I Insurance in the form contained in Schedule 1.1(d).
W&I Insurer			such insurer that the Buyer contracts with for purposes of the W&I Insurance and pursuant to the W&I Insurance Policy.


For and on behalf of the Buyer: /s/ Bruno Chamielec ____________________________ Bruno Chamielec			/s/ Denis Tikhonov ____________________________ Denis Tikhonov


For and on behalf of the Sellers' Representative as a Seller and as the Sellers’ Representative: /s/ M.L. van Dam ____________________________ By: M.L. van Dam Title: Director			/s/ L.A. L Larsson ____________________________ By: L.A.L Larsson Title: Director
For and on behalf of Bagger-Sørensen: /s/ Steen Bagger-Sørensen ____________________________ Steen Bagger-Sørensen			/s/ Claus Bagger-Sørensen ____________________________ Claus Bagger-Sørensen


For and on behalf of Bagger-Sørensen: /s/ Steen Bagger-Sørensen ____________________________ Steen Bagger-Sørensen			/s/ Claus Bagger-Sørensen ____________________________ Claus Bagger-Sørensen
Personally: /s/ Claus Bagger-Sørensen ____________________________ Claus Bagger-Sørensen			Personally: /s/ Steen Bagger-Sørensen ____________________________ Steen Bagger-Sørensen


Appendix			any appendix to this Schedule 14.1.
Anti-Corruption Laws			corruption or anti-bribery Laws, rules or regulation of any jurisdiction, including, without limitation, the Danish Penal Code Consolidated Act no. 1156 of 20 September 2018 (as amended), the U.S Foreign Corrupt Practices Act of 1977 (as amended), the Canadian Corruption of Foreign Public Officials Act (as amended), the United Kingdom Bribery Act of 2010 (as amended), the Indian Prevention of Corruption Act, 1988 (as amended) and any legislation implementing or issued pursuant to the above, including any Laws, statutes, regulations and rules issued by any governmental authority of similar purpose and scope.
Anti-Money Laundering Laws			Anti-Money Laundering Laws as set out in section 18.8.
Governmental Entity			any supranational, foreign, domestic, regional, territori-al, municipal, county, district, local or other governmen-tal, administrative or regulatory authority or agency, including any court, ministry, department or any subdi-vision thereof or any other supranational, governmental or regulatory authority, body, department or organisation, including the European Union.
Governmental Official			any governmental official including any officer or employee of a foreign government or government-controlled entity or of a public international organization, or any person acting in an official capacity for or on behalf of any of the foregoing, or any political party or official thereof, or candidate for political office.
IPR			any and all patents, patent applications, unfiled patent inventions or invention disclosures (whether or not patentable), utility models, trademarks, service marks, trade dress, and rights in logos and get up, trade names, business or domain names (including any and all goodwill associated with or attached to any of the foregoing), copyrights (including rights in computer software) and moral rights, registered designs, design patents, rights in designs and software, database rights, semi conductor


			topography rights, and trade secrets, Know-How and all rights or forms of protection having an equivalent or similar nature or effect anywhere in the world, in each case whether enforceable, registered or unregistered and including applications for the grant or registration, all renewals, divisionals, continuations, continuations-in-part, re-issues, extensions or any of the foregoing.
Know-How			paper, manufacturing techniques or processes, equipment settings or configurations, material handling or processing techniques or understanding, clinical testing data, consumer testing data, electronically stored data, magnetic media, film and microfilm or any other tangible form containing drawings, formulae, test results, reports, project reports and testing procedures, shop practices, instruction and training manuals, tables of operating conditions, market forecasts, specifications, quotations, tables, lists and particulars of customers and suppliers, marketing methods and procedures, technical literature and brochures or any other technical, industrial and commercial information and techniques (in tangible form), including any of the foregoing that (i) falls under applicable statutory definitions of a “trade secret” or (ii) from which the proprietor derives commercial benefit or value because the information is secret or (iii) that the proprietor treats with reasonable secrecy provisions as if it were a trade secret.
Leased Real Property			as set out in section 8.4.
Management Reports			the unaudited monthly management reports of the Group Companies for the period from April 2021 to May 2021.
Material Contract			as set out in section 7.1.
Owned Real Property			as set out in section 8.1.
Sanctions and Trade Control Rules			as set out in section 18.1.
Software			any and all software and related intellectual property rights, including but not limited to source code, object code, copyright, know-how, database rights and other codes, however, excluding IPR.