☑
|
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
☐
|
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
Delaware
|
47-1758322
|
|
(State of Incorporation)
|
(I.R.S. Employer Identification No.)
|
108 Wilmot Road, Deerfield, Illinois
|
60015
|
|
(Address of principal executive offices)
|
(Zip Code)
|
Large accelerated filer ☑
|
Accelerated filer ☐
|
Non-accelerated filer ☐ (Do not check if a smaller reporting company)
|
Smaller reporting company ☐
|
PART I. FINANCIAL INFORMATION | ||||
Item 1.
|
Consolidated Condensed Financial Statements (Unaudited)
|
|||
a)
|
3 | |||
b)
|
4 | |||
c)
|
5 | |||
d)
|
6 | |||
e)
|
7 | |||
f)
|
8 | |||
Item 2.
|
52 | |||
Item 3.
|
70 | |||
Item 4.
|
71 | |||
PART II. OTHER INFORMATION | ||||
Item 1.
|
71 | |||
Item 1A.
|
71 | |||
Item 2.
|
87 | |||
Item 6.
|
87 |
February 28,
|
August 31,
|
|||||||
2015
|
2014
|
|||||||
Assets
|
||||||||
Current Assets:
|
||||||||
Cash and cash equivalents
|
$
|
3,005
|
$
|
2,646
|
||||
Accounts receivable, net
|
7,017
|
3,218
|
||||||
Inventories
|
9,379
|
6,076
|
||||||
Other current assets
|
1,314
|
302
|
||||||
Total Current Assets
|
20,715
|
12,242
|
||||||
Non-Current Assets:
|
||||||||
Property, plant and equipment, at cost, less accumulated depreciation and amortization
|
15,646
|
12,257
|
||||||
Equity investment in Alliance Boots
|
-
|
7,336
|
||||||
Goodwill
|
17,044
|
2,359
|
||||||
Intangible assets
|
12,225
|
1,180
|
||||||
Other non-current assets
|
5,727
|
1,896
|
||||||
Total Non-Current Assets
|
50,642
|
25,028
|
||||||
Total Assets
|
$
|
71,357
|
$
|
37,270
|
||||
Liabilities and Equity
|
||||||||
Current Liabilities:
|
||||||||
Short-term borrowings
|
$
|
1,061
|
$
|
774
|
||||
Trade accounts payable
|
10,293
|
4,315
|
||||||
Accrued expenses and other liabilities
|
5,140
|
3,701
|
||||||
Income taxes
|
196
|
105
|
||||||
Total Current Liabilities
|
16,690
|
8,895
|
||||||
Non-Current Liabilities:
|
||||||||
Long-term debt
|
16,001
|
3,736
|
||||||
Deferred income taxes
|
3,689
|
1,080
|
||||||
Other non-current liabilities
|
3,951
|
2,942
|
||||||
Total Non-Current Liabilities
|
23,641
|
7,758
|
||||||
Commitments and Contingencies (see Note 12)
|
||||||||
Equity:
|
||||||||
Preferred stock $.01 par value ($.0625 at August 31, 2014); authorized 32 million shares, none issued
|
-
|
-
|
||||||
Common stock $.01 par value ($.078125 at August 31, 2014); authorized 3.2 billion shares; issued 1,172,513,618 at February 28, 2015 and 1,028,180,150 at August 31, 2014
|
12
|
80
|
||||||
Paid-in capital
|
9,838
|
1,172
|
||||||
Employee stock loan receivable
|
(3
|
)
|
(5
|
)
|
||||
Retained earnings
|
24,526
|
22,327
|
||||||
Accumulated other comprehensive (loss) income
|
(68
|
)
|
136
|
|||||
Treasury stock, at cost; 79,751,513 shares at February 28, 2015 and 77,793,261 at August 31, 2014
|
(3,491
|
)
|
(3,197
|
)
|
||||
Total Walgreens Boots Alliance, Inc. Shareholders' Equity
|
30,814
|
20,513
|
||||||
Noncontrolling interests
|
212
|
104
|
||||||
Total Equity
|
31,026
|
20,617
|
||||||
Total Liabilities and Equity
|
$
|
71,357
|
$
|
37,270
|
Equity attributable to Walgreens Boots Alliance, Inc.
|
||||||||||||||||||||||||||||||||||||
Common Stock
Shares
|
Common
Stock
Amount
|
Treasury
Stock
Amount
|
Paid-In
Capital
|
Employee
Stock
Loan
Receivable
|
Accumulated
Other
Comprehensive Income
|
Retained
Earnings
|
Noncontrolling Interests
|
Total
Equity
|
||||||||||||||||||||||||||||
August 31, 2014
|
950,386,889
|
$
|
80
|
$
|
(3,197
|
)
|
$
|
1,172
|
$
|
(5
|
)
|
$
|
136
|
$
|
22,327
|
$
|
104
|
$
|
20,617
|
|||||||||||||||||
Net earnings
|
-
|
-
|
-
|
-
|
-
|
-
|
2,892
|
45
|
2,937
|
|||||||||||||||||||||||||||
Other comprehensive income, net of tax
|
-
|
-
|
-
|
-
|
-
|
(204
|
)
|
-
|
(5
|
)
|
(209
|
)
|
||||||||||||||||||||||||
Dividends declared ($.675 per share)
|
-
|
-
|
-
|
-
|
-
|
-
|
(693
|
)
|
-
|
(693
|
)
|
|||||||||||||||||||||||||
Exchange of Walgreen Co. shares for Walgreens Boots Alliance, Inc. shares
|
-
|
(69
|
)
|
-
|
69
|
-
|
-
|
-
|
-
|
-
|
||||||||||||||||||||||||||
Issuance of shares for Alliance Boots acquisition
|
144,333,468
|
1
|
-
|
10,976
|
-
|
-
|
-
|
-
|
10,977
|
|||||||||||||||||||||||||||
Treasury stock purchases
|
(9,216,429
|
)
|
-
|
(594
|
)
|
-
|
-
|
-
|
-
|
-
|
(594
|
)
|
||||||||||||||||||||||||
Employee stock purchase and option plans
|
7,258,177
|
-
|
300
|
(5
|
)
|
-
|
-
|
-
|
-
|
295
|
||||||||||||||||||||||||||
Stock-based compensation
|
-
|
-
|
-
|
65
|
-
|
-
|
-
|
-
|
65
|
|||||||||||||||||||||||||||
Acquisition of noncontrolling interest
|
-
|
-
|
-
|
(2,439
|
)
|
-
|
-
|
-
|
(130
|
)
|
(2,569
|
)
|
||||||||||||||||||||||||
Employee stock loan receivable
|
-
|
-
|
-
|
-
|
2
|
-
|
-
|
-
|
2
|
|||||||||||||||||||||||||||
Noncontrolling interests in businesses acquired
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
198
|
198
|
|||||||||||||||||||||||||||
February 28, 2015
|
1,092,762,105
|
$
|
12
|
$
|
(3,491
|
)
|
$
|
9,838
|
$
|
(3
|
)
|
$
|
(68
|
)
|
$
|
24,526
|
$
|
212
|
$
|
31,026
|
Three Months Ended February 28,
|
Six Months Ended February 28,
|
|||||||||||||||
2015
|
2014
|
2015
|
2014
|
|||||||||||||
Net sales
|
$
|
26,573
|
$
|
19,605
|
$
|
46,127
|
$
|
37,934
|
||||||||
Cost of sales
|
19,691
|
13,955
|
33,949
|
27,132
|
||||||||||||
Gross Profit
|
6,882
|
5,650
|
12,178
|
10,802
|
||||||||||||
Selling, general and administrative expenses
|
5,606
|
4,569
|
10,062
|
8,948
|
||||||||||||
Equity earnings in Alliance Boots
|
101
|
136
|
315
|
330
|
||||||||||||
Operating Income
|
1,377
|
1,217
|
2,431
|
2,184
|
||||||||||||
Gain on previously held equity interest
|
706
|
-
|
706
|
-
|
||||||||||||
Other income (expense)
|
504
|
(59
|
)
|
703
|
166
|
|||||||||||
Earnings Before Interest and Tax Provision
|
2,587
|
1,158
|
3,840
|
2,350
|
||||||||||||
Interest expense, net
|
144
|
37
|
199
|
78
|
||||||||||||
Earnings Before Income Tax Provision
|
2,443
|
1,121
|
3,641
|
2,272
|
||||||||||||
Income tax provision
|
391
|
391
|
712
|
810
|
||||||||||||
Post tax earnings from equity method investments
|
8
|
-
|
8
|
-
|
||||||||||||
Net Earnings
|
2,060
|
730
|
2,937
|
1,462
|
||||||||||||
Net earnings attributable to noncontrolling interests
|
18
|
14
|
45
|
23
|
||||||||||||
Net Earnings Attributable to Walgreens Boots Alliance, Inc. Co.
|
$
|
2,042
|
$
|
716
|
$
|
2,892
|
$
|
1,439
|
||||||||
Net earnings per common share attributable to Walgreens Boots Alliance, Inc. – basic
|
$
|
1.96
|
$
|
0.75
|
$
|
2.91
|
$
|
1.51
|
||||||||
Net earnings per common share attributable to Walgreens Boots Alliance, Inc. – diluted
|
$
|
1.93
|
$
|
0.74
|
$
|
2.88
|
$
|
1.49
|
||||||||
Dividends declared per share
|
$
|
0.3375
|
$
|
0.3150
|
$
|
0.6750
|
$
|
0.6300
|
||||||||
Average shares outstanding
|
1,043.6
|
951.9
|
994.7
|
950.6
|
||||||||||||
Dilutive effect of stock options
|
11.1
|
11.8
|
10.6
|
12.0
|
||||||||||||
Average diluted shares
|
1,054.7
|
963.7
|
1,005.3
|
962.6
|
Three Months Ended February 28,
|
Six Months Ended February 28,
|
|||||||||||||||
2015
|
2014
|
2015
|
2014
|
|||||||||||||
Comprehensive Income
|
||||||||||||||||
Net Earnings
|
$
|
2,060
|
$
|
730
|
$
|
2,937
|
$
|
1,462
|
||||||||
Other comprehensive income (loss), net of tax:
|
||||||||||||||||
Postretirement liability
|
(8
|
)
|
(2
|
)
|
(9
|
)
|
6
|
|||||||||
Unrealized (loss) on cash flow hedges
|
-
|
-
|
(12
|
)
|
-
|
|||||||||||
Changes in unrecognized gain (loss) on available-for-sale investments
|
90
|
(49
|
)
|
189
|
35
|
|||||||||||
Share of other comprehensive income (loss) of Alliance Boots
|
92
|
(19
|
)
|
113
|
(56
|
)
|
||||||||||
Currency translation adjustments
|
(301
|
)
|
116
|
(490
|
)
|
281
|
||||||||||
Total Other Comprehensive Income (Loss)
|
(127
|
)
|
46
|
(209
|
)
|
266
|
||||||||||
Total Comprehensive Income
|
1,933
|
776
|
2,728
|
1,728
|
||||||||||||
Comprehensive income attributable to noncontrolling interests
|
13
|
14
|
40
|
23
|
||||||||||||
Comprehensive income attributable to Walgreens Boots Alliance, Inc.
|
$
|
1,920
|
$
|
762
|
$
|
2,688
|
$
|
1,705
|
Six Months Ended
February 28,
|
||||||||
2015
|
2014
|
|||||||
Cash Flows from Operating Activities
:
|
||||||||
Net earnings
|
$
|
2,937
|
$
|
1,462
|
||||
Adjustments to reconcile net earnings to net cash provided by operating activities -
|
||||||||
Depreciation and amortization
|
826
|
663
|
||||||
Change in fair value of warrants and related amortization
|
(859
|
)
|
(166
|
)
|
||||
Gain on previously held equity interest
|
(706
|
)
|
-
|
|||||
Deferred income taxes
|
181
|
29
|
||||||
Stock compensation expense
|
65
|
52
|
||||||
Unrealized gain from fair value adjustments
|
(68
|
)
|
-
|
|||||
Equity earnings in Alliance Boots
|
(315
|
)
|
(330
|
)
|
||||
Other
|
390
|
48
|
||||||
Changes in operating assets and liabilities -
|
||||||||
Accounts receivable, net
|
(391
|
)
|
(117
|
)
|
||||
Inventories
|
106
|
(288
|
)
|
|||||
Other current assets
|
21
|
13
|
||||||
Trade accounts payable
|
363
|
(171
|
)
|
|||||
Accrued expenses and other liabilities
|
(20
|
)
|
(25
|
)
|
||||
Income taxes
|
(99
|
)
|
47
|
|||||
Other non-current assets and liabilities
|
(94
|
)
|
20
|
|||||
Net cash provided by operating activities
|
2,337
|
1,237
|
||||||
Cash Flows from Investing Activities
:
|
||||||||
Additions to property, plant and equipment
|
(643
|
)
|
(591
|
)
|
||||
Proceeds from sale of assets
|
579
|
209
|
||||||
Return of restricted cash
|
74
|
-
|
||||||
Alliance Boots acquisition, net of cash received
|
(4,461
|
)
|
-
|
|||||
Other business and intangible asset acquisitions, net of cash received
|
(92
|
)
|
(297
|
)
|
||||
Purchases of short-term investments held to maturity
|
(29
|
)
|
(34
|
)
|
||||
Proceeds from short-term investments held to maturity
|
29
|
34
|
||||||
Investment in AmerisourceBergen
|
-
|
(430
|
)
|
|||||
Other
|
(165
|
)
|
(59
|
)
|
||||
Net cash used for investing activities
|
(4,708
|
)
|
(1,168
|
)
|
||||
Cash Flows from Financing Activities
:
|
||||||||
Payments of short-term borrowings
|
(330
|
)
|
-
|
|||||
Proceeds from issuance of long-term debt
|
12,279
|
-
|
||||||
Payments of long-term debt
|
(7,817
|
)
|
-
|
|||||
Stock purchases
|
(594
|
)
|
(205
|
)
|
||||
Proceeds related to employee stock plans
|
293
|
416
|
||||||
Cash dividends paid
|
(642
|
)
|
(597
|
)
|
||||
Other
|
(360
|
)
|
(12
|
)
|
||||
Net cash provided by (used for) financing activities
|
2,829
|
(398
|
)
|
|||||
Effect of exchange rate changes on cash and cash equivalents
|
(99
|
)
|
-
|
|||||
Changes in Cash and Cash Equivalents
:
|
||||||||
Net increase (decrease) in cash and cash equivalents
|
359
|
(329
|
)
|
|||||
Cash and cash equivalents at beginning of period
|
2,646
|
2,106
|
||||||
Cash and cash equivalents at end of period
|
$
|
3,005
|
$
|
1,777
|
· | Changes in the fair value of a derivative designated as a fair value hedge, along with the gain or loss on the hedged asset or liability attributable to the hedged risk, are recorded in the Consolidated Condensed Statements of Earnings. |
· | The effective portion of changes in the fair value of a derivative designated as a cash flow hedge is recorded in accumulated other comprehensive income (loss) in the Consolidated Condensed Statements of Comprehensive Income and reclassified into earnings in the period or periods during which the hedged item affects earnings. |
· | The effective portion of changes in the fair value of a derivative designated as a hedge of a net investment in a foreign operation is recorded in cumulative translation adjustments within accumulated other comprehensive income (loss) in the Consolidated Condensed Statements of Comprehensive Income. Recognition in earnings of amounts previously recorded in cumulative translation adjustments is limited to circumstances such as complete or substantially complete liquidation of the net investment in the hedged investments in foreign operations. |
· | Changes in the fair value of a derivative not designated in a hedging relationship are recognized in the Consolidated Condensed Statements of Earnings along with the ineffective portions of changes in the fair value of derivatives designated in hedging relationships. |
Three Months Ended February 28, 2014
|
Six Months Ended February 28, 2014
|
|||||||||||||||||||||||
As
Reported
|
Adjustments
|
After
Change in
Accounting
Principle
|
As Reported
|
Adjustments
|
After
Change in
Accounting
Principle
|
|||||||||||||||||||
Consolidated Condensed Statements of Earnings
|
||||||||||||||||||||||||
Equity earnings in Alliance Boots
|
$
|
194
|
$
|
(58
|
)
|
$
|
136
|
$
|
345
|
$
|
(15
|
)
|
$
|
330
|
||||||||||
Operating Income
|
1,275
|
(58
|
)
|
1,217
|
2,199
|
(15
|
)
|
2,184
|
||||||||||||||||
Earnings Before Income Tax Provision
|
1,179
|
(58
|
)
|
1,121
|
2,287
|
(15
|
)
|
2,272
|
||||||||||||||||
Income tax provision
|
411
|
(20
|
)
|
391
|
815
|
(5
|
)
|
810
|
||||||||||||||||
Net Earnings
|
768
|
(38
|
)
|
730
|
1,472
|
(10
|
)
|
1,462
|
||||||||||||||||
Net Earnings Attributable to Walgreens Boots Alliance, Inc.
|
754
|
(38
|
)
|
716
|
1,449
|
(10
|
)
|
1,439
|
||||||||||||||||
Net earnings per common share attributable to Walgreens Boots Alliance, Inc. – basic
|
0.79
|
(0.04
|
)
|
0.75
|
1.52
|
(0.01
|
)
|
1.51
|
||||||||||||||||
Net earnings per common share attributable to Walgreens Boots Alliance, Inc. – diluted
|
0.78
|
(0.04
|
)
|
0.74
|
1.51
|
(0.02
|
)
|
1.49
|
||||||||||||||||
Consolidated Condensed Statements of Comprehensive Income
|
||||||||||||||||||||||||
Net Earnings
|
768
|
(38
|
)
|
730
|
1,472
|
(10
|
)
|
1,462
|
||||||||||||||||
Share of other comprehensive loss of Alliance Boots
|
(36
|
)
|
17
|
(19
|
)
|
(70
|
)
|
14
|
(56
|
)
|
||||||||||||||
Cumulative translation adjustments
|
191
|
(75
|
)
|
116
|
253
|
28
|
281
|
|||||||||||||||||
Total Other Comprehensive Income
|
104
|
(58
|
)
|
46
|
224
|
42
|
266
|
|||||||||||||||||
Total Comprehensive Income
|
872
|
(96
|
)
|
776
|
1,696
|
32
|
1,728
|
|||||||||||||||||
Comprehensive Income Attributable to Walgreens Boots Alliance, Inc.
|
$
|
858
|
$
|
(96
|
)
|
$
|
762
|
$
|
1,673
|
$
|
32
|
$
|
1,705
|
As of August 31, 2014
|
||||||||||||
As Reported
|
Adjustments
|
After
Change in
Accounting
Principle
|
||||||||||
Consolidated Condensed Balance Sheet
|
||||||||||||
Non-Current Assets:
|
||||||||||||
Equity investment in Alliance Boots
|
$
|
7,248
|
$
|
88
|
$
|
7,336
|
||||||
Total Non-Current Assets
|
24,940
|
88
|
25,028
|
|||||||||
Total Assets
|
37,182
|
88
|
37,270
|
|||||||||
Non-Current Liabilities:
|
||||||||||||
Deferred income taxes
|
1,048
|
32
|
1,080
|
|||||||||
Total Non-Current Liabilities
|
7,726
|
32
|
7,758
|
|||||||||
Equity:
|
||||||||||||
Retained earnings
|
22,229
|
98
|
22,327
|
|||||||||
Accumulated other comprehensive income
|
178
|
(42
|
)
|
136
|
||||||||
Total Walgreens Boots Alliance, Inc. Shareholders' Equity
|
20,457
|
56
|
20,513
|
|||||||||
Total Equity
|
20,561
|
56
|
20,617
|
|||||||||
Total Liabilities and Equity
|
$
|
37,182
|
$
|
88
|
$
|
37,270
|
Six Months Ended February 28, 2014
|
||||||||||||
As Reported
|
Adjustments
|
After
Change in
Accounting
Principle
|
||||||||||
Consolidated Condensed Statement of Cash Flows
|
||||||||||||
Cash Flows from Operating Activities:
|
||||||||||||
Net earnings
|
$
|
1,472
|
$
|
(10
|
)
|
$
|
1,462
|
|||||
Deferred income taxes
|
34
|
(5
|
)
|
29
|
||||||||
Equity earnings in Alliance Boots
|
(345
|
)
|
15
|
(330
|
)
|
Financing
Obligation
|
Capital
Lease
|
Operating
Lease
|
||||||||||
2015
|
$
|
19
|
$
|
68
|
$
|
3,071
|
||||||
2016
|
18
|
66
|
3,006 | |||||||||
2017
|
18
|
62
|
2,886
|
|||||||||
2018
|
18
|
59
|
2,814 | |||||||||
2019
|
18
|
59
|
2,561
|
|||||||||
Later
|
1,153
|
901
|
23,102
|
|||||||||
Total Minimum Lease Payments
|
$
|
1,244
|
$
|
1,215
|
$
|
37,440
|
February 28,
2015
|
August 31,
2014
|
|||||||
Balance – beginning of period
|
$
|
257
|
$
|
123
|
||||
Provision for present value of non-cancellable lease payments on closed facilities
|
11
|
171
|
||||||
Assumptions about future sublease income, terminations and changes in interest rates
|
2
|
(8
|
)
|
|||||
Interest accretion
|
13
|
14
|
||||||
Liability assumed through acquisition of Alliance Boots
|
13
|
-
|
||||||
Cash payments, net of sublease income
|
(36
|
)
|
(43
|
)
|
||||
Balance – end of period
|
$
|
260
|
$
|
257
|
Three Months Ended
February 28,
|
Six Months Ended
February 28,
|
|||||||||||||||
2015
|
2014
|
2015
|
2014
|
|||||||||||||
Minimum rentals
|
$
|
809
|
$
|
673
|
$
|
1,486
|
$
|
1,333
|
||||||||
Contingent rentals
|
1
|
1
|
3
|
4
|
||||||||||||
Less: Sublease rental income
|
(6
|
)
|
(7
|
)
|
(11
|
)
|
(12
|
)
|
||||||||
$
|
804
|
$
|
667
|
$
|
1,478
|
$
|
1,325
|
February 28, 2015
|
August 31, 2014
|
|||||||||||||||
Carrying
Value
|
Ownership
Percentage
|
Carrying
Value
|
Ownership
Percentage
|
|||||||||||||
Alliance Boots
|
$
|
N/A
|
100
|
%
|
$
|
7,336
|
45
|
%
|
||||||||
Other
|
762
|
12% - 50
|
%
|
74
|
30% - 50
|
%
|
||||||||||
Total
|
$
|
762
|
$
|
7,410
|
February 28, 2015
(1)
|
August 31, 2014
(1)
|
|||||||
Current assets
|
$
|
4,674
|
$
|
9,074
|
||||
Noncurrent assets
|
625
|
22,363
|
||||||
Current liabilities
|
4,067
|
9,372
|
||||||
Noncurrent liabilities
|
253
|
10,608
|
||||||
Shareholders' equity
(2)
|
979
|
11,457
|
Three Months Ended
February 28,
|
Six Months Ended
February 28,
|
|||||||||||||||
2015
(3)
|
2014
(3)
|
2015
(3)
|
2014
(3)
|
|||||||||||||
Net sales
|
$
|
5,317
|
$
|
9,688
|
$
|
14,978
|
$
|
19,100
|
||||||||
Gross Profit
|
979
|
2,083
|
3,168
|
4,055
|
||||||||||||
Net Income
|
246
|
324
|
743
|
771
|
||||||||||||
Share of income from equity method investments
(3)
|
109
|
136
|
323
|
330
|
February 28, 2015 | ||||||||||||||||||||
Cost
|
Unrealized gains
|
Foreign Exchange losses
|
Unrealized losses
|
Fair value
|
||||||||||||||||
AmerisourceBergen common stock
|
$
|
717
|
$
|
461
|
$
|
-
|
$
|
-
|
$
|
1,178
|
||||||||||
Other investments
|
75
|
6
|
(4
|
)
|
-
|
77
|
||||||||||||||
Total available-for-sale investments
|
$
|
792
|
$
|
467
|
$
|
(4
|
)
|
$
|
-
|
$
|
1,255
|
August 31, 2014 | ||||||||||||||||||||
Cost
|
Unrealized gains
|
Foreign Exchange losses
|
Unrealized losses
|
Fair value
|
||||||||||||||||
AmerisourceBergen common stock
|
$
|
717
|
$
|
170
|
$
|
-
|
$
|
-
|
$
|
887
|
||||||||||
Total available-for-sale investments
|
$
|
717
|
$
|
170
|
$
|
-
|
$
|
-
|
$
|
887
|
Amount
|
||||
Consideration attributable to WBAD
|
$
|
2,569
|
||
Less: Carrying value of the Company's pre-existing noncontrolling interest
|
130
|
|||
Impact to additional paid in capital
|
$
|
2,439
|
Consideration paid
|
||||
Cash
|
$
|
4,874
|
||
Common stock
|
10,977
|
|||
Total consideration transferred
|
15,851
|
|||
Less: consideration attributed to WBAD
|
(2,569
|
)
|
||
13,282
|
||||
Fair value of the investment in Alliance Boots held before the Second Step Transaction
|
8,290
|
|||
Total consideration
|
$
|
21,572
|
||
Identifiable assets acquired and liabilities assumed including noncontrolling interests
|
||||
Cash and cash equivalents
|
$
|
413
|
||
Accounts receivable
|
3,805
|
|||
Inventories
|
3,713
|
|||
Other current assets
|
902
|
|||
Property, plant and equipment
|
3,774
|
|||
Intangible assets
|
11,461
|
|||
Other non-current assets
|
1,760
|
|||
Trade accounts payable, accrued expenses and other liabilities
|
(7,722
|
)
|
||
Borrowings
|
(8,999
|
)
|
||
Deferred income taxes
|
(2,437
|
)
|
||
Other non-current liabilities
|
(456
|
)
|
||
Noncontrolling interests
|
(198
|
)
|
||
Total identifiable net assets and noncontrolling interests
|
6,016
|
|||
Goodwill
|
$
|
15,556
|
Definite-Lived Intangible Assets
|
Weighted-Average
Useful Life
(in years)
|
Amount
(in millions)
|
||||||
Customer relationships
|
12
|
$
|
1,676
|
|||||
Loyalty card holders
|
12
|
723
|
||||||
Trade names and trademarks
|
15
|
544
|
||||||
Favorable lease interests
|
3
|
55
|
||||||
Total
|
$
|
2,998
|
Indefinite-Lived Intangible Assets
|
Amount
(in millions)
|
|||
Trade names and trademarks
|
$
|
6,192
|
||
Pharmacy licenses
|
2,271
|
|||
Total
|
$
|
8,463
|
Pro forma
Three months ended
|
Pro forma
Six months ended
|
|||||||||||||||
2015
|
2014
|
2015
|
2014
|
|||||||||||||
(in millions, except per share amounts)
|
||||||||||||||||
Net sales
|
$
|
30,202
|
$
|
29,276
|
$
|
59,173
|
$
|
56,999
|
||||||||
Net earnings
|
1,253
|
966
|
2,621
|
1,973
|
||||||||||||
Net earnings per common share:
|
||||||||||||||||
Basic
|
$
|
1.20
|
$
|
0.88
|
$
|
2.51
|
$
|
1.80
|
||||||||
Diluted
|
1.19
|
0.87
|
2.49
|
1.78
|
Three months ended
February 28,
|
Six months ended
February 28,
|
|||||||
2015
|
2015
|
|||||||
(in millions, except per share amounts)
|
||||||||
Net sales
|
$
|
5,525
|
$
|
5,525
|
||||
Net earnings
|
330
|
330
|
||||||
Net earnings per common share:
|
||||||||
Basic
|
$
|
0.32
|
$
|
0.33
|
||||
Diluted
|
0.31
|
0.33
|
Retail Pharmacy
USA
|
Retail Pharmacy
International
|
Pharmaceutical
Wholesale
|
Total
|
|||||||||||||
August 31, 2014
|
$
|
2,359
|
$
|
-
|
$
|
-
|
$
|
2,359
|
||||||||
Acquisitions
|
8,311
|
3,747
|
3,521
|
15,579
|
||||||||||||
Sale of business
(1)
|
(706
|
)
|
-
|
-
|
(706
|
)
|
||||||||||
Other
(2)
|
(3
|
)
|
-
|
-
|
(3
|
)
|
||||||||||
Currency translation adjustments
|
-
|
(99
|
)
|
(86
|
)
|
(185
|
)
|
|||||||||
February 28, 2015
|
$
|
9,961
|
$
|
3,648
|
$
|
3,435
|
$
|
17,044
|
(1) | Represents Walgreens Infusion and Respiratory Services goodwill that has been reclassified as an asset held for sale. See Note 22, Subsequent Events for further details. |
(2) | Other primarily represents immaterial purchase accounting adjustments for the Company's acquisitions. |
February 28, 2015
|
August 31, 2014
|
|||||||
Gross Amortizable Intangible Assets
|
||||||||
Purchased prescription files
|
$
|
925
|
$
|
1,079
|
||||
Favorable lease interests
|
427
|
382
|
||||||
Purchasing and payer contracts
|
95
|
301
|
||||||
Non-compete agreements
|
154
|
151
|
||||||
Trade names and trademarks
|
735
|
191
|
||||||
Customer relationships
|
1,724
|
-
|
||||||
Loyalty card holders
|
716
|
- | ||||||
Other amortizable intangible assets
|
4
|
4
|
||||||
Total gross amortizable intangible assets
|
4,780
|
2,108
|
||||||
Accumulated amortization
|
||||||||
Purchased prescription files
|
471
|
474
|
||||||
Favorable lease interests
|
187
|
174
|
||||||
Purchasing and payer contracts
|
61
|
145
|
||||||
Non-compete agreements
|
82
|
70
|
||||||
Trade names and trademarks
|
84
|
69
|
||||||
Customer relationships
|
46
|
-
|
||||||
Loyalty card holders
|
10
|
- | ||||||
Other amortizable intangible assets
|
1
|
4
|
||||||
Total accumulated amortization
|
942
|
936
|
||||||
Total amortizable intangible assets, net
|
$
|
3,838
|
$
|
1,172
|
||||
Indefinite Lived Intangible Assets
|
||||||||
Trade names and trademarks
|
$
|
6,136
|
$
|
8
|
||||
Pharmacy licenses
|
2,251
|
-
|
||||||
Total indefinite lived intangible assets
|
$
|
8,387
|
$
|
8
|
||||
Total intangible assets, net
|
$
|
12,225
|
$
|
1,180
|
2015
|
2016
|
2017
|
2018
|
2019
|
||||||||||||||||
Estimated annual amortization expense:
|
$
|
426
|
$
|
465
|
$
|
424
|
$
|
388
|
$
|
366
|
February 28,
2015
|
August 31,
2014
|
|||||||
Short-Term Borrowings
(1)
|
||||||||
Current portion of loans assumed through the purchase of land and buildings; various interest rates from 5.000% to 8.750%; various maturities from 2015 to 2035
|
$
|
2
|
$
|
8
|
||||
1.000% unsecured notes due 2015
|
750
|
750
|
||||||
Other
(2)
|
309
|
16
|
||||||
Total short-term borrowings
|
$
|
1,061
|
$
|
774
|
||||
Long-Term Debt
(1)
|
||||||||
Unsecured variable rate notes due 2016
|
$
|
750
|
$
|
-
|
||||
Unsecured Pound Sterling variable rate term loan due 2019
|
2,235
|
-
|
||||||
1.800% unsecured notes due 2017
|
999
|
999
|
||||||
1.750% unsecured notes due 2017
|
749
|
-
|
||||||
5.250% unsecured notes due 2019
(3)
|
1,016
|
1,010
|
||||||
2.700% unsecured notes due 2019
|
1,248
|
-
|
||||||
2.875% unsecured Pound Sterling notes due 2020
(4)
|
615
|
-
|
||||||
3.300% unsecured notes due 2021
|
1,247
|
-
|
||||||
3.100% unsecured notes due 2022
|
1,199
|
1,199
|
||||||
3.800% unsecured notes due 2024
|
1,995
|
-
|
||||||
3.600% unsecured Pound Sterling notes due 2025
(4)
|
462
|
-
|
||||||
2.125% unsecured Euro notes due 2026
(5)
|
837
|
-
|
||||||
4.500% unsecured notes due 2034
|
497
|
-
|
||||||
4.400% unsecured notes due 2042
|
496
|
496
|
||||||
4.800% unsecured notes due 2044
|
1,500
|
-
|
||||||
Loans assumed through the purchase of land and buildings; various interest rates from 5.000% to 8.750%; various maturities from 2015 to 2035
|
41
|
40
|
||||||
Other
(6)
|
117
|
-
|
||||||
16,003
|
3,744
|
|||||||
Less: current maturities
|
2
|
8
|
||||||
Total long-term debt
|
$
|
16,001
|
$
|
3,736
|
(1) | All notes are presented net of unamortized discount, where applicable. |
(2) | Other short-term borrowings represent a mix of fixed and variable rate borrowings with various maturities and working capital facilities denominated in various foreign currencies including $29 million of U.S. dollar equivalent bank overdrafts. |
(3) | Also includes interest rate swap fair market value adjustments, see Note 11, Fair Value Measurements for additional fair value disclosures. |
(4) | Pound Sterling denominated notes are translated at the February 28, 2015 spot rate of $1.54 to one British Pound Sterling. |
(5) | Euro denominated notes are translated at the February 28, 2015 spot rate of $1.12 to one Euro. |
(6) | Other long-term debt represents a mix of fixed and variable rate borrowings in various foreign currencies with various maturities. |
Notes Issued
(in millions)
|
Maturity Date
|
Interest Rate
|
Interest Payment Dates
|
||
$
|
750
|
May 18, 2016
|
Variable; three-month U.S. dollar LIBOR, reset quarterly, plus 45 basis points
|
February 18, May 18, August 18, and November 18; commencing on February 18, 2015
|
|
750
|
November 17, 2017
|
Fixed 1.750%
|
May 17 and November 17; commencing on May 17, 2015
|
||
1,250
|
November 18, 2019
|
Fixed 2.700%
|
May 18 and November 18; commencing on May 18, 2015
|
||
1,250
|
November 18, 2021
|
Fixed 3.300%
|
May 18 and November 18; commencing on May 18, 2015
|
||
2,000
|
November 18, 2024
|
Fixed 3.800%
|
May 18 and November 18; commencing on May 18, 2015
|
||
500
|
November 18, 2034
|
Fixed 4.500%
|
May 18 and November 18; commencing on May 18, 2015
|
||
1,500
|
November 18, 2044
|
Fixed 4.800%
|
May 18 and November 18; commencing on May 18, 2015
|
||
$
|
8,000
|
Notes Issued (in millions)
|
Maturity Date
|
Interest Rate
|
|||
Euro Notes:
|
|||||
€
|
750
|
November 20, 2026
|
Fixed 2.125%
|
||
Pound Sterling Notes:
|
|||||
£
|
400
|
November 20, 2020
|
Fixed 2.875%
|
||
300
|
November 20, 2025
|
Fixed 3.600%
|
|||
£
|
700
|
Notes Issued
(in millions)
|
Maturity Date
|
Interest Rate
|
Interest Payment Dates
|
||
$
|
750
|
March 13, 2015
|
Fixed 1.000%
|
March 13 and September 13; commencing on March 13, 2013
|
|
1,000
|
September 15, 2017
|
Fixed 1.800%
|
March 15 and September 15; commencing on March 15, 2013
|
||
1,200
|
September 15, 2022
|
Fixed 3.100%
|
March 15 and September 15; commencing on March 15, 2013
|
||
500
|
September 15, 2042
|
Fixed 4.400%
|
March 15 and September 15; commencing on March 15, 2013
|
||
$
|
3,450
|
Notional
(1)
|
Fair Value
|
Location in Consolidated
Condensed Balance Sheets
|
||||||||||
Derivatives designated as fair value hedges
:
|
||||||||||||
Interest rate swaps
|
$
|
1,000
|
$
|
22
|
Other non-current assets
|
|||||||
Derivatives designated as cash flow hedges:
|
||||||||||||
Basis swap
|
71
|
6
|
Other current assets
|
|||||||||
Derivatives not designated as hedges
:
|
||||||||||||
Interest rate swaps
|
1,542
|
-
|
Other current assets
|
|||||||||
Interest rate caps
|
3,879
|
-
|
Other current assets
|
|||||||||
Foreign currency forwards
|
2,037
|
60
|
Other current assets
|
|||||||||
Foreign currency forwards
|
104
|
7
|
Other current liabilities
|
(1) | Amounts in U.S. dollar equivalents, where appropriate. |
Notional
|
Fair Value
|
Location in Consolidated
Condensed Balance Sheets
|
||||||||||
Derivatives designated as fair value hedges
:
|
||||||||||||
Interest rate swaps
|
$
|
1,000
|
$
|
16
|
Other non-current assets
|
|||||||
Derivatives designated as cash flow hedges
:
|
||||||||||||
Forward interest rate swaps
|
1,500
|
44
|
Other non-current liabilities
|
Location in Consolidated
Condensed Statements of Earnings
|
Three Months Ended February 28,
|
Six Months Ended
February 28,
|
||||||||||||||||||
2015
|
2014
|
2015
|
2014
|
|||||||||||||||||
Interest rate swaps
|
Interest expense, net
|
$
|
4
|
$
|
(6
|
)
|
$
|
(6
|
)
|
$
|
(17
|
)
|
||||||||
Notes
|
Interest expense, net
|
(4
|
)
|
6
|
6
|
18
|
Location in Consolidated
Condensed Statements of Earnings
|
Three Months
Ended February 28, 2015
|
Six Months Ended February 28, 2015
|
|||||||
Interest rate swaps
|
Interest expense, net
|
$
|
(1
|
)
|
$
|
(1
|
)
|
||
Foreign currency forwards
|
Selling, general and administrative expense
|
$
|
(28
|
)
|
$
|
(28
|
)
|
||
Second Step Transaction foreign currency forwards
|
Other income (expense)
|
$
|
(70
|
)
|
$
|
(166
|
)
|
Location in Consolidated
Condensed Balance Sheets
|
February 28,
2015
|
August 31,
2014
|
|||||||
Asset derivatives not designated as hedges:
|
|||||||||
Warrants
|
Other non-current assets
|
$
|
2,231
|
$
|
553
|
Location in Consolidated
Condensed Statements of Earnings
|
Three Months
Ended February 28,
|
Six Months Ended
February 28,
|
|||||||||||||||
2015
|
2014
|
2015
|
2014
|
||||||||||||||
Warrants
|
Other income (expense)
|
$
|
559
|
$
|
(64
|
)
|
$
|
849
|
$
|
156
|
Level 1 - | Quoted prices in active markets that are accessible at the measurement date for identical assets and liabilities. The fair value hierarchy gives the highest priority to Level 1 inputs. |
Level 2 - | Observable inputs other than quoted prices in active markets. |
Level 3 - | Unobservable inputs for which there is little or no market data available. The fair value hierarchy gives the lowest priority to Level 3 inputs. |
February 28, 2015
|
Level 1
|
Level 2
|
Level 3
|
|||||||||||||
Assets
:
|
||||||||||||||||
Restricted cash
(1)
|
$
|
206
|
$
|
206
|
$
|
-
|
$
|
-
|
||||||||
Money market funds
(2)
|
1,881
|
1,881
|
-
|
-
|
||||||||||||
Available-for-sale investments
(3)
|
1,255
|
1,255
|
-
|
-
|
||||||||||||
Interest rate swaps
(4)
|
22
|
-
|
22
|
-
|
||||||||||||
Basis swap
|
6
|
-
|
6
|
-
|
||||||||||||
Foreign currency forwards
(5)
|
60
|
-
|
60
|
-
|
||||||||||||
Warrants
(6)
|
2,231
|
-
|
2,231
|
-
|
||||||||||||
Liabilities
:
|
||||||||||||||||
Foreign currency forwards
(5)
|
7
|
-
|
7
|
-
|
August 31, 2014
|
Level 1
|
Level 2
|
Level 3
|
|||||||||||||
Assets
:
|
||||||||||||||||
Money market funds
(2)
|
$
|
1,879
|
$
|
1,879
|
$
|
-
|
$
|
-
|
||||||||
Available-for-sale investments
(3)
|
887
|
887
|
-
|
-
|
||||||||||||
Interest rate swaps
(4)
|
16
|
-
|
16
|
-
|
||||||||||||
Warrants
(5)
|
553
|
-
|
553
|
-
|
||||||||||||
Liabilities
:
|
||||||||||||||||
Forward interest rate swaps
(7)
|
44
|
-
|
44
|
-
|
(1) | Restricted cash consists of deposits restricted under agency agreements and cash restricted by law and other obligations. |
(2) | Money market funds are valued at the closing price reported by the fund sponsor. |
(3) | Fair values of quoted investments are based on current bid prices as of the balance sheet dates. See Note 6, Available-for-Sale Investments for additional disclosures. |
(4) | The fair value of interest rate swaps is calculated by discounting the estimated cash flows received and paid based on the applicable observable yield curves. See Note 10, Financial Instruments for additional disclosures. |
(5) | The fair value of forward currency contracts is estimated by discounting the difference between the contractual forward price and the current available forward price for the residual maturity of the contract using observable market rates. |
(6) | Warrants were valued using a Monte Carlo simulation. Key assumptions used in the valuation include risk-free interest rates using constant maturity treasury rates; the dividend yield for AmerisourceBergen's common stock; AmerisourceBergen's common stock price at the valuation date; AmerisourceBergen's equity volatility; the number of shares of AmerisourceBergen's common stock outstanding; the number of AmerisourceBergen employee stock options and the exercise price; and the details specific to the warrants. |
(7) | Forward interest rate swaps were valued using three-month LIBOR rates. See Note 10, Financial Instruments for additional disclosures. |
Three and Six Months Ended February 28, 2015
|
||||||||
Boots Pension Plan
|
Other Pension Plans
|
|||||||
Service cost
|
$
|
-
|
$
|
1
|
||||
Interest cost
|
52
|
1
|
||||||
Expected return on plan assets
|
(43
|
)
|
-
|
|||||
Settlements
|
-
|
1
|
||||||
Total net periodic pension cost
|
$
|
9
|
$
|
3
|
Postretirement Health Benefit Plan
|
||||||||||||||||
Three Months Ended February 28,
|
Six Months Ended February 28,
|
|||||||||||||||
2015
|
2014
|
2015
|
2014
|
|||||||||||||
Service cost
|
$
|
2
|
$
|
2
|
5
|
$
|
4
|
|||||||||
Interest cost
|
4
|
4
|
8
|
8
|
||||||||||||
Amortization of actuarial loss
|
5
|
3
|
10
|
6
|
||||||||||||
Amortization of prior service cost
|
(6
|
)
|
(6
|
)
|
(12
|
)
|
(11
|
)
|
||||||||
Total postretirement benefit cost
|
$
|
5
|
$
|
3
|
11
|
$
|
7
|
Three Months Ended February 28,
|
Six Months Ended February 28,
|
|||||||||||||||
2015
|
2014
|
2015
|
2014
|
|||||||||||||
Depreciation expense
|
$
|
311
|
$
|
258
|
$
|
567
|
$
|
520
|
||||||||
Intangible asset and other amortization
|
196
|
73
|
259
|
143
|
||||||||||||
Total depreciation and amortization expense
|
$
|
507
|
$
|
331
|
$
|
826
|
$
|
663
|
Post-
retirement
Liability
|
Unrecognized
Gains on
Available-for-
Sale
Investments
|
Unrealized
Loss on
Cash Flow
Hedges
|
Share of
Alliance
Boots
OCI
|
Cumulative
Translation
Adjustments
|
Total
|
|||||||||||||||||||
Balance at November 30, 2014
|
$
|
14
|
$
|
206
|
$
|
(39
|
)
|
$
|
(92
|
)
|
$
|
(35
|
)
|
$
|
54
|
|||||||||
Other comprehensive income (loss) before reclassification adjustments
|
(8
|
)
|
140
|
2
|
(89
|
)
|
(358
|
)
|
(313
|
)
|
||||||||||||||
Amounts reclassified from accumulated OCI
|
-
|
-
|
(1
|
)
|
230
|
80
|
309
|
|||||||||||||||||
Tax benefit (provision)
|
-
|
(50
|
)
|
(1
|
)
|
(49
|
)
|
(18
|
)
|
(118
|
)
|
|||||||||||||
Net other comprehensive income (loss)
|
$
|
(8
|
)
|
$
|
90
|
$
|
-
|
$
|
92
|
$
|
(296
|
)
|
$
|
(122
|
)
|
|||||||||
Balance at February 28, 2015
|
$
|
6
|
$
|
296
|
$
|
(39
|
)
|
$
|
-
|
$
|
(331
|
)
|
$
|
(68
|
)
|
Post-retirement
Liability
|
Unrecognized
Gains on
Available-for-
Sale
Investments
|
Unrealized
Loss on
Cash Flow Hedges
|
Share of
Alliance
Boots
OCI
|
Cumulative
Translation
Adjustments
|
Total
|
|||||||||||||||||||
Balance at August 31, 2014
|
$
|
15
|
$
|
107
|
$
|
(27
|
)
|
$
|
(113
|
)
|
$
|
154
|
$
|
136
|
||||||||||
Other comprehensive income (loss) before reclassification adjustments
|
(10
|
)
|
297
|
(18
|
)
|
(57
|
)
|
(648
|
)
|
(436
|
)
|
|||||||||||||
Amounts reclassified from accumulated OCI
|
-
|
-
|
(1
|
)
|
230
|
80
|
309
|
|||||||||||||||||
Tax benefit (provision)
|
1
|
(108
|
)
|
7
|
(60
|
)
|
83
|
(77
|
)
|
|||||||||||||||
Net other comprehensive income (loss)
|
$
|
(9
|
)
|
$
|
189
|
$
|
(12
|
)
|
$
|
113
|
$
|
(485
|
)
|
$
|
(204
|
)
|
||||||||
Balance at February 28, 2015
|
$
|
6
|
$
|
296
|
$
|
(39
|
)
|
$
|
-
|
$
|
(331
|
)
|
$
|
(68
|
)
|
Post-retirement
Liability
|
Unrecognized
Gains on
Available-for-
Sale
Investments
|
Unrealized
Loss on
Cash Flow Hedges
|
Share of
Alliance
Boots
OCI
|
Cumulative Translation Adjustments
|
Total
|
|||||||||||||||||||
Balance at November 30, 2013
|
$
|
71
|
$
|
85
|
$
|
-
|
$
|
(132
|
)
|
$
|
104
|
$
|
128
|
|||||||||||
Other comprehensive income (loss) before reclassification adjustments
|
(3
|
)
|
(27
|
)
|
-
|
(30
|
)
|
156
|
96
|
|||||||||||||||
Tax benefit (provision)
|
1
|
(22
|
)
|
-
|
11
|
(40
|
)
|
(50
|
)
|
|||||||||||||||
Net other comprehensive income (loss)
|
$
|
(2
|
)
|
$
|
(49
|
)
|
$
|
-
|
$
|
(19
|
)
|
$
|
116
|
$
|
46
|
|||||||||
Balance at February 28, 2014
|
$
|
69
|
$
|
36
|
$
|
-
|
$
|
(151
|
)
|
$
|
220
|
$
|
174
|
Post-retirement
Liability
|
Unrecognized
Gains on
Available-for-
Sale
Investments
|
Unrealized
Loss on
Cash Flow Hedges
|
Share of
Alliance
Boots
OCI
|
Cumulative
Translation
Adjustments
|
Total
|
|||||||||||||||||||
Balance at August 31, 2013
|
$
|
63
|
$
|
1
|
$
|
-
|
$
|
(95
|
)
|
$
|
(61
|
)
|
$
|
(92
|
)
|
|||||||||
Other comprehensive income (loss) before reclassification adjustments
|
9
|
57
|
-
|
(86
|
)
|
407
|
387
|
|||||||||||||||||
Tax benefit (provision)
|
(3
|
)
|
(22
|
)
|
-
|
30
|
(126
|
)
|
(121
|
)
|
||||||||||||||
Net other comprehensive income (loss)
|
$
|
6
|
$
|
35
|
$
|
-
|
$
|
(56
|
)
|
$
|
281
|
$
|
266
|
|||||||||||
Balance at February 28, 2014
|
$
|
69
|
$
|
36
|
$
|
-
|
$
|
(151
|
)
|
$
|
220
|
$
|
174
|
· | The Retail Pharmacy USA segment consists of the legacy Walgreens business, which includes the operation of retail drugstores and convenient care clinics, in addition to providing specialty and infusion and respiratory pharmacy services. Revenues for the segment are principally derived from the sale of prescription drugs and a wide assortment of general merchandise, including non-prescription drugs, beauty products, photo finishing, seasonal merchandise, greeting cards and convenience foods. |
· | The Retail Pharmacy International segment consists primarily of the legacy Alliance Boots pharmacy-led health and beauty stores, optical practices, and related contract manufacturing operations. Stores are located in the UK, Mexico, Chile, Thailand, Norway, Republic of Ireland, The Netherlands and Lithuania. Revenues for the segment are principally derived from the sale of prescription drugs and retail health, beauty, toiletries and other consumer products. |
· | The Pharmaceutical Wholesale segment consists of the legacy Alliance Boots pharmaceutical wholesaling and distribution businesses. Wholesale operations are located in France, UK, Germany, Turkey, Spain, Russia, The Netherlands, Egypt, Norway, Romania, Czech Republic and Lithuania. Revenues for the segment are principally derived from wholesaling and distribution of a comprehensive offering of brand-name pharmaceuticals (including specialty pharmaceutical products) and generic pharmaceuticals, health and beauty products, home healthcare supplies and equipment, and related services to pharmacies and other healthcare providers. |
Retail Pharmacy
|
||||||||||||||||||||
USA
|
International
|
Pharmaceutical
Wholesale
|
Eliminations
and
Unallocated
Items
|
Consolidated
|
||||||||||||||||
Three Months Ended February 28, 2015
|
||||||||||||||||||||
Sales to external customers
|
$
|
21,048
|
$
|
2,017
|
$
|
3,508
|
$
|
-
|
$
|
26,573
|
||||||||||
Intersegment sales
|
-
|
30
|
357
|
(387
|
)
|
-
|
||||||||||||||
Total Sales
|
21,048
|
2,047
|
3,865
|
(387
|
)
|
26,573
|
||||||||||||||
Cost of sales
|
15,302
|
1,294
|
3,478
|
(383
|
)
|
19,691
|
||||||||||||||
Gross Profit
|
5,746
|
753
|
387
|
(4
|
)
|
6,882
|
||||||||||||||
Selling, general and administrative expenses
|
4,555
|
745
|
306
|
-
|
5,606
|
|||||||||||||||
Equity earnings in Alliance Boots
|
101
|
-
|
-
|
-
|
101
|
|||||||||||||||
Operating Income
|
$
|
1,292
|
$
|
8
|
$
|
81
|
$
|
(4
|
)
|
$
|
1,377
|
|||||||||
Three Months Ended February 28, 2014
|
||||||||||||||||||||
Sales to external customers
|
$
|
19,605
|
$
|
-
|
$
|
-
|
$
|
-
|
$
|
19,605
|
||||||||||
Intersegment sales
|
-
|
-
|
-
|
-
|
-
|
|||||||||||||||
Total Sales
|
19,605
|
-
|
-
|
-
|
19,605
|
|||||||||||||||
Cost of sales
|
13,955
|
-
|
-
|
-
|
13,995
|
|||||||||||||||
Gross Profit
|
5,650
|
-
|
-
|
-
|
5,650
|
|||||||||||||||
Selling, general and administrative expenses
|
4,569
|
-
|
-
|
-
|
4,569
|
|||||||||||||||
Equity earnings in Alliance Boots
|
136
|
-
|
-
|
-
|
136
|
|||||||||||||||
Operating Income
|
$
|
1,217
|
$
|
-
|
$
|
-
|
$
|
-
|
$
|
1,217
|
Retail Pharmacy
|
||||||||||||||||||||
USA
|
International
|
Pharmaceutical Wholesale
|
Eliminations
and
Unallocated
Items
|
Consolidated
|
||||||||||||||||
Six Months Ended February 28, 2015
|
||||||||||||||||||||
Sales to external customers
|
$
|
40,602
|
$
|
2,017
|
$
|
3,508
|
$
|
-
|
$
|
46,127
|
||||||||||
Intersegment sales
|
-
|
30
|
357
|
(387
|
)
|
-
|
||||||||||||||
Total Sales
|
40,602
|
2,047
|
3,865
|
(387
|
)
|
46,127
|
||||||||||||||
Cost of sales
|
29,560
|
1,294
|
3,478
|
(383
|
)
|
33,949
|
||||||||||||||
Gross Profit
|
11,042
|
753
|
387
|
(4
|
)
|
12,178
|
||||||||||||||
Selling, general and administrative expenses
|
9,011
|
745
|
306
|
-
|
10,062
|
|||||||||||||||
Equity earnings in Alliance Boots
|
315
|
-
|
-
|
-
|
315
|
|||||||||||||||
Operating Income
|
$
|
2,346
|
$
|
8
|
$
|
81
|
$
|
(4
|
)
|
$
|
2,431
|
|||||||||
Six Months Ended February 28, 2014
|
||||||||||||||||||||
Sales to external customers
|
$
|
37,934
|
$
|
-
|
$
|
-
|
$
|
-
|
$
|
37,934
|
||||||||||
Intersegment sales
|
-
|
-
|
-
|
-
|
-
|
|||||||||||||||
Total Sales
|
37,934
|
-
|
-
|
-
|
37,934
|
|||||||||||||||
Cost of sales
|
27,132
|
-
|
-
|
-
|
27,132
|
|||||||||||||||
Gross Profit
|
10,802
|
-
|
-
|
-
|
10,802
|
|||||||||||||||
Selling, general and administrative expenses
|
8,948
|
-
|
-
|
-
|
8,948
|
|||||||||||||||
Equity earnings in Alliance Boots
|
330
|
-
|
-
|
-
|
330
|
|||||||||||||||
Operating Income
|
$
|
2,184
|
$
|
-
|
$
|
-
|
$
|
-
|
$
|
2,184
|
||||||||||
Total assets:
|
||||||||||||||||||||
February 28, 2015
|
$
|
77,466
|
$
|
22,131
|
$
|
13,706
|
$
|
(41,946
|
)
|
$
|
71,357
|
|||||||||
August 31, 2014
|
44,275
|
-
|
-
|
(7,005
|
)
|
37,270
|
For the Three Months Ended
|
For the Six Months Ended
|
|||||||||||||||
February 28,
2015
|
February 28,
2014
|
February 28,
2015
|
February 28,
2014
|
|||||||||||||
Operating income:
|
||||||||||||||||
Retail Pharmacy USA
|
$
|
1,292
|
$
|
1,217
|
$
|
2,346
|
$
|
2,184
|
||||||||
Retail Pharmacy International
|
8
|
-
|
8
|
-
|
||||||||||||
Pharmaceutical Wholesale
|
81
|
-
|
81
|
-
|
||||||||||||
Eliminations/Other
|
(4
|
)
|
-
|
(4
|
)
|
-
|
||||||||||
Gain on previously held equity interest
|
706
|
-
|
706
|
-
|
||||||||||||
Other (expense) income
|
504
|
(59
|
)
|
703
|
166
|
|||||||||||
Earnings Before Interest and Tax provision (EBIT)
|
$
|
2,587
|
$
|
1,158
|
$
|
3,840
|
$
|
2,350
|
Notes Issued
(in millions)
|
Maturity Date
|
Interest Rate
|
||
$
|
750
|
May 18, 2016
|
Variable; three-month U.S. dollar LIBOR, reset quarterly, plus 45 basis points
|
|
750
|
November 17, 2017
|
Fixed 1.750%
|
||
1,250
|
November 18, 2019
|
Fixed 2.700%
|
||
1,250
|
November 18, 2021
|
Fixed 3.300%
|
||
2,000
|
November 18, 2024
|
Fixed 3.800%
|
||
500
|
November 18, 2034
|
Fixed 4.500%
|
||
1,500
|
November 18, 2044
|
Fixed 4.800%
|
||
$
|
8,000
|
Notes Issued (in millions)
|
Maturity Date
|
Interest Rate
|
||
Euro Notes:
|
||||
€
|
750
|
November 20, 2026
|
Fixed 2.125%
|
|
Pound Sterling Notes:
|
||||
£
|
400
|
November 20, 2020
|
Fixed 2.875%
|
|
300
|
November 20, 2025
|
Fixed 3.600%
|
||
£
|
700
|
Three Months Ended February 28, 2015
|
||||||||||||||||||||
Guarantor/
Issuer
Subsidiary
|
Non-guarantor
Subsidiaries
|
Parent
Company
|
Consolidating
Adjustments
|
Consolidated
|
||||||||||||||||
Net sales
|
$
|
14,379
|
$
|
12,545
|
$
|
-
|
$
|
(351
|
)
|
$
|
26,573
|
|||||||||
Cost of sales
|
9,949
|
10,033
|
-
|
(291
|
)
|
19,691
|
||||||||||||||
Gross Profit
|
4,430
|
2,512
|
-
|
(60
|
)
|
6,882
|
||||||||||||||
Selling, general and administrative expenses
|
4,596
|
1,117
|
(47
|
)
|
(60
|
)
|
5,606
|
|||||||||||||
Equity earnings in Alliance Boots
|
-
|
101
|
-
|
-
|
101
|
|||||||||||||||
Operating Income (loss)
|
(166
|
)
|
1,496
|
47
|
-
|
1,377
|
||||||||||||||
Gain on previously held equity interest
|
-
|
706
|
-
|
-
|
706
|
|||||||||||||||
Other income (expense)
|
(69
|
)
|
575
|
(2
|
)
|
-
|
504
|
|||||||||||||
Earnings (loss) before Interest and Tax Provision
|
(235
|
)
|
2,777
|
45
|
-
|
2,587
|
||||||||||||||
Interest expense, net
|
106
|
6
|
32
|
-
|
144
|
|||||||||||||||
Earnings (loss) Before Income Tax Provision
|
(341
|
)
|
2,771
|
13
|
-
|
2,443
|
||||||||||||||
Income tax provision
|
(171
|
)
|
557
|
5
|
-
|
391
|
||||||||||||||
Post tax earnings from equity method investments
|
-
|
8
|
-
|
-
|
8
|
|||||||||||||||
Equity in income of subsidiaries
|
2,222
|
-
|
2,052
|
(4,274
|
)
|
-
|
||||||||||||||
Net Earnings (loss)
|
2,052
|
2,222
|
2,060
|
(4,274
|
)
|
2,060
|
||||||||||||||
Net earnings attributable to noncontrolling interests
|
-
|
18
|
-
|
-
|
18
|
|||||||||||||||
Net Earnings (loss) Attributable to Walgreens Boots Alliance, Inc.
|
$
|
2,052
|
$
|
2,204
|
$
|
2,060
|
$
|
(4,274
|
)
|
$
|
2,042
|
Three Months Ended February 28, 2014
|
||||||||||||||||||||
Guarantor/
Issuer
Subsidiary
|
Non-guarantor
Subsidiaries
|
Parent
Company
|
Consolidating
Adjustments
|
Consolidated
|
||||||||||||||||
Net sales
|
$
|
13,364
|
$
|
6,363
|
$
|
-
|
$
|
(122
|
)
|
$
|
19,605
|
|||||||||
Cost of sales
|
9,027
|
4,985
|
-
|
(57
|
)
|
13,955
|
||||||||||||||
Gross Profit
|
4,337
|
1,378
|
-
|
(65
|
)
|
5,650
|
||||||||||||||
Selling, general and administrative expenses
|
4,095
|
539
|
-
|
(65
|
)
|
4,569
|
||||||||||||||
Equity earnings in Alliance Boots
|
-
|
136
|
-
|
-
|
136
|
|||||||||||||||
Operating Income
|
242
|
975
|
-
|
-
|
1,217
|
|||||||||||||||
Gain on previously held equity interest
|
-
|
-
|
-
|
-
|
-
|
|||||||||||||||
Other income (expense)
|
-
|
(59
|
)
|
-
|
-
|
(59
|
)
|
|||||||||||||
Earnings Before Interest and Tax Provision
|
242
|
916
|
-
|
-
|
1,158
|
|||||||||||||||
Interest expense, net
|
45
|
(8
|
)
|
-
|
-
|
37
|
||||||||||||||
Earnings Before Income Tax Provision
|
197
|
924
|
-
|
-
|
1,121
|
|||||||||||||||
Income tax provision
|
69
|
322
|
-
|
-
|
391
|
|||||||||||||||
Equity in income of subsidiaries
|
602
|
-
|
-
|
(602
|
)
|
-
|
||||||||||||||
Net Earnings (loss)
|
730
|
602
|
-
|
(602
|
)
|
730
|
||||||||||||||
Net earnings attributable to noncontrolling interests
|
-
|
14
|
-
|
-
|
14
|
|||||||||||||||
Net Earnings (loss) Attributable to Walgreens Boots Alliance, Inc.
|
$
|
730
|
$
|
588
|
$
|
-
|
$
|
(602
|
)
|
$
|
716
|
Six Months Ended February 28, 2015
|
||||||||||||||||||||
Guarantor/
Issuer
Subsidiary
|
Non-guarantor
Subsidiaries
|
Parent
Company
|
Consolidating
Adjustments
|
Consolidated
|
||||||||||||||||
Net sales
|
$
|
27,702
|
$
|
19,168
|
$
|
-
|
$
|
(743
|
)
|
$
|
46,127
|
|||||||||
Cost of sales
|
19,160
|
15,416
|
-
|
(627
|
) |
33,949
|
||||||||||||||
Gross Profit
|
8,542
|
3,752
|
-
|
(116
|
)
|
12,178
|
||||||||||||||
Selling, general and administrative expenses
|
8,608
|
1,617
|
(47
|
) |
(116
|
)
|
10,062
|
|||||||||||||
Equity earnings in Alliance Boots
|
-
|
315
|
-
|
-
|
315
|
|||||||||||||||
Operating Income (loss)
|
(66
|
)
|
2,450
|
47
|
-
|
2,431
|
||||||||||||||
Gain on previously held equity interest
|
-
|
706
|
-
|
-
|
706
|
|||||||||||||||
Other income (expense)
|
(166
|
)
|
871
|
(2
|
)
|
-
|
703
|
|||||||||||||
Earnings (loss) Before Interest and Tax Provision
|
(232
|
)
|
4,027
|
45
|
-
|
3,840
|
||||||||||||||
Interest expense, net
|
153
|
-
|
46
|
-
|
199
|
|||||||||||||||
Earnings (loss) Before Income Tax Provision
|
(385
|
)
|
4,027
|
(1
|
)
|
-
|
3,641
|
|||||||||||||
Income tax provision
|
(190
|
)
|
902
|
-
|
-
|
712
|
||||||||||||||
Post tax earnings from equity method investments
|
-
|
8
|
-
|
-
|
8
|
|||||||||||||||
Equity in income of subsidiaries
|
3,133
|
-
|
2,938
|
(6,071
|
)
|
-
|
||||||||||||||
Net Earnings (loss)
|
2,938
|
3,133
|
2,937
|
|
(6,071
|
)
|
2,937
|
|||||||||||||
Net earnings attributable to noncontrolling interests
|
-
|
45
|
-
|
-
|
45
|
|||||||||||||||
Net Earnings (loss) Attributable to Walgreens Boots Alliance, Inc.
|
$
|
2,938
|
$
|
3,088
|
$
|
2,937
|
|
$
|
(6,071
|
)
|
$
|
2,892
|
Six Months Ended February 28, 2014
|
||||||||||||||||||||
Guarantor/
Issuer
Subsidiary
|
Non-guarantor
Subsidiaries
|
Parent
Company
|
Consolidating
Adjustments
|
Consolidated
|
||||||||||||||||
Net sales
|
$
|
25,872
|
$
|
12,278
|
$
|
-
|
$
|
(216
|
)
|
$
|
37,934
|
|||||||||
Cost of sales
|
17,599
|
9,632
|
-
|
(99
|
)
|
27,132
|
||||||||||||||
Gross Profit
|
8,273
|
2,646
|
-
|
(117
|
)
|
10,802
|
||||||||||||||
Selling, general and administrative expenses
|
7,753
|
1,312
|
-
|
(117
|
)
|
8,948
|
||||||||||||||
Equity earnings in Alliance Boots
|
-
|
330
|
-
|
-
|
330
|
|||||||||||||||
Operating Income (loss)
|
520
|
1,664
|
-
|
-
|
2,184
|
|||||||||||||||
Gain on previously held equity interest
|
-
|
-
|
-
|
-
|
-
|
|||||||||||||||
Other income (expense)
|
-
|
166
|
-
|
-
|
166
|
|||||||||||||||
Earnings Before Interest and Tax Provision
|
520
|
1,830
|
-
|
-
|
2,350
|
|||||||||||||||
Interest expense, net
|
90
|
(12
|
)
|
-
|
-
|
78
|
||||||||||||||
Earnings Before Income Tax Provision
|
430
|
1,842
|
-
|
-
|
2,272
|
|||||||||||||||
Income tax provision
|
163
|
647
|
-
|
-
|
810
|
|||||||||||||||
Equity in income of subsidiaries
|
1,195
|
-
|
-
|
(1,195
|
)
|
-
|
||||||||||||||
Net Earnings (loss)
|
1,462
|
1,195
|
-
|
(1,195
|
)
|
1,462
|
||||||||||||||
Net earnings attributable to noncontrolling interests
|
-
|
23
|
-
|
-
|
23
|
|||||||||||||||
Net Earnings (loss) Attributable to Walgreens Boots Alliance, Inc.
|
$
|
1,462
|
$
|
1,172
|
$
|
-
|
$
|
(1,195
|
)
|
$
|
1,439
|
Three Months Ended February 28, 2015
|
||||||||||||||||||||
Guarantor/
Issuer
Subsidiary
|
Non-guarantor
Subsidiaries
|
Parent
Company
|
Consolidating
Adjustments
|
Consolidated
|
||||||||||||||||
Comprehensive Income
|
||||||||||||||||||||
Net Earnings (loss)
|
$
|
2,052
|
$
|
2,222
|
$
|
2,060
|
$
|
(4,274
|
)
|
$
|
2,060
|
|||||||||
Other comprehensive income (loss), net of tax:
|
||||||||||||||||||||
Postretirement liability
|
(1
|
)
|
(7
|
)
|
-
|
-
|
(8
|
)
|
||||||||||||
Unrealized gain (loss) on cash flow hedges
|
-
|
(1
|
)
|
1
|
-
|
-
|
||||||||||||||
Changes in unrecognized gain (loss) on available-for-sale investments
|
-
|
90
|
-
|
-
|
90
|
|||||||||||||||
Share of other comprehensive income (loss) of Alliance Boots
|
-
|
92
|
-
|
-
|
92
|
|||||||||||||||
Currency translation adjustments
|
-
|
(301
|
)
|
-
|
-
|
(301
|
)
|
|||||||||||||
Other Comprehensive Income (loss) of subsidiaries
|
(127
|
)
|
-
|
(128
|
) |
255
|
-
|
|||||||||||||
Total Other Comprehensive Income (loss)
|
(128
|
)
|
(127
|
)
|
(127
|
) |
255
|
(127
|
)
|
|||||||||||
Total Comprehensive Income (loss)
|
1,924
|
2,095
|
1,933
|
(4,019
|
)
|
1,933
|
||||||||||||||
Comprehensive income attributable to noncontrolling interests
|
-
|
13
|
-
|
-
|
13
|
|||||||||||||||
Comprehensive income attributable to Walgreens Boots Alliance, Inc.
|
$
|
1,924
|
$
|
2,082
|
$
|
1,933
|
$
|
(4,019
|
)
|
$
|
1,920
|
Six Months Ended February 28, 2015
|
||||||||||||||||||||
Guarantor/
Issuer
Subsidiary
|
Non-guarantor
Subsidiaries
|
Parent
Company
|
Consolidating
Adjustments
|
Consolidated
|
||||||||||||||||
Comprehensive Income
|
||||||||||||||||||||
Net Earnings (loss)
|
$
|
2,938
|
$
|
3,133
|
$
|
2,937
|
|
$
|
(6,071
|
)
|
$
|
2,937
|
||||||||
Other comprehensive income (loss), net of tax:
|
||||||||||||||||||||
Postretirement liability
|
(2
|
)
|
(7
|
)
|
-
|
-
|
(9
|
)
|
||||||||||||
Unrealized gain (loss) on cash flow hedges
|
27
|
(1
|
) |
(38
|
)
|
-
|
(12
|
)
|
||||||||||||
Changes in unrecognized gain (loss) on available-for-sale investments
|
-
|
189
|
-
|
-
|
189
|
|||||||||||||||
Share of other comprehensive income (loss) of Alliance Boots
|
-
|
113
|
-
|
-
|
113
|
|||||||||||||||
Currency translation adjustments
|
-
|
(490
|
)
|
-
|
-
|
(490
|
)
|
|||||||||||||
Other Comprehensive Income (loss) of subsidiaries
|
(196
|
) |
-
|
(171
|
) |
367
|
|
-
|
||||||||||||
Total Other Comprehensive Income (Loss)
|
(171
|
) |
(196
|
)
|
(209
|
)
|
367
|
(209
|
)
|
|||||||||||
Total Comprehensive Income (loss)
|
2,767
|
2,937
|
2,728
|
|
(5,704
|
)
|
2,728
|
|||||||||||||
Comprehensive income attributable to noncontrolling interests
|
-
|
40
|
-
|
-
|
40
|
|||||||||||||||
Comprehensive income attributable to Walgreens Boots Alliance, Inc.
|
$
|
2,767
|
$
|
2,897
|
$
|
2,728
|
|
$
|
(5,704
|
)
|
$
|
2,688
|
Three Months Ended February 28, 2014
|
||||||||||||||||||||
Guarantor/
Issuer
Subsidiary
|
Non-guarantor
Subsidiaries
|
Parent
Company
|
Consolidating
Adjustments
|
Consolidated
|
||||||||||||||||
Comprehensive Income
|
||||||||||||||||||||
Net Earnings (loss)
|
$
|
730
|
$
|
602
|
$
|
-
|
$
|
(602
|
)
|
$
|
730
|
|||||||||
Other comprehensive income (loss), net of tax:
|
||||||||||||||||||||
Postretirement liability
|
(2
|
)
|
-
|
-
|
-
|
(2
|
)
|
|||||||||||||
Unrealized gain (loss) on cash flow hedges
|
-
|
-
|
-
|
-
|
-
|
|||||||||||||||
Changes in unrecognized gain (loss) on available-for-sale investments
|
-
|
(49
|
)
|
-
|
-
|
(49
|
)
|
|||||||||||||
Share of other comprehensive income (loss) of Alliance Boots
|
-
|
(19
|
)
|
-
|
-
|
(19
|
)
|
|||||||||||||
Currency translation adjustments
|
-
|
116
|
-
|
-
|
116
|
|||||||||||||||
Other Comprehensive Income (loss) of subsidiaries
|
48
|
-
|
-
|
(48
|
)
|
-
|
||||||||||||||
Total Other Comprehensive Income (loss)
|
46
|
48
|
-
|
(48
|
)
|
46
|
||||||||||||||
Total Comprehensive Income (loss)
|
776
|
650
|
-
|
(650
|
)
|
776
|
||||||||||||||
Comprehensive income attributable to noncontrolling interests
|
-
|
14
|
-
|
-
|
14
|
|||||||||||||||
Comprehensive income attributable to Walgreens Boots Alliance, Inc.
|
$
|
776
|
$
|
636
|
$
|
-
|
$
|
(650
|
)
|
$
|
762
|
Six Months Ended February 28, 2014
|
||||||||||||||||||||
Guarantor/
Issuer
Subsidiary
|
Non-guarantor
Subsidiaries
|
Parent
Company
|
Consolidating
Adjustments
|
Consolidated
|
||||||||||||||||
Comprehensive Income
|
||||||||||||||||||||
Net Earnings (loss)
|
$
|
1,462
|
$
|
1,195
|
$
|
-
|
$
|
(1,195
|
)
|
$
|
1,462
|
|||||||||
Other comprehensive income (loss), net of tax:
|
||||||||||||||||||||
Postretirement liability
|
6
|
-
|
-
|
-
|
6
|
|||||||||||||||
Unrealized gain (loss) on cash flow hedges
|
-
|
-
|
-
|
-
|
-
|
|||||||||||||||
Changes in unrecognized gain (loss) on available-for-sale investments
|
-
|
35
|
-
|
-
|
35
|
|||||||||||||||
Share of other comprehensive income (loss) of Alliance Boots
|
-
|
(56
|
)
|
-
|
-
|
(56
|
)
|
|||||||||||||
Currency translation adjustments
|
-
|
281
|
-
|
-
|
281
|
|||||||||||||||
Other Comprehensive Income (loss) of subsidiaries
|
260
|
-
|
-
|
(260
|
)
|
-
|
||||||||||||||
Total Other Comprehensive Income (loss)
|
266
|
260
|
-
|
(260
|
)
|
266
|
||||||||||||||
Total Comprehensive Income (loss)
|
1,728
|
1,455
|
-
|
(1,455
|
)
|
1,728
|
||||||||||||||
Comprehensive income attributable to noncontrolling interests
|
-
|
23
|
-
|
-
|
23
|
|||||||||||||||
Comprehensive income attributable to Walgreens Boots Alliance, Inc.
|
$
|
1,728
|
$
|
1,432
|
$
|
-
|
$
|
(1,455
|
)
|
$
|
1,705
|
February 28, 2015
|
||||||||||||||||||||
Guarantor/
Issuer
Subsidiary
|
Non-guarantor
Subsidiaries
|
Parent
Company
|
Consolidating
Adjustments
|
Consolidated
|
||||||||||||||||
Assets
|
||||||||||||||||||||
Current Assets:
|
||||||||||||||||||||
Cash and cash equivalents
|
$
|
1,840
|
$
|
1,165
|
$
|
-
|
$
|
-
|
$
|
3,005
|
||||||||||
Accounts receivable, net
|
2,027
|
4,990
|
-
|
- |
|
7,017
|
||||||||||||||
Inventories
|
4,396
|
4,983
|
-
|
- |
|
9,379
|
||||||||||||||
Current intercompany loan receivable
|
12,930
|
26,428
|
20,720
|
(60,078
|
)
|
-
|
||||||||||||||
Other current assets
|
533
|
1,005
|
11
|
(235
|
)
|
1,314
|
||||||||||||||
Total Current Assets
|
21,726
|
38,571
|
20,731
|
(60,313
|
)
|
20,715
|
||||||||||||||
Non-Current Assets:
|
||||||||||||||||||||
Property, plant and equipment, at cost, less accumulated depreciation and amortization
|
6,500
|
9,146
|
-
|
- |
|
15,646
|
||||||||||||||
Equity investment in Alliance Boots
|
-
|
-
|
-
|
-
|
-
|
|||||||||||||||
Goodwill
|
8,382
|
8,662
|
-
|
-
|
17,044
|
|||||||||||||||
Intangible assets
|
286
|
11,939
|
-
|
-
|
12,225
|
|||||||||||||||
Other non-current assets
|
162
|
5,561
|
4
|
-
|
5,727
|
|||||||||||||||
Non-current intercompany loan receivable
|
-
|
3,725
|
19,113
|
(22,838
|
)
|
-
|
||||||||||||||
Investment in subsidiaries
|
32,379
|
-
|
27,039
|
(59,418
|
)
|
-
|
||||||||||||||
Total Non-Current Assets
|
47,709
|
39,033
|
46,156
|
(82,256
|
)
|
50,642
|
||||||||||||||
Total Assets
|
$
|
69,435
|
$
|
77,604
|
$
|
66,887
|
$
|
(142,569
|
)
|
$
|
71,357
|
|||||||||
Liabilities & Equity
|
||||||||||||||||||||
Current Liabilities:
|
||||||||||||||||||||
Short-term borrowings
|
$
|
757
|
$
|
304
|
$
|
-
|
$
|
-
|
$
|
1,061
|
||||||||||
Trade accounts payable
|
4,355
|
5,938
|
-
|
-
|
10,293
|
|||||||||||||||
Current intercompany loan payable
|
12,258
|
24,604
|
23,216
|
(60,078
|
)
|
-
|
||||||||||||||
Accrued expenses and other liabilities
|
2,508
|
2,153
|
479
|
- |
|
5,140
|
||||||||||||||
Income taxes
|
-
|
|
225
|
206
|
(235
|
) |
196
|
|||||||||||||
Total Current Liabilities
|
19,878
|
33,224
|
23,901
|
(60,313
|
)
|
16,690
|
||||||||||||||
Non-Current Liabilities:
|
||||||||||||||||||||
Long-term debt
|
3,737
|
128
|
12,136
|
-
|
16,001
|
|||||||||||||||
Deferred income taxes
|
283
|
3,406
|
-
|
-
|
3,689
|
|||||||||||||||
Non-current intercompany loan payable
|
15,983
|
6,855
|
-
|
(22,838
|
)
|
-
|
||||||||||||||
Other non-current liabilities
|
2,515
|
1,400
|
|
36
|
-
|
3,951
|
||||||||||||||
Total Non-Current Liabilities
|
22,518
|
11,789
|
12,172
|
(22,838
|
)
|
23,641
|
||||||||||||||
Equity:
|
||||||||||||||||||||
Total Walgreens Boots Alliance, Inc. Shareholders' Equity
|
27,039
|
32,379
|
30,814
|
(59,418
|
)
|
30,814
|
||||||||||||||
Noncontrolling interests
|
-
|
212
|
-
|
-
|
212
|
|||||||||||||||
Total Equity
|
27,039
|
32,591
|
30,814
|
(59,418
|
)
|
31,026
|
||||||||||||||
Total Liabilities & Equity
|
$
|
69,435
|
$
|
77,604
|
$
|
66,887
|
$
|
(142,569
|
)
|
$
|
71,357
|
August 31, 2014
|
||||||||||||||||||||
Guarantor/
Issuer
Subsidiary
|
Non-guarantor
Subsidiaries
|
Parent
Company
|
Consolidating
Adjustments
|
Consolidated
|
||||||||||||||||
Assets
|
||||||||||||||||||||
Current Assets:
|
||||||||||||||||||||
Cash and cash equivalents
|
$
|
2,224
|
$
|
422
|
$
|
-
|
$
|
-
|
$
|
2,646
|
||||||||||
Accounts receivable, net
|
1,860
|
1,358
|
-
|
-
|
|
3,218
|
||||||||||||||
Inventories
|
4,301
|
1,755
|
-
|
-
|
|
6,076
|
||||||||||||||
Current intercompany loan receivable
|
6,755
|
8,277
|
-
|
(15,032
|
)
|
-
|
||||||||||||||
Other current assets
|
176
|
141
|
-
|
(15
|
)
|
302
|
||||||||||||||
Total Current Assets
|
15,316
|
11,973
|
-
|
(15,047
|
)
|
12,242
|
||||||||||||||
Non-Current Assets:
|
||||||||||||||||||||
Property, plant and equipment, at cost, less accumulated depreciation and amortization
|
6,932
|
5,325
|
-
|
-
|
|
12,257
|
||||||||||||||
Equity investment in Alliance Boots
|
-
|
7,336
|
-
|
-
|
7,336
|
|||||||||||||||
Goodwill
|
343
|
2,016
|
-
|
-
|
2,359
|
|||||||||||||||
Intangible assets
|
417
|
763
|
-
|
-
|
1,180
|
|||||||||||||||
Other non-current assets
|
252
|
1,644
|
-
|
-
|
|
1,896
|
||||||||||||||
Non-current intercompany loan receivable
|
- |
3,560
|
-
|
(3,560
|
)
|
-
|
||||||||||||||
Investment in subsidiaries
|
23,250
|
-
|
-
|
(23,250
|
)
|
-
|
||||||||||||||
Total Non-Current Assets
|
31,194
|
20,644
|
-
|
(26,810
|
)
|
25,028
|
||||||||||||||
Total Assets
|
$ |
46,510
|
$ |
32,617
|
$ |
-
|
$ |
(41,857
|
)
|
$ |
37,270
|
|||||||||
Liabilities & Equity
|
||||||||||||||||||||
Current Liabilities:
|
||||||||||||||||||||
Short-term borrowings
|
$ |
766
|
$ |
8
|
$ |
-
|
$ |
-
|
$ |
774
|
||||||||||
Trade accounts payable
|
3,850
|
465
|
-
|
-
|
|
4,315
|
||||||||||||||
Current intercompany loan payable
|
8,277
|
6,755
|
-
|
(15,032
|
)
|
-
|
||||||||||||||
Accrued expenses and other liabilities
|
3,044
|
657
|
-
|
-
|
|
3,701
|
||||||||||||||
Income taxes
|
-
|
|
120
|
-
|
(15
|
) |
105
|
|||||||||||||
Total Current Liabilities
|
15,937
|
8,005
|
-
|
(15,047
|
)
|
8,895
|
||||||||||||||
Non-Current Liabilities:
|
||||||||||||||||||||
Long-term debt
|
3,726
|
10
|
-
|
-
|
3,736
|
|||||||||||||||
Deferred income taxes
|
404
|
676
|
-
|
-
|
1,080
|
|||||||||||||||
Non-current intercompany loan payable
|
3,560
|
-
|
-
|
(3,560
|
)
|
-
|
||||||||||||||
Other non-current liabilities
|
2,370
|
572
|
-
|
-
|
2,942
|
|||||||||||||||
Total Non-Current Liabilities
|
10,060
|
1,258
|
-
|
(3,560
|
)
|
7,758
|
||||||||||||||
Equity:
|
||||||||||||||||||||
Total Walgreens Boots Alliance, Inc. Shareholders' Equity
|
20,513
|
23,250
|
-
|
(23,250
|
)
|
20,513
|
||||||||||||||
Noncontrolling interests
|
-
|
104
|
-
|
-
|
104
|
|||||||||||||||
Total Equity
|
20,513
|
23,354
|
-
|
(23,250
|
)
|
20,617
|
||||||||||||||
Total Liabilities & Equity
|
$
|
46,510
|
$
|
32,617
|
$
|
-
|
$
|
(41,857
|
)
|
$
|
37,270
|
Six Months Ended February 28, 2015
|
||||||||||||||||||||
Guarantor/
Issuer
Subsidiary
|
Non-guarantor
Subsidiaries
|
Parent
Company
|
Consolidating
Adjustments
|
Consolidated
|
||||||||||||||||
Cash Flows from Operating Activities
|
$ |
1,011
|
$ |
1,254
|
$ |
72
|
|
$ |
-
|
$ |
2,337
|
|||||||||
Cash Flows from Investing Activities
:
|
||||||||||||||||||||
Additions to property, plant and equipment
|
(302
|
)
|
(341
|
)
|
-
|
-
|
(643
|
)
|
||||||||||||
Proceeds from sale of assets
|
121
|
458
|
-
|
-
|
579
|
|||||||||||||||
Return of restricted cash
|
-
|
74
|
-
|
-
|
74
|
|||||||||||||||
Alliance Boots acquisition, net of cash received
|
-
|
-
|
(4,461
|
)
|
-
|
(4,461
|
)
|
|||||||||||||
Other business and intangible asset acquisitions, net of cash received
|
(27
|
)
|
(65
|
)
|
-
|
-
|
(92
|
)
|
||||||||||||
Purchases of short-term investments held to maturity
|
-
|
(29
|
)
|
-
|
-
|
(29
|
)
|
|||||||||||||
Proceeds from short-term investments held to maturity
|
-
|
29
|
-
|
-
|
29
|
|||||||||||||||
Investment in AmerisourceBergen
|
-
|
-
|
-
|
-
|
-
|
|||||||||||||||
Other
|
(165
|
)
|
-
|
-
|
-
|
(165
|
)
|
|||||||||||||
Net cash used for investing activities
|
(373
|
)
|
126
|
(4,461
|
)
|
-
|
(4,708
|
)
|
||||||||||||
Cash Flows from Financing Activities
:
|
||||||||||||||||||||
Payments of short-term borrowings
|
-
|
(324
|
) |
(6
|
)
|
-
|
(330
|
)
|
||||||||||||
Proceeds from issuance of long-term debt
|
-
|
-
|
12,279
|
-
|
12,279
|
|||||||||||||||
Payments of long-term debt
|
-
|
(7,817
|
)
|
-
|
-
|
(7,817
|
)
|
|||||||||||||
Stock purchases
|
(500
|
)
|
-
|
(94
|
)
|
-
|
(594
|
)
|
||||||||||||
Proceeds related to employee stock plans
|
154
|
-
|
139
|
-
|
293
|
|||||||||||||||
Cash dividends paid
|
(642
|
)
|
-
|
-
|
-
|
(642
|
)
|
|||||||||||||
Intra-company financing activities, net
|
(36) | 7,817 | (7,781 | ) | - | - | ||||||||||||||
Other
|
2
|
(286
|
)
|
(76
|
)
|
-
|
(360
|
)
|
||||||||||||
Net cash (used for) provided by financing activities
|
(1,022
|
)
|
(610
|
)
|
4,461
|
-
|
2,829
|
|||||||||||||
Effect of exchange rate changes on cash and cash equivalents
|
-
|
(27
|
)
|
(72
|
) |
-
|
(99
|
)
|
||||||||||||
Changes in Cash and Cash Equivalents
:
|
||||||||||||||||||||
Net (decrease) increase in cash and cash equivalents
|
(384
|
)
|
743
|
-
|
-
|
359
|
||||||||||||||
Cash and cash equivalents at beginning of period
|
2,224
|
422
|
-
|
-
|
2,646
|
|||||||||||||||
Cash and cash equivalents at end of period
|
$
|
1,840
|
$
|
1,165
|
$
|
-
|
$
|
-
|
$
|
3,005
|
Six Months Ended February 28, 2014
|
||||||||||||||||||||
Guarantor/
Issuer
Subsidiary
|
Non-guarantor
Subsidiaries
|
Parent
Company
|
Consolidating
Adjustments
|
Consolidated
|
||||||||||||||||
Cash Flows from Operating Activities
|
$ |
471
|
$ |
766
|
$ |
-
|
$ |
-
|
$ |
1,237
|
||||||||||
Cash Flows from Investing Activities
:
|
||||||||||||||||||||
Additions to property, plant and equipment
|
(342
|
)
|
(301
|
)
|
-
|
52
|
(591
|
)
|
||||||||||||
Proceeds from sale of assets
|
201
|
60
|
-
|
(52
|
) |
209
|
||||||||||||||
Proceeds from sale of business
|
- | - |
-
|
- |
-
|
|||||||||||||||
Business and intangible asset acquisitions, net of cash received
|
(254
|
)
|
(43
|
)
|
-
|
-
|
(297
|
)
|
||||||||||||
Purchases of short-term investments held to maturity
|
-
|
(34
|
)
|
-
|
-
|
(34
|
)
|
|||||||||||||
Proceeds from short-term investments held to maturity
|
-
|
34
|
-
|
-
|
34
|
|||||||||||||||
Investment in AmerisourceBergen
|
-
|
(430
|
)
|
-
|
-
|
(430
|
)
|
|||||||||||||
Other
|
-
|
(59
|
)
|
-
|
-
|
(59
|
)
|
|||||||||||||
Net cash used for investing activities
|
(395
|
)
|
(773
|
)
|
-
|
-
|
(1,168
|
)
|
||||||||||||
Cash Flows from Financing Activities
:
|
||||||||||||||||||||
Stock purchases
|
(205
|
)
|
-
|
-
|
-
|
(205
|
)
|
|||||||||||||
Proceeds related to employee stock plans
|
416
|
-
|
-
|
-
|
416
|
|||||||||||||||
Cash dividends paid
|
(597
|
)
|
-
|
-
|
-
|
(597
|
)
|
|||||||||||||
Other
|
(12
|
)
|
-
|
-
|
-
|
(12
|
)
|
|||||||||||||
Net cash (used for) provided by financing activities
|
(398
|
)
|
-
|
-
|
-
|
(398
|
)
|
|||||||||||||
Changes in Cash and Cash Equivalents
:
|
||||||||||||||||||||
Net (decrease) increase in cash and cash equivalents
|
(322
|
)
|
(7
|
)
|
-
|
-
|
(329
|
)
|
||||||||||||
Cash and cash equivalents at beginning of period
|
1,771
|
335
|
-
|
-
|
2,106
|
|||||||||||||||
Cash and cash equivalents at end of period
|
$
|
1,449
|
$
|
328
|
$
|
-
|
$
|
-
|
$
|
1,777
|
· | we have a presence in over 25 countries and are the largest retail pharmacy, health and daily living destination in the U.S. and Europe |
· | we are a global leader in pharmacy-led health and wellbeing retail with more than 13,100 stores in 11 countries |
· | we are one of the largest global pharmaceutical wholesale and distribution networks with more than 350 distribution centers delivering to more than 200,000 pharmacies, doctors, health centers and hospitals each year in 19 countries |
· | we are one of the world's largest purchasers of prescription drugs and other health and wellbeing products |
· | we employ more than 370,000 employees, of which more than 100,000 are healthcare providers. |
· | Retail Pharmacy USA; |
· | Retail Pharmacy International; and |
· | Pharmaceutical Wholesale. |
Country
|
Retail Stores
|
|||
United Kingdom
|
|
2,511
|
||
Mexico
|
1,019
|
|||
Chile
|
444
|
|||
Thailand
|
255
|
|||
Norway
|
157
|
|||
Republic of Ireland
|
80
|
|||
The Netherlands
|
67
|
|||
Lithuania
|
26
|
|||
Total
|
4,559
|
(in millions, except per share amounts)
|
||||||||||||||||
Three Months Ended
|
Six Months Ended
|
|||||||||||||||
February 28,
2015
|
February 28,
2014
|
February 28,
2015
|
February 28,
2014
|
|||||||||||||
Net sales
|
$
|
26,573
|
$
|
19,605
|
$
|
46,127
|
$
|
37,934
|
||||||||
Gross Profit
|
6,882
|
5,650
|
12,178
|
10,802
|
||||||||||||
Selling, general and administrative expenses
|
5,606
|
4,569
|
10,062
|
8,948
|
||||||||||||
Operating Income
|
1,377
|
1,217
|
2,431
|
2,184
|
||||||||||||
Adjusted Operating Income (Non-GAAP measure)
(1)
|
1,840
|
1,408
|
2,958
|
2,472
|
||||||||||||
Earnings Before Interest and Tax Provision
|
2,587
|
1,158
|
3,840
|
2,350
|
||||||||||||
Net Earnings Attributable to Walgreens Boots Alliance, Inc.
|
2,042
|
716
|
2,892
|
1,439
|
||||||||||||
Net Earnings per common share attributable to Walgreens Boots Alliance, Inc. – diluted
|
1.93
|
0.74
|
2.88
|
1.49
|
||||||||||||
Adjusted Net Earnings per common share attributable to Walgreens Boots Alliance, Inc. – diluted (Non-GAAP measure)
(1)
|
1.18
|
0.97
|
1.98
|
1.69
|
Percentage Increases/(Decreases)
|
||||||||||||||||
Three Months Ended
|
Six Months Ended
|
|||||||||||||||
February 28,
2015
|
February 28,
2014
|
February 28,
2015
|
February 28,
2014
|
|||||||||||||
Net sales
|
35.5
|
5.1
|
21.6
|
5.5
|
||||||||||||
Gross Profit
|
21.8
|
0.8
|
12.7
|
0.9
|
||||||||||||
Selling, general and administrative expenses
|
22.7
|
1.6
|
12.4
|
0.6
|
||||||||||||
Operating Income
|
13.1
|
(3.5
|
)
|
11.3
|
6.4
|
|||||||||||
Adjusted Operating Income (Non-GAAP measure)
(1)
|
30.7
|
(1.2
|
)
|
19.7
|
0.0
|
|||||||||||
Earnings Before Interest and Tax Provision
|
123.4
|
(8.2
|
)
|
63.4
|
14.6
|
|||||||||||
Net Earnings Attributable to Walgreens Boots Alliance, Inc.
|
185.2
|
(8.9
|
)
|
101.0
|
14.8
|
|||||||||||
Net Earnings per common share attributable to Walgreens Boots Alliance, Inc. – diluted
|
160.8
|
(9.8
|
)
|
93.3
|
12.9
|
|||||||||||
Adjusted Net Earnings per common share attributable to Walgreens Boots Alliance, Inc. – diluted (Non-GAAP measure)
(1)
|
21.6
|
(1.0
|
)
|
17.2
|
0.0
|
Percent to Net Sales
|
||||||||||||||||
Three Months Ended
|
Six Months Ended
|
|||||||||||||||
February 28,
2015
|
February 28,
2014
|
February 28,
2015
|
February 28,
2014
|
|||||||||||||
Gross Margin
|
25.9
|
28.8
|
26.4
|
28.5
|
||||||||||||
Selling, general and administrative expenses
|
21.1
|
23.3
|
21.8
|
23.6
|
(in millions, except location amounts)
|
||||||||||||||||
Three Months Ended
|
Six Months Ended
|
|||||||||||||||
February 28,
2015
|
February 28,
2014
|
February 28,
2015
|
February 28,
2014
|
|||||||||||||
Total sales
|
$
|
21,048
|
$
|
19,605
|
$
|
40,602
|
$
|
37,934
|
||||||||
Gross Profit
|
5,746
|
5,650
|
11,042
|
10,802
|
||||||||||||
Selling, general and administrative expenses
|
4,555
|
4,569
|
9,011
|
8,948
|
||||||||||||
Operating Income
|
1,292
|
1,217
|
2,346
|
2,184
|
||||||||||||
Adjusted Operating Income (Non-GAAP measure)
(1)
|
1,598
|
1,408
|
2,716
|
2,472
|
||||||||||||
Number of Prescriptions
(2)
|
182
|
175
|
363
|
350
|
||||||||||||
30 Day Equivalent Prescriptions
(2)(3)
|
224
|
214
|
446
|
427
|
||||||||||||
Number of Locations at period end
|
8,333
|
8,681
|
8,333
|
8,681
|
Percentage Increases/(Decreases)
|
||||||||||||||||
Three Months Ended
|
Six Months Ended
|
|||||||||||||||
February 28,
2015
|
February 28,
2014
|
February 28,
2015
|
February 28,
2014
|
|||||||||||||
Total sales
|
7.4
|
5.1
|
7.0
|
5.5
|
||||||||||||
Gross Profit
|
1.7
|
0.8
|
2.2
|
0.9
|
||||||||||||
Selling, general and administrative expenses
|
(0.3
|
)
|
1.6
|
0.7
|
0.6
|
|||||||||||
Operating Income
|
6.2
|
(3.5
|
)
|
7.4
|
6.4
|
|||||||||||
Adjusted Operating Income (Non-GAAP measure)
(1)
|
13.5
|
(1.2
|
)
|
9.9
|
0.0
|
|||||||||||
Comparable Drugstore Sales
|
6.9
|
4.3
|
6.3
|
4.8
|
||||||||||||
Pharmacy Sales
|
10.1
|
7.0
|
9.5
|
7.2
|
||||||||||||
Comparable Pharmacy Sales
|
9.7
|
5.8
|
8.9
|
6.5
|
||||||||||||
Retail Sales
|
2.8
|
2.2
|
2.6
|
2.7
|
||||||||||||
Comparable Retail Sales
|
2.5
|
2.0
|
2.0
|
2.2
|
||||||||||||
Comparable Number of Prescriptions
(2)
|
4.2
|
(0.4
|
)
|
3.5
|
1.4
|
|||||||||||
Comparable 30 Day Equivalent Prescriptions
(2)(3)
|
5.0
|
2.2
|
4.6
|
3.8
|
Percent to Net Sales
|
||||||||||||||||
Three Months Ended
|
Six Months Ended
|
|||||||||||||||
February 28,
2015
|
February 28,
2014
|
February 28,
2015
|
February 28,
2014
|
|||||||||||||
Gross Margin
|
27.3
|
28.8
|
27.2
|
28.5
|
||||||||||||
Selling, general and administrative expenses
|
21.6
|
23.3
|
22.2
|
23.6
|
(1) | See "--Non-GAAP Measures" below for a reconciliation to the most directly comparable GAAP measure and related disclosures. |
(2) | Includes immunizations. |
(3) | Includes the adjustment to convert prescriptions greater than 84 days to the equivalent of three 30-day prescriptions. This adjustment reflects the fact that these prescriptions include approximately three times the amount of product days supplied compared to a normal prescription. |
(in millions)
|
||||||||||
Three Months Ended
|
Six Months Ended
|
|||||||||
February 28,
2015
|
February 28,
2014
|
February 28,
2015
|
February 28,
2014
|
|||||||
Total sales
|
$
|
2,047
|
NA
|
$
|
2,047
|
NA
|
||||
Gross Profit
|
753
|
NA
|
753
|
NA
|
||||||
Selling, general and administrative expenses
|
745
|
NA
|
745
|
NA
|
||||||
Operating Income
|
8
|
NA
|
8
|
NA
|
||||||
Adjusted Operating Income (Non-GAAP measure)
(1)
|
125
|
NA
|
125
|
NA
|
Percent to Net Sales
|
||||||||||
Three Months Ended
|
Six Months Ended
|
|||||||||
February 28,
2015
|
February 28,
2014
|
February 28,
2015
|
February 28,
2014
|
|||||||
Gross Margin
|
36.8
|
NA
|
36.8
|
NA
|
||||||
Selling, general and administrative expenses
|
36.4
|
NA
|
36.4
|
NA
|
NA | Not applicable |
(1) | See "--Non-GAAP Measures" below for reconciliations to the most directly comparable GAAP measure and related disclosures. |
(in millions)
|
||||||||||
Three Months Ended
|
Six Months Ended
|
|||||||||
February 28,
2015
|
February 28,
2014
|
February 28,
2015
|
February 28,
2014
|
|||||||
Total sales
|
$
|
3,865
|
NA
|
$
|
3,865
|
NA
|
||||
Gross Profit
|
387
|
NA
|
387
|
NA
|
||||||
Selling, general and administrative expenses
|
306
|
NA
|
306
|
NA
|
||||||
Operating Income
|
81
|
NA
|
81
|
NA
|
||||||
Adjusted Operating Income (Non-GAAP measure)
(1)
|
121
|
NA
|
121
|
NA
|
Percent to Net Sales
|
||||||||||
Three Months Ended
|
Six Months Ended
|
|||||||||
February 28,
2015
|
February 28,
2014
|
February 28,
2015
|
February 28,
2014
|
|||||||
Gross Margin
|
10.0
|
NA
|
10.0
|
NA
|
||||||
Selling, general and administrative expenses
|
7.9
|
NA
|
7.9
|
NA
|
NA | Not applicable |
(1) | See "--Non-GAAP Measures" below for reconciliations to the most directly comparable GAAP measure and related disclosures. |
(in millions)
|
||||||||||||||||||||
Three months ended February 28, 2015
|
||||||||||||||||||||
Retail
Pharmacy
USA
|
Retail Pharmacy International
|
Pharmaceutical
Wholesale
|
Eliminations
and Other
|
Walgreens
Boots Alliance,
Inc.
|
||||||||||||||||
Operating Income (GAAP)
|
$
|
1,292
|
$
|
8
|
$
|
81
|
$
|
(4
|
)
|
$
|
1,377
|
|||||||||
Asset impairment
|
110
|
-
|
-
|
-
|
110
|
|||||||||||||||
Acquisition-related amortization
(1)
|
67
|
117
|
33
|
-
|
217
|
|||||||||||||||
LIFO provision
|
55
|
-
|
-
|
-
|
55
|
|||||||||||||||
Acquisition-related costs
|
52
|
-
|
7
|
-
|
59
|
|||||||||||||||
Optimization costs
|
16
|
-
|
-
|
-
|
16
|
|||||||||||||||
Decrease in fair market value of warrants
|
6
|
-
|
-
|
-
|
6
|
|||||||||||||||
Adjusted Operating Income (Non-GAAP measure)
|
$
|
1,598
|
$
|
125
|
$
|
121
|
$
|
(4
|
)
|
$
|
1,840
|
(1) | Includes $106 million (Retail Pharmacy International $100 million and Pharmaceutical Wholesale $6 million) of inventory fair value step-up amortization. No additional amortization related to the inventory step-up is expected in future quarters. |
(in millions)
|
||||||||||||||||||||
Six months ended February 28, 2015
|
||||||||||||||||||||
Retail
Pharmacy
USA
|
Retail Pharmacy International
|
Pharmaceutical
Wholesale
|
Eliminations
and Other
|
Walgreens
Boots Alliance, Inc.
|
||||||||||||||||
Operating Income (GAAP)
|
$
|
2,346
|
$
|
8
|
$
|
81
|
$
|
(4
|
)
|
$
|
2,431
|
|||||||||
Asset impairment
|
110
|
-
|
-
|
110
|
||||||||||||||||
Acquisition-related amortization
(1)
|
156
|
117
|
33
|
-
|
306
|
|||||||||||||||
LIFO provision
|
107
|
-
|
-
|
-
|
107
|
|||||||||||||||
Acquisition-related costs
|
76
|
-
|
7
|
-
|
83
|
|||||||||||||||
Optimization costs
|
44
|
-
|
-
|
-
|
44
|
|||||||||||||||
Increase in fair market value of warrants
|
(123
|
)
|
-
|
-
|
-
|
(123
|
)
|
|||||||||||||
Adjusted Operating Income (Non-GAAP measure)
|
$
|
2,716
|
$
|
125
|
$
|
121
|
$
|
(4
|
)
|
$
|
2,958
|
(1) | Includes $106 million (Retail Pharmacy International $100 million and Pharmaceutical Wholesale $6 million) of inventory fair value step-up amortization. No additional amortization related to the inventory step-up is expected in future quarters. |
(in millions)
|
||||||||||||||||||||
Six months ended February 28, 2014
|
||||||||||||||||||||
Retail
Pharmacy
USA
|
Retail Pharmacy International
|
Pharmaceutical
Wholesale
|
Eliminations
and Other
|
Walgreens
Boots Alliance, Inc.
|
||||||||||||||||
Operating Income (GAAP)
|
$
|
2,184
|
$
|
-
|
$
|
-
|
$
|
-
|
$
|
2,184
|
||||||||||
Acquisition-related amortization
|
183
|
-
|
-
|
-
|
183
|
|||||||||||||||
LIFO provision
|
109
|
-
|
-
|
-
|
109
|
|||||||||||||||
Acquisition-related costs
|
42
|
-
|
-
|
-
|
42
|
|||||||||||||||
Optimization costs
|
26
|
-
|
-
|
-
|
26
|
|||||||||||||||
Increase in fair market value of warrants
|
(72
|
)
|
-
|
-
|
-
|
(72
|
)
|
|||||||||||||
Adjusted Operating Income (Non-GAAP measure)
|
$
|
2,472
|
$
|
-
|
$
|
-
|
$
|
-
|
$
|
2,472
|
Three Months Ended
|
Six Months Ended
|
|||||||||||||||
February 28,
2015
|
February 28,
2014
|
February 28,
2015
|
February 28,
2014
|
|||||||||||||
Net earnings per common share attributable to Walgreens Boots Alliance, Inc. – diluted (GAAP)
|
$
|
1.93
|
$
|
0.74
|
$
|
2.88
|
$
|
1.49
|
||||||||
Gain on previously held equity interest
|
(0.77
|
)
|
-
|
(0.81
|
)
|
-
|
||||||||||
Transaction foreign currency hedging loss
|
0.07
|
-
|
0.16
|
-
|
||||||||||||
Acquisition-related amortization
|
0.15
|
0.06
|
0.21
|
0.12
|
||||||||||||
Asset impairment
|
0.07
|
-
|
0.08
|
-
|
||||||||||||
LIFO provision
|
0.04
|
0.04
|
0.08
|
0.08
|
||||||||||||
Alliance Boots equity method non-cash tax
|
0.04
|
0.06
|
0.07
|
0.10
|
||||||||||||
Acquisition-related costs
|
0.04
|
0.01
|
0.06
|
0.03
|
||||||||||||
Optimization costs
|
0.01
|
-
|
0.03
|
0.02
|
||||||||||||
Prefunded interest expense
|
0.02
|
-
|
0.03
|
-
|
||||||||||||
(Increase)/decrease in fair market value of warrants
|
(0.35
|
)
|
0.06
|
(0.65
|
)
|
(0.15
|
)
|
|||||||||
Partial release of capital loss valuation allowance
|
-
|
-
|
(0.09
|
)
|
-
|
|||||||||||
Adjusted tax rate true-up
|
(0.07
|
)
|
-
|
(0.07
|
)
|
-
|
||||||||||
Adjusted net earnings per common share attributable to Walgreens Boots Alliance, Inc. – diluted (Non-GAAP measure)
|
$
|
1.18
|
$
|
0.97
|
$
|
1.98
|
$
|
1.69
|
For the six months ended February 28,
|
||||||||
2015
|
2014
|
|||||||
Retail Pharmacy USA
|
$
|
550
|
$
|
591
|
||||
Retail Pharmacy International
(1)
|
82
|
-
|
||||||
Pharmaceutical Wholesale
(1)
|
11
|
-
|
||||||
Total
|
$
|
643
|
$
|
591
|
Rating Agency
|
Long-Term Debt Rating
|
Commercial Paper Rating
|
Outlook
|
Moody's
|
Baa2
|
P-2
|
Stable
|
Standard & Poor's
|
BBB
|
A-2
|
Stable
|
· | compliance with a wide variety of foreign laws and regulations, including retail and wholesale pharmacy, licensing, tax, foreign trade, intellectual property, privacy and data protection, currency, political and other business restrictions and requirements and local laws and regulations, whose interpretation and enforcement vary significantly among jurisdictions and can change significantly over time; |
· | additional U.S. and other regulation of non-domestic operations, including regulation under the Foreign Corrupt Practices Act, the U.K. Bribery Act and other anti-corruption laws; |
· | potential difficulties in managing foreign operations, enforcing agreements and collecting receivables through foreign legal systems; |
· | price controls imposed by foreign countries; |
· | tariffs, duties or other restrictions on foreign currencies or trade barriers imposed by foreign countries; |
· | potential adverse tax consequences, including tax withholding laws and policies and restrictions on repatriation of funds to the United States; |
· | fluctuations in currency exchange rates, including uncertainty regarding the Euro; |
· | impact of recessions and economic slowdowns in economies outside the United States, including foreign currency devaluation, higher interest rates, inflation, and increased government regulation or ownership of traditional private businesses; |
· | the instability of foreign economies, governments and currencies and unexpected regulatory, economic or political changes in foreign markets; and |
· | developing and emerging markets may be especially vulnerable to periods of instability and unexpected changes, and consumers in those markets may have relatively limited resources to spend on products and services. |
· | requiring us to dedicate significant cash flow from operations to the payment of principal, interest and other amounts payable on our debt, which would reduce the funds we have available for other purposes, such as working capital, capital expenditures, acquisitions, share repurchases and dividends; |
· | making it more difficult or expensive for us to obtain any necessary future financing for working capital, capital expenditures, debt service requirements, debt refinancing, acquisitions or other purposes; |
· | reducing our flexibility in planning for or reacting to changes in our industry and market conditions; |
· | making us more vulnerable in the event of a downturn in our business operations; and |
· | exposing us to interest rate risk given that a portion of our debt obligations is at variable interest rates. |
· | actual or anticipated variations in quarterly operating results and the results of competitors; |
· | changes in financial estimates by Walgreens Boots Alliance or by any securities analysts that might cover Walgreens Boots Alliance; |
· | conditions or trends in the industry, including regulatory changes or changes in the securities marketplace; |
· | announcements by us or our competitors of significant acquisitions, strategic partnerships or divestitures; |
· | announcements of investigations or regulatory scrutiny of our operations or lawsuits filed against us; |
· | additions or departures of key personnel; and |
· | issuances or sales of Walgreens Boots Alliance common stock, including sales of shares by its directors and officers or its key investors, including the SP Investors and/or the KKR Investors. |
· | If we are unsuccessful in establishing effective advertising, marketing and promotional programs, our sales or sales margins could be negatively affected. |
· | Our operating costs may be subject to increases outside the control of our businesses, whether due to inflation, new or increased taxes, adverse fluctuations in foreign currency exchange rates, changes in market conditions or otherwise. |
· | Our success depends on our continued ability to attract and retain store and management and professional personnel, and the loss of key personnel could have an adverse effect on the results of our operations, financial condition or cash flow. |
· | Natural disasters, severe weather conditions, terrorist activities, global political and economic developments, war, health epidemics or pandemics or the prospect of these events can impact our operations or damage our facilities in affected areas or have an adverse impact on consumer confidence levels and spending in our stores. |
· | The long-term effects of climate change on general economic conditions and the pharmacy industry in particular are unclear, and changes in the supply, demand or available sources of energy and the regulatory and other costs associated with energy production and delivery may affect the availability or cost of goods and services, including natural resources, necessary to run our businesses. |
· | The products we sell are sourced from a wide variety of domestic and international vendors, and any future inability to find qualified vendors and access products in a timely and efficient manner could adversely impact our businesses. |
(c) | The following table provides information about purchases by the Company during the quarter ended February 28, 2015 of equity securities that are registered by the Company pursuant to Section 12 of the Exchange Act. Subject to applicable law, share purchases may be made in open market transactions, privately negotiated transactions, or pursuant to instruments and plans complying with Rule 10b5-1. |
Issuer Purchases of Equity Securities
|
||||||||||||||||
Period
|
Total
Number of
Shares
Purchased
|
Average
Price Paid
per Share
|
Total Number of Shares
Purchased as Part of Publicly
Announced Repurchase
Programs (1)
|
Approximate Dollar Value of
Shares That May Yet be
Purchased Under the Plans or
Program (1)
|
||||||||||||
12/1/14 - 12/31/14
|
-
|
-
|
-
|
$
|
3,000,000,000
|
|||||||||||
1/1/15 - 1/31/15
|
-
|
-
|
-
|
3,000,000,000
|
||||||||||||
2/1/15 – 2/28/15
|
1,193,841
|
$
|
79.15
|
1,193,841
|
2,905,507,325
|
|||||||||||
Total
|
1,193,841
|
$
|
79.15
|
1,193,841
|
$
|
2,905,507,325
|
(1) | In August 2014, the Board of Directors approved the 2014 share repurchase program which allows for the purchase of up to $3.0 billion of the Company's common stock prior to its expiration on August 31, 2016. |
• | should not in all instances be treated as categorical statements of fact, but rather as a way of allocating the risk to one of the parties if those statements prove to be inaccurate; |
•
|
may have been qualified by disclosures that were made to the other party in connection with the negotiation of the applicable agreement, which disclosures are not necessarily reflected in the agreement;
|
•
|
may apply standards of materiality in a way that is different from what may be viewed as material to you or other investors; and
|
•
|
were made only as of the date of the applicable agreement or such other date or dates as may be specified in the agreement and are subject to more recent developments.
|
Exhibit
No.
|
Description
|
SEC Document Reference
|
|
2.1
|
Amendment No. 1, dated December 23, 2014, to the Reorganization Agreement and Plan of Merger, dated October 17, 2014, by and among Walgreen Co., Walgreens Boots Alliance, Inc. and Ontario Merger Sub, Inc.
|
Incorporated by reference to Exhibit 2.1 to Walgreens Boots Alliance, Inc.'s Current Report on Form 8-K (File No. 001-36759) filed with the SEC on December 24, 2014.
|
|
2.2
|
Amendment No. 2, dated December 29, 2014, to the Reorganization Agreement and Plan of Merger, dated October 17, 2014, as amended December 23, 2014, by and among Walgreen Co., Walgreens Boots Alliance, Inc. and Ontario Merger Sub, Inc.
|
Incorporated by reference to Exhibit 2.3 to Walgreens Boots Alliance, Inc.'s Quarterly Report on Form 10-Q for the quarter ended November 30, 2014 (File No. 001-36759) filed with the SEC on December 30, 2014.
|
|
3.1
|
Amended and Restated Certificate of Incorporation of Walgreens Boots Alliance, Inc.
|
Incorporated by reference to Exhibit 3.1 to Walgreens Boots Alliance, Inc.'s Current Report on Form 8-K-12B (File No. 001-36759) filed with the SEC on December 31, 2014.
|
3.2
|
Amended and Restated Bylaws of Walgreens Boots Alliance, Inc.
|
Incorporated by reference to Exhibit 3.2 to Walgreens Boots Alliance, Inc.'s Current Report on Form 8-K12B (File No. 001-36759) filed with the SEC on December 31, 2014.
|
|
4.1
|
Form of Guarantee of Walgreens Boots Alliance, Inc.
|
Incorporated by reference to Exhibit 4.1 to Walgreens Boots Alliance, Inc.'s Current Report on Form 8-K12B (File No. 001-36759) filed with the SEC on December 31, 2014.
|
|
10.1*
|
Walgreens Boots Alliance, Inc. 2013 Omnibus Incentive Plan (as amended and restated effective December 31, 2014).
|
Incorporated by reference to Exhibit 10.1 to Walgreens Boots Alliance, Inc.'s Current Report on Form 8-K12B (File No. 001-36759) filed with the SEC on December 31, 2014.
|
|
10.2*
|
Form of Restricted Stock Unit Award agreement (effective January 2015).
|
Incorporated by reference to Exhibit 10.1 to Walgreens Boots Alliance, Inc.'s Current Report on Form 8-K (File No. 001-36759) filed with the SEC on January 21, 2015.
|
|
10.3*
|
Form of Performance Share Award agreement (effective January 2015).
|
Incorporated by reference to Exhibit 10.2 to Walgreens Boots Alliance, Inc.'s Current Report on Form 8-K (File No. 001-36759) filed with the SEC on January 21, 2015.
|
|
10.4*
|
Form of Stock Option Award agreement (effective January 2015).
|
Incorporated by reference to Exhibit 10.3 to Walgreens Boots Alliance, Inc.'s Current Report on Form 8-K (File No. 001-36759) filed with the SEC on January 21, 2015.
|
|
10.5*
|
Form of Restricted Stock Unit Agreement, as amended (Special Transition Awards).
|
Incorporated by reference to Exhibit 10.2 to Walgreen Co.'s Current Report on Form 8-K (File No. 1-00604) filed with the SEC on December 24, 2014.
|
|
Form of Restricted Stock Unit Agreement (Messrs. Skinner and Pessina).
|
Filed herewith.
|
||
10.7*
|
Walgreens Boots Alliance, Inc. Executive Deferred Profit-Sharing Plan (as amended and restated effective December 31, 2014).
|
Incorporated by reference to Exhibit 10.3 to Walgreens Boots Alliance, Inc.'s Current Report on Form 8-K12B (File No. 001-36759) filed with the SEC on December 31, 2014.
|
|
10.8*
|
Walgreens Boots Alliance, Inc. Executive Severance and Change in Control Plan (as amended and restated effective December 31, 2014).
|
Incorporated by reference to Exhibit 10.4 to Walgreens Boots Alliance, Inc.'s Current Report on Form 8-K12B (File No. 001-36759) filed with the SEC on December 31, 2014.
|
|
10.9*
|
Walgreens Boots Alliance, Inc. 2011 Cash-Based Incentive Plan (as amended and restated effective December 31, 2014).
|
Incorporated by reference to Exhibit 10.5 to Walgreens Boots Alliance, Inc.'s Current Report on Form 8-K12B (File No. 001-36759) filed with the SEC on December 31, 2014.
|
|
10.10*
|
Walgreens Boots Alliance, Inc. Management Incentive Plan (as amended and restated effective December 31, 2014).
|
Incorporated by reference to Exhibit 10.6 to Walgreens Boots Alliance, Inc.'s Current Report on Form 8-K12B (File No. 001-36759) filed with the SEC on December 31, 2014.
|
|
Rules of the Alliance Boots 2012 Long Term Incentive Plan, as amended.
|
Filed herewith.
|
||
Form of Award Agreement for Alliance Boots 2012 Long Term Incentive Plan.
|
Filed herewith.
|
10.29* |
Offer Letter agreement between Stefano Pessina and Walgreens Boots Alliance, Inc.
|
Filed herewith.
|
|
10.30
|
Revolving Credit Agreement, dated as of December 19, 2014, among Walgreen Co., Walgreens Boots Alliance, Inc., the lenders from time to time party thereto and Mizuho Bank, Ltd., as administrative agent.
|
Incorporated by reference to Exhibit 10.1 to Walgreens Boots Alliance, Inc.'s Current Report on Form 8-K (File No. 001-36759) filed with the SEC on December 24, 2014.
|
|
Computation of Ratio of Earnings to Fixed Charges.
|
Filed herewith.
|
||
Letter from Independent Registered Public Accounting Firm Regarding Change in Accounting Principle.
|
Filed herewith.
|
||
Certification of the Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
|
Filed herewith.
|
||
Certification of the Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
|
Filed herewith.
|
||
Certification of the Chief Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, 18 U.S.C. Section 1350.
|
Furnished herewith.
|
||
Certification of the Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, 18 U.S.C. Section 1350.
|
Furnished herewith.
|
||
101.INS
|
XBRL Instance Document.
|
Filed herewith.
|
|
101.SCH
|
XBRL Taxonomy Extension Schema Document.
|
Filed herewith.
|
|
101.CAL
|
XBRL Taxonomy Extension Calculation Linkbase Document.
|
Filed herewith.
|
|
101.DEF
|
XBRL Taxonomy Extension Definition Linkbase Document.
|
Filed herewith.
|
|
101.LAB
|
XBRL Taxonomy Extension Label Linkbase Document.
|
Filed herewith.
|
|
101.PRE
|
XBRL Taxonomy Extension Presentation Linkbase Document.
|
Filed herewith.
|
*
|
Management contract or compensatory plan or arrangement.
|
Walgreens Boots Alliance, Inc.
|
|
(Registrant)
|
|
Dated : April 9, 2015
|
/s/ George Fairweather
|
George Fairweather
|
|
Executive Vice President and Global Chief Financial Officer
|
|
(Chief Financial and Principal Accounting Officer)
|
Clause
|
Page
|
|
1.
|
Definitions and interpretation
|
1
|
2.
|
Grant of Awards
|
1
|
3.
|
Conditions
|
2
|
4.
|
Vesting of Awards
|
3
|
5.
|
Lapse of Awards
|
6
|
6.
|
Consequences of Vesting
|
7
|
7.
|
Adjustment of Awards
|
8
|
8.
|
Administration
|
8
|
9.
|
Amendment
|
9
|
10.
|
General
|
10
|
11.
|
Governing Law
|
12
|
1.
|
Definitions
|
13
|
2.
|
Phantom Awards
|
17
|
1. | DEFINITIONS AND INTERPRETATION |
1.1 | Definitions |
1.2 | Interpretation |
2. | GRANT OF AWARDS |
2.1 | Operation of the Plan |
(a) | the Eligible Employees who may be granted Awards; |
(b) | the value, at its Date of Grant, of an Eligible Employee's Award; |
(c) | what performance condition(s) (if any) will apply to the vesting of an Award or Part of an Award and how the performance condition(s) will be measured; and |
(d) | how Awards are granted. |
2.2 | Eligible Employees |
2.3 | Grant of Awards |
(i) | which Eligible Employees will be granted Awards under the Plan; and |
(ii) | the value of an Award at its Date of Grant. |
2.4 | When Awards can be granted |
2.5 | Approvals and consents |
2.6 | Notification of grant |
2.7 | Awards personal to Participants |
2.8 | Disclaimer of Awards |
3. | CONDITIONS |
3.1 | General |
(a) | must be stated in writing either at the Date of Grant or any later date determined by the Board; |
(b) | may be amended or substituted if one or more events occur which cause the Board to consider that an amended or substituted condition would be more appropriate; and |
(c) | may be waived if anything happens which causes the Board reasonably to consider that it should be waived. |
3.2 | Group Target |
(a) | the start of any year in the Performance Period the Board will determine the TP Target for that year; and |
(b) | the end of the any year (or other period) in the Performance Period the Remuneration Committee will determine whether the TP Target for that year (or other period) has been met and whether that element of the Group Target Part of an Award allocated to that year (or other period) will vest on the Normal Vesting Date. |
3.3 | Synergy Target |
(a) | the start of any year in the Performance Period the Board will determine the Synergy Target for that year; and |
(b) | the end of any year (or other period) in the Performance Period the Board will determine whether the Synergy Target for that year (or other period) has been met and whether that element of the Synergy Target Part of an Award allocated to that year (or other period) will vest on the Normal Vesting Date. |
3.4 | Share Part |
(a) | if the Participant remains in Employment on the date of the Second Step Acquisition; or |
(b) | pursuant to Rule 4.5 (Death). |
3.5 | No Re-testing |
4. | VESTING OF AWARDS |
4.1 | Normal rule for vesting |
(a) | in respect of the Group Target Part and the Synergy Target Part on the earlier of: |
(i) | its Normal Vesting Date; and |
(ii)
|
the day immediately before the date of the Second Step Acquisition; and
|
(b) | in respect of the Share Part only on the day immediately before the date of the Second Step Acquisition, |
4.2 | Vesting following ceasing to be in Employment (Good Leaver) |
(a) | disability, ill health or injury; |
(b) | Retirement; |
(c) | Redundancy; |
(d) | the company which employs the Participant ceasing to be a Group Company; |
(e) | the transfer or sale of the undertaking or part-undertaking in which the Participant is employed to a person who is not a Group Company; or |
(f) | any other circumstances determined by the Board, |
4.3 | Cessation of Employment in other circumstances |
4.4 | Pregnancy |
4.5 | Death |
4.6 | Corporate transactions |
(a) | Takeover : on which an offeror (together with others, if any, acting in concert with the offeror) obtains Control of the Company as a result of (i) making a general offer to acquire all of the issued ordinary shares of the Company or all of the shares of the Company which are of the same class as the Shares and which, in either case, are not at the time owned by the offeror or any company Controlled by the offeror and/or persons acting in concert with the offeror; or (ii) obtaining Control of the Parent or ultimate holding company of the Company as a result of making a general offer to acquire all of the issued ordinary shares of the relevant company; |
(b) | Section 979 notice : a person first becomes bound or entitled to acquire Shares under sections 979 to 982 of the Companies Act 2006, or would be so entitled but for the fact that there were no dissenting shareholders; and |
(c) | Compromise or arrangement under section 899 : when the court sanctions a compromise or arrangement between the Company and its shareholders under section 899 of the Companies Act 2006. |
4.7 | Reorganisation |
4.8 | Winding up |
(a) | immediately before the passing of a resolution for the voluntary winding-up of the Company; or |
(b) | on the Court making an order for the winding-up of the Company. |
4.9 | Conditions |
4.10 | Pro rata reduction |
4.11 | Reduction of number of Shares subject to an Award |
(a) | if the Board exercises this discretion, the Award will be deemed to have been granted over the lower cash amount and/or number of Shares and the vesting of the Award in accordance with the Rules will be by reference to this reduced cash amount and number of Shares; and |
(b) | the discretion under this Rule 4.11 will only be capable of exercise by the Board if there has been no change of Control of the Company. However, if, as a result of any change of Control, the Company has a new holding company which immediately after the change of Control has substantially the same shareholders and proportionate shareholdings as the Company did before, the discretion under this Rule 4.11 will be capable of exercise by the remuneration committee of the board of directors of the new holding company. |
5. | LAPSE OF AWARDS |
5.1 | Lapse of Awards |
(a) | the date on which a Participant ceases to be in Employment in any circumstances other than those referred to in Rules 4.2 and Rule 4.5; |
(b) | the Participant being deprived of the legal or beneficial ownership of the Award by operation of law, or doing or omitting to do anything which causes him to be so deprived or being declared bankrupt; or |
(c) | the Participant breaching or attempting to breach Rule 2.7. |
5.2 | Lapse where no or partial vesting |
6. | CONSEQUENCES OF VESTING |
6.1 | Consequences of vesting of Awards |
6.2 | Vesting of Group Target Part and Synergy Target Part following the Second Step Acquisition |
6.3 | Delivery of net number of Shares |
(a) | the grant of the Award to be unlawful or for it to fall outside any applicable securities law exemption; or |
(b) | adverse tax consequences for the Participant and/or any Group Company. |
6.4 | Satisfaction of Share Part in cash |
6.5 | Consents |
6.6 | Ranking of Shares |
7. | ADJUSTMENT OF AWARDS |
7.1 | Variation in shares |
7.2 | Notifying Participants |
8. | ADMINISTRATION |
8.1 | Administration of the Plan |
8.2 | Costs |
8.3 | Shares to cover Awards |
8.4 | Notices |
(a) | by personal delivery; or |
(b) | by sending it by post: |
(i) | in the case of a company, to its registered office or other address that it notifies in writing; and |
(ii) | in the case of an individual, to the individual's last known address or, where the individual is a director or employee of a Group Company, either to the individual's last known address or to the address of the place of business at which the individual performs the whole or substantially the whole of the duties of the individual's office or employment; or |
(c) | by sending it by email or any form of electronic transfer acceptable to the Board: |
(i) | in the case of a company, to the email address or other number or address that the company notifies; and |
(ii) | in the case of an individual, to the individual's last known email address or, where the individual is a director or employee of a Group Company, to the individual's workplace email address. |
8.5 | Time of service of notice |
(a) | if delivered, at the time of delivery; |
(b) | if posted, at 10.00am on the second business day after it was put into the post; or |
(c) | if sent by email or any other form of electronic transfer, at the time of despatch. |
8.6 | Local currency equivalent |
9. | AMENDMENT |
9.1 | Board's power to amend the Plan |
9.2 | Participants' approval |
(a) | with the written consent of Participants who hold Awards under the Plan to acquire 75 per cent. of the Shares which would be delivered if all of the Awards granted and subsisting under the Plan vested; or |
(b) | by a resolution of a meeting of Participants passed by not less than 75 per cent. of the Participants who attend and vote either in person or by proxy, |
9.3 | Permitted amendments |
(a) | minor and to benefit the administration of the Plan; |
(b) | to take account of any changes in legislation; or |
(c) | to obtain or maintain favourable tax, exchange control or regulatory treatment for the Company, any Group Company or any present or future Participant. |
9.4 | Overseas Eligible Employees |
9.5 | Notice of amendments |
10. | GENERAL |
10.1 | Termination of the Plan |
10.2 | Funding the Plan |
10.3 | Rights of Participants and Eligible Employees |
10.4 | No rights to compensation or damages |
10.5 | The benefits of Rules 10.3 and 10.4 |
10.6 | Share Rights |
10.7 | Withholding for tax and social security contributions |
10.8 | Severability |
10.9 | Third parties |
10.10 | Data protection |
10.11
|
Value of benefit
|
11. | GOVERNING LAW |
Appendix 1
|
this Appendix 1 which forms part of the Rules;
|
Award
|
an award will be comprised of three parts, being the rights to receive:
(a)
a cash amount based on the achievement of performance relating to the Group excluding synergies, which will comprise approximately 50 per cent. of the value of the Award at its Date of Grant (the
Group Target Part
);
(b)
a cash amount based on the achievement of synergy targets, which will comprise approximately 25 per cent. of the value of the Award at its Date of Grant (the
Synergy Target Part
); and
(c)
a number of Shares based on continued employment with the Group to the date of the Merger, which will comprise approximately 25 per cent. of the value of the Award at its Date of Grant (the
Share Part
),
and
Part of an/the Award
will be construed accordingly;
|
Board
|
the board of directors of Alliance Boots International Limited, registered in England and Wales under no. 6166738 or a duly authorised committee of that board;
|
Company
|
AB Acquisitions UK Topco Limited, registered in England and Wales under no. 06166727;
|
Control
|
in relation to a body corporate, the power of a person to secure:
(a)
by means of the holding of shares or the possession of voting power in or in relation to that or any other body corporate; or
(b)
by virtue of any power conferred by the articles of association or other document regulating that or any other body corporate,
that the affairs of the first-mentioned body corporate are conducted in accordance with the wishes of that person, and
Controlled
will be construed accordingly;
|
Date of Grant
|
with respect to an Award, the date on which it is granted under Rule 2;
|
Dealing Day
|
any day on which the New York Stock Exchange is open for the transaction of business;
|
Eligible Employee
|
any person who, at the Date of Grant, is an employee of a Group Company;
|
Employment
|
employment as an employee of a Group Company;
|
Group Company
|
the Parent, and any company which is either a subsidiary undertaking of the Parent or an associate of the Parent (where
subsidiary undertaking
has the meaning given in section1162 of the Companies Act 2006 and
associate
is as defined in International Accounting Standard 28
Investments in Associates and joint ventures (as amended)
);
|
Group Target Part
|
has the meaning given in the definition of Award;
|
Market Value
|
in relation to a Share on any day means an amount equal to its middle market quotation as derived from the New York Stock Exchange;
|
Second Step Acquisition
|
the date of completion of the Second Step Acquisition as defined in the Purchase and Option Agreement by and among Alliance Boots GmbH, AB Acquisitions Holdings Limited and Walgreen Co dated 18 June 2012. If the Second Step Acquisition does not constitute a Change in Control for the purposes of section 409A of the US Code, all US Awards will vest as otherwise provided in these Rules, but will be payable only with respect to the Normal Vesting Date;
|
Normal Vesting Date
|
with respect to an Award means the date when the Remuneration Committee or the Board, as appropriate, determines whether the conditions applicable to the Group Target Part and the Synergy Target Part have been met for the last Financial Year of the Performance Period of the Award;
|
Parent
|
Alliance Boots GmbH;
|
Participant
|
an individual who has been granted an Award including, if relevant, the Participant's personal representatives;
|
Participating Company
|
a Group Company whose Eligible Employee(s) have been granted or are proposed to be granted (an) Award(s);
|
Performance Period
|
with respect to an Award the period of consecutive years (or other periods) for which the Award is expressed to be granted;
|
Phantom Award
|
an Award granted pursuant to Appendix 2;
|
Plan
|
the Alliance Boots 2012 Long Term Incentive, as amended from time to time in accordance with the Rules;
|
Plan Period
|
the period starting on 1August 2012 and ending on the tenth anniversary of that date;
|
Redundancy
|
the termination of a Participant's Employment attributable wholly or mainly to the fact that:
(a)
the employer has ceased or intends to cease:
(i)
to carry on the business for the purpose of which the employee was employed; or
(ii)
to carry out that business in the place the employee was employed; or
(b)
the requirements of that business:
(i)
for employees to carry out work of a particular kind; or
(ii)
to carry out that work in the place where the employee was employed,
have ceased or diminished or are expected to cease or diminish;
|
Remuneration Committee
|
the remuneration committee of the board of directors of Alliance Boots GmbH;
|
Retirement
|
retirement with the agreement of the Participant's employing company;
|
Rules
|
the rules of the Plan as amended from time to time;
|
Share
|
a fully paid ordinary share in the capital of Walgreens;
|
Share Part
|
has the meaning given in the definition of Award;
|
Synergy Target Plan
|
has the meaning given in the definition of Award;
|
Trustees
|
the trustee or trustees of any employee benefit trust which operates in conjunction with the Plan;
|
US Award
|
the portion of any Award that is subject to US income tax and not otherwise exempt from section 409A;
|
US Code
|
the United States Internal Revenue Code of 1986, as amended;
|
Variation
|
in relation to the equity share capital of Walgreens, a capitalisation issue, an offer or invitation made by way of rights, a subdivision, consolidation, reduction, demerger, or distribution in specie or any other variation in its share capital; and
|
Walgreens
|
Walgreen Co.
|
1. | The Rules shall apply to the grant of Awards under this Appendix 2, except as specified in this Appendix 2. |
2. | The following Rules shall be deleted: |
2.1 | Rule 6.3. |
2.2 | Rule 6.4. |
2.3 | Rule 6.6. |
2.4 | Rule 8.3. |
2.5 | Rule 9.4. |
2.6 | Rule 10.2. |
2.7 | Rule 10.6 |
3. | Rule 6.1 will be deleted and replaced by the following: |
4. | Rule 6.5 will be deleted and replaced by the following: |
5. | Rule 8.2 will be deleted and replaced by the following: |
6. | Rule 10.7 will be deleted and replaced with the following: |
7. | In Appendix I (Definitions) the following will apply: |
· | the Group Target Part which is a cash award and has a maximum value of £X ; |
· | the Synergy Target Part, which is a cash award and has a maximum value of £X ; and |
· | the Share Part which is an award of X Walgreen shares. |
Performance Periods
|
% of Group Target Part vesting
if TP Target achieved
|
1 April 2012 to 31 March 2013
|
22.3%
|
1 April 2013 to 31 March 2014
|
33.3%
|
1 April 2014 to 31 March 2015
|
33.3%
|
1 April 2015 to 31 July 2015
|
11.1%
|
100.0%
|
Performance Periods
|
% of Synergy Target Part vesting if Synergy Target achieved
|
1 August 2012 to 31 August 2013
|
33.3%
|
1 September 2013 to 31 August 2014
|
33.3%
|
1 September 2014 to 31 August 2015
|
33.3%
|
100.0%
|
Stefano Pessina
|
Dominic Murphy
|
1. | ELIGIBILITY |
2. | BONUS PLAN DESIGN |
Total Bonus =
|
Business performance bonus
|
60% Weight
|
+ Individual performance bonus
|
40% Weight
|
3. | PERFORMANCE MEASURES |
4. | SETTING TARGETED PAYMENTS |
5. | MINIMUM THRESHOLD |
- | No bonus will be paid to individuals if the business performance for those businesses shown on the bonus schedule fail to reach the minimum threshold for bonus payments. |
- | No bonus will be paid to individuals with a performance rating of 1. |
- | Where an individual’s performance rating is 2, the Managing Director/Country Manager will have the discretion to recommend that the relevant business bonus should also be reduced by up to 50%. |
- | Where an individual’s performance rating is 2, the Divisional Executive Director will have the discretion to recommend that the relevant divisional bonus should also be reduced by up to 50%. |
- | Where an individual’s performance rating is 2, the Group Executive Director will have the discretion to recommend that the relevant group bonus should also be reduced by up to 50%. |
6. | BONUSES AND COMPANY PENSION SCHEMES |
7. | REVIEW AND APPROVAL PROCESS |
8. | ADMINISTRATION AND CONDITIONS FOR PAYMENT |
· | The Plan will run for an accounting year (01.04.14-31.3.15). The Plan is discretionary and the Company reserves the right to withdraw or vary the Plan at the end of any review period. Participation in the Plan in any one year will be at the sole discretion of the relevant Executive Director. |
· | Any payment under the Plan will be paid with the June payroll, after the results for the year have been confirmed. |
· | At the discretion of the Executive Director new employees commencing during the year will be eligible to join the Plan on a pro-rata basis for whole months worked, provided they have commenced employment prior to 1 January 2015. |
· | Individuals transferring to positions which are eligible for the Plan, or moving to positions covered by a different country or division or group scheme, will be eligible for a reward for the relevant position(s) on a pro-rata basis for whole months worked, provided they have worked for at least three months in the role. The subsequent reward will be based on the appropriate salary for each role carried out. If they have worked for less than three months in the new role, the full year’s award will be based on their previous role and salary. |
· | Personal Bonuses will be prorated for any periods of paid or unpaid leave of absence, such as Parental Leave, Maternity Leave, Time off for family emergencies, sickness etc. |
· | Participants leaving the Group’s employment, for any reason, before payment falls due, or employees under notice at that time, will forfeit any right to a bonus payment from the Plan. However, bonuses for members retiring or leaving the Group early due to ill-health retirement will be paid at the discretion of the Division Executive Director. |
· | The relevant Executive Director reserves the right to exercise discretion in interpreting the rules of the Plan. |
1. | ‘the Company’: Alliance UniChem Plc (registered number: 2515178) whose registered office is at Alliance House, 2 Heath Road, Weybridge, Surrey KT13 8AP; |
2. | ‘the Executive’: George Rollo Fairweather of [ADDRESS] |
1. | Interpretation |
1.1 | In this Agreement, the headings and marginal headings to the clauses are for convenience only and have no legal effect. |
1.2 | Any reference in this Agreement to any Act or delegated legislation includes any statutory modification or re-enactment of it or the provision referred to. |
1.3 | Any reference in this Agreement to a person shall include a reference to a firm and corporation and vice versa and any reference to the singular shall include the plural and vice versa. |
1.4 | In this Agreement: |
‘Alliance UniChem’ | means Alliance UniChem Plc (registered number 2515178) |
‘the Board’ | means the Board of Directors of the Company from time to time and includes any committee of the Board duly appointed by it |
‘Businesses’ | means all and any trades or other commercial activities of the Company or any Group Company: |
(a) | with which the Executive (or any other employee, of the Company or any Group Company, on his behalf or under his instructions) shall have been concerned or involved to any material extent at any time during the period of 12 months ending on the Termination Date; or |
(b) | which the Company or any Group Company shall at the Termination Date have determined to carry on in the immediate or foreseeable future and in relation to which the Executive shall at the Termination Date possess any Confidential Business Information |
‘Chief Executive’ | means any person or persons jointly holding such office of Alliance UniChem from time to time and includes any person(s) exercising substantially the functions of a chief executive officer of Alliance UniChem |
‘Company Invention’ | means any improvement, invention or discovery made by the Executive which applying the provisions of section 39 of the Patents Act 1977 in the determination of ownership is, as between the parties, the property of the Company |
‘Company Secretary’ | means the company secretary of Alliance UniChem from time to time |
‘Confidential Business Information’ | means Trade Secrets and all other confidential information of the Company and/or any Group Company, both of which include but are not limited to the following: all and any Corporate Information, Marketing Information, Technical Information and other information (whether or not recorded in documentary form or on computer disk or tape) to which the Company or any Group Company attaches an equivalent level of confidentiality or in respect of which it owes an obligation of confidentiality to any third party which the Executive shall acquire at any time during his employment by the Company but which does not form part of the Executive’s own stock in trade |
“Corporate Information’ | means all and any information (whether or not recorded documentary form or on computer disk or tape) relating to financial projections and targets, financial details and accounts, budgets, the business methods, corporate and business plans, management systems, finances, maturing new business opportunities or research and development projects of the Company or any Group Company |
‘Customer’ | means any person (other than those listed in Schedule 2 hereto (if any) which the parties acknowledge have been introduced by the Executive to the Company) who or which shall be at or have been during the six month period immediately preceding the Termination Date negotiating with the Company or any Group Company for the supply of any Restricted Products or the provision of any Restricted Services or to whom or which the Company or any Group Company shall at any time during the period of one year prior to the Termination Date have supplied any Restricted Products or provided any Restricted Services |
‘Executive Scheme’ | means the Alliance UniChem share option scheme approved by shareholders on 21st May 1997, as the same is currently in force and the same may from time to time hereafter be amended modified or replaced |
‘Group Company’ | means Alliance UniChem and any “subsidiary” company of the Company and any “subsidiary undertaking” the Company (as such expressions are defined by sections 736, 736A, 258 and 259 of the Companies Act 1985) and any other company which for the time being is a company having an ordinary share capital (as defined in section 832 of the Income and Corporation Taxes Act 1988) of which not less than 25 per cent is owned directly or indirectly by the Company applying the provisions of section 838 of the Income and Corporation Taxes Act 1988 in the determination of ownership |
‘Incentive Scheme’ | means the Alliance UniChem share incentive plan approved by shareholders on 12th June 1998, as the same is currently in force and the same may from time to time hereafter be amended modified or replaced |
‘Marketing Information’ | means all and any information (whether or not recorded in documentary form or on computer disk or tape) relating to the marketing or sales of any past, present or future product or service of the Company or any Group Company including without limitation sales targets and statistics, market share and pricing statistics, marketing surveys and plans, market research reports, marketing and advertising plans and materials, marketing and advertising requirements, sales techniques, price list, discount structures, pricing policies, commissions, the names, addresses, telephone numbers, contact names and identities of Customers and potential customers of any suppliers and potential suppliers to the Company or any Group Company, the nature of their business operations, their requirements for any product or service sold by the Company or any Group Company and all confidential aspects of their business relationship with the Company or any Group Company |
‘Material Interest’ | means: |
(a) | the holding of any position as director, officer, employee, consultant, partner, sub-contractor, principal or agent or any other position in any person which enables the Executive directly or indirectly to exercise influence; |
(b) | the direct or indirect control or ownership (whether jointly or alone) of any shares (or any voting rights attached to them) or debentures save for the ownership for investment purposes only of not more than 3 per cent of the issued ordinary shares of any company whose shares are listed on any recognised investment exchange (as defined in section 207 of the Financial Services Act 1986); or |
(c) | the direct or indirect provision of any financial assistance (as defined in section 152 of the Companies Act 1985) |
‘Pension Scheme’ | means the Alliance UniChem pension scheme established by an interim trust deed dated 25th July 1974, as the same may from time to time be amended modified or replaced |
‘the 1993 Scheme’ | means the Alliance UniChem pension scheme for higher rate employees established by a trust deed dated 7th November 1994, as the same is currently in force and as the same may from time to time be amended modified or replaced and which scheme is not, and is not currently intended to be, approved by the Inland Revenue |
‘Remuneration Committee’ | the remuneration committee of Alliance UniChem |
‘Restricted Area’ | means England, Scotland and Wales |
‘Restricted Period’ | means 12 months from the Termination Date unless the Company has enforced its rights pursuant to clause 16.8.1, in which case ‘Restricted Period’ shall be that period from the Termination Date which aggregated with the period of time during which the Company has enforced its rights under clause 16.8.1 shall amount to 12 months |
‘Restricted Products’ | means all and any products of a kind that shall be dealt in, produced, marketed or sold by the Company or any Group Company from time to time in the ordinary course of the Businesses |
‘Restricted Services’ | means all and any services of a kind that shall be provided by the Company or any Group Company from time to time in the ordinary course of the Businesses |
‘Shares’ | means ordinary shares of ten pence each in the capital of Alliance UniChem being shares available for subscription pursuant to the Executive Scheme |
‘Technical Information’ | means all and any trade secrets, secret formulae, processes, inventions, designs, know-how, discoveries, technical specifications and other technical information (whether or not recorded in documentary form or on computer disk or tape) relating to the creation, development, production or supply of any past, present or future product or service of the Company or any Group Company |
‘Trade Secrets’ | means confidential information which is rightly described or regarded by the Company as a trade secret or which it is reasonably apparent is so commercially sensitive as to be a trade secret |
‘Termination Date’ | means the date on which the Executive shall cease to be employed by the Company |
2. | Appointment and duration |
2.1 | The Company appoints the Executive and the Executive agrees to act as Group Finance Director. The Executive accepts that the Company may at its discretion require him to perform (without any additional remuneration) other lawful duties or tasks not within the scope his normal duties and the Executive agrees to perform those duties or undertake those tasks as if they were specifically required under this Agreement. |
2.2 | The appointment shall be deemed to have commenced on 1st April 2002 and shall continue (subject to earlier termination as provided in this Agreement) until terminated by the Company giving to the Executive not less than 12 months prior written notice expiring at any time or by the Executive giving to the Company not less than 12 months prior written notice expiring at any time. |
2.3 | The Executive warrants that by virtue of entering into this Agreement or any other agreements or arrangements made or to be made between the Company or any Group Company and him he will not be in breach of any express or implied terms of any contract with or of any other obligation to any third party binding upon him. |
3. | Duties of the Executive |
3.1 | The Executive shall at all times during the period of this Agreement: |
3.1.1 | devote so much of his time, attention and ability as the Board considers necessary to the duties of his appointment; |
3.1.2 | faithfully and diligently perform those duties and exercise such powers consistent with them which are from time to time assigned to or vested in him; |
3.1.3 | obey all lawful and reasonable directions of the Board; |
3.1.4 | use his best endeavours to promote the interests of the Company and its Group Companies; and |
3.1.5 | not at any time make any malicious statement relating to the Company or any Group Company or any other statement likely to be harmful to the Company or any Group Company. |
3.2 | The Executive shall (without further remuneration) if and for so long as the Company requires during the period of this Agreement: |
3.2.1 | carry out the duties of his employment on behalf of any Group Company; |
3.2.2 | act as an officer of any Group Company or hold any other appointment or office as nominee or representative of the Company or any Group Company; |
3.2.3 | carry out such duties and the duties attendant on any such appointments as if they were duties to be performed by him on behalf of the Company. |
4. | Reporting |
4.1 | The Executive shall report directly to the Chief Executive and shall at all times keep the Chief Executive promptly and fully informed (in writing if so requested) of his conduct of the business or affairs of the Company and its Group Companies and provide such explanations as the Chief Executive may require. |
5. | Place of work and residence |
5.1 | The Executive shall perform his duties at the head office of the Company from time to time (currently located at Alliance House, 2 Heath Road, Weybridge, Surrey) and/or at such other place of business of the Company or of any Group Company as the Company requires whether inside or outside the United Kingdom. The Executive acknowledges that the Company may require him to permanently relocate to work at any head office or other place of business of the Company and/or any Group Company, within a 25 mile radius of the Company’s current head office, but save as aforesaid the Executive shall not be obliged to permanently relocate his place of work. The Company shall not without his prior consent require the Executive to go to or reside anywhere outside the United Kingdom except for occasional visits in the ordinary course of his duties. |
6. | Pay |
6.1 | During his appointment the Company shall pay to the Executive a salary at the rate of £310,000 per year which shall accrue day-to-day and be payable by equal monthly instalments in arrears on or about the 22nd day of each month. The salary shall be deemed to include any fees which may be receivable by the Executive as a director of the Company, if applicable, or any Group Company and shall also be deemed to include any fees receivable by the Executive in respect of any other company or unincorporated body in which he holds office as nominee or representative of the Company or any Group Company. |
6.2 | The Remuneration Committee shall review the Executive’s salary from time to time and the rate of salary may be increased by such amount if any as they may resolve. |
6.3 | The Company may in its absolute discretion establish (and from time to time determine, vary or replace) a performance related remuneration scheme for the Executive. Any such scheme shall be discretionary, shall not be a contractual entitlement and the Company shall have no liability to the Executive for failure to establish, pay out under or maintain any such scheme. Without prejudice to the generality of the foregoing, the duration and terms and conditions of any such scheme (including without limitation targets and related payments) shall be as the Company may from time to time in its absolute discretion expressly notify the Executive in writing. |
7. | The Incentive Scheme and Executive Scheme |
7.1 | The Executive may be entitled to subscribe for such number of Shares as the Remuneration Committee may from time to time determine and notify the executive in writing, subject to the terms and conditions of the incentive Scheme and / or the Executive Scheme and PROVIDED THAT: |
7.1.1 | prior to any subscription by the Executive he complies with all relevant Inland Revenue regulations and the Company obtains such approval from the Inland Revenue as the Remuneration Committee thinks fit; and |
7.1.2 | prior to any subscription the Remuneration Committee approves such proposed subscription. |
8. | Pension |
8.1 | The Executive shall be entitled to be and remain a member of the Pension Scheme subject to the terms of its deeds and rules from time to time details of which are available from the Company Secretary. For so long as the Executive is a member of the Pension Scheme, the Executive shall also be entitled to become and remain a member of the 1993 Scheme, subject to the terms of its deed and rules from time to time, details of which are available from the Company Secretary. |
8.2 | The Company shall be entitled at any time to terminate the Pension Scheme and/or the 1993 Scheme (as the case may be) or the Executive’s membership thereof subject to providing the Executive with the benefit of an equivalent pension scheme (‘the New Scheme’) each and every benefit of which shall be no less favourable than the accrued and future benefits provided or to be provided to the Executive under the Pension Scheme or the 1993 Scheme (as the case may be). The Company shall be entitled to amend or modify the Pension Scheme and/or the 1993 Scheme provided that the benefits provided or to be provided under such amended or modified scheme are no less favourable than the accrued benefits provided or to be provided before any such amendment or modification took effect. |
8.3 | In the event of the death of the Executive while still employed by the Company, the Company shall pay a sum equal to four times his annual salary on the date of his death. The sum payable under this clause 8.3 shall be reduced by any cash sum payable under the Trust of the Pension Scheme less any cash sum constituting a refund of his compulsory contributions to the Pension Scheme. |
9. | Insurance Benefits |
9.1 | The Executive shall be entitled to participate at the Company’s expense: |
9.1.1 | for his own benefit in the Company’s permanent health insurance scheme; and |
9.1.2 | for his own, his spouse’s and his dependant children’s benefit in the Company’s private medical expenses insurance scheme; and |
9.1.3 | for his own, his spouse’s and his dependant children’s benefit in the Company’s personal accident and travel insurance scheme, |
9.2 | The Company shall be entitled to vary or replace any such schemes referred to in clause 9.1 from time to time provided always that the benefits provided under any such varied or replacement scheme are in all material respects (in the Company’s reasonable opinion) at least as beneficial to the Executive as the schemes thereby varied or replaced. Notwithstanding the foregoing, if in the reasonable opinion of the Company (whose opinion shall be conclusive) the continuation of any of the benefits set out in this clause 9.2 is not reasonably practicable (including without limitation by reason of the cost thereof) the Company shall be entitled to terminate the provision of any such benefits. |
10. | Car |
10.1 | Subject to the Executive holding a current full driving licence the Company shall provide the Executive, for business and private use by him, his spouse and any other driver holding a current full driving licence previously approved by the Company, with a car of a make, model and specification selected by the Company which in the opinion of the Board is commensurate with the current status of the Executive (taking account of any promotions or demotions) and the image of the Company. |
10.2 | The Company shall bear all insurance costs standing and running expenses of the car with the exception of the cost of fuel and recovery where the car is used outside the United Kingdom for private purposes. |
10.3 | The Company shall replace such car with the same or equivalent model in accordance with the Company’s car policy in effect from time to time. |
10.4 | The Executive shall always comply with all regulations laid down by the Company from time to time with respect to company cars and shall forthwith notify the Company of any accidents involving his company car and of any charges for parking or driving offences which are brought against him or, in relation to the use of the car brought against any person authorised to use the car as provided in clause 10.1. On the termination of his employment whether lawfully or unlawfully the Executive shall forthwith return his company car (and all sets of keys therefor) clean and in good interior and exterior condition to the Company at its head office. |
10.5 | Subject to clause 10.6, the Executive may elect to take a cash sum as an alternative to the benefit detailed in clauses 10.1 to 10.4. The sum will be: |
10.5.1 | in accordance with the Company’s car cash alternative policy in effect from time to time; |
10.5.2 | paid in arrears in twelve equal instalments at the same time as his pay as detailed in clause 6.1; |
10.5.3 | excluded for the purpose of calculating any other benefit under this Agreement, other than at the sole discretion of the Company. |
10.6 | If the Executive chooses a car, he may elect to take the cash alternative under clause 10.5 at the time the car is due to be replaced under clause 10.3. If he elects to take the cash alternative under clause 10.5, he may rescind his election to be effective from any 1st January. |
11. | Expenses |
11.1 | The Company shall reimburse to the Executive on a monthly basis all travelling, hotel, entertainment and other expenses reasonably incurred by him in the proper performance of his duties subject to the Executive complying with such guidelines or regulations issued by the Company from time to time in this respect and to the production to the Company of such vouchers or other evidence of actual payment of such expenses as the Company may reasonably require. |
11.2 | Where the Company issues a company sponsored credit or charge card to the Executive he shall use such card only for expenses reimbursable under clause 11.1 above, and shall return it to the Company forthwith on the termination of his employment (or if so required by the Company on the giving by either party of notice to terminate his employment, whether lawfully or not). |
11.3 | lf, in the Company’s reasonable opinion, it is necessary or appropriate for the Executive to be and remain a member of a recognised professional regulatory body for the better performance of the Executive’s duties, then: |
11.3.1 | the Company shall pay the appropriate subscription and the annual membership fee, to permit the Executive to be and remain a member of such body; |
11.3.2 | the Company shall pay the cost of any fees for continuing education or training that is necessary to permit the Executive to continue as a member of any such body. |
12. | Holiday |
12.1 | In addition to public holidays the Executive is entitled to 30 working days paid holiday in each holiday year from 1st January to 31st December to be taken at such time or times as are agreed with the Chief Executive. The Executive shall not without the prior consent of the Chief Executive carry forward any unused part of his holiday entitlement to a subsequent holiday year. |
12.2 | For the holiday year during which his employment commences or terminates, the Executive is entitled to 2 1/2 working days holiday for each complete calendar month of his employment by the Company during that holiday year. On the termination of his employment for whatever reason, the Executive shall not be entitled to pay in lieu of outstanding holiday entitlement (save if his employment has been terminated by the Company in breach of the terms and/or conditions of his employment) and the Executive shall be required to repay to the Company any holiday pay received in excess of his actual entitlement. |
13. | Incapacity |
13.1 | If the Executive shall be prevented by illness (including mental disorder) injury or other incapacity from properly performing his duties hereunder he shall report this fact forthwith to the Chief Executive and if the Executive is so prevented for seven or more consecutive days he shall provide a medical practitioner’s statement on the eighth day and weekly thereafter so that the whole period of incapacity is certified by such statements. Immediately following his return to work after a period of absence due to incapacity the Executive shall complete a self-certification form available from the Company Secretary’s office detailing the reason for his absence. |
13.2 | If the Executive shall be absent from his duties hereunder due to illness (including mental disorder) injury or other incapacity duly certified in accordance with the provisions of clause 13.1 hereof, he shall be paid his full remuneration hereunder for up to 180 working days’ absence in any period of 12 consecutive months and thereafter such remuneration, if any, as the Board shall from time to time determine provided that all such remuneration shall be inclusive of any Statutory Sick Pay to which the Executive is entitled or other benefits recoverable by the Executive (whether or not recovered) may be deducted therefrom. |
13.3 | For Statutory Sick Pay purposes the executive’s qualifying days shall be his normal working days. |
13.4 | At any time during the period of this employment the Executive shall at the request and expense of the Company permit himself to be examined by a registered medical practitioner (if in the Company’s reasonable opinion any such examination is necessary or appropriate), such medical practitioner to be selected by the Company. The Executive authorises such medical practitioner to disclose to and discuss with the Company’s medical adviser the results of such examination (“the Results”) and any matters which arise from it in order that the Company’s medical adviser can notify the Company of any matters which, in his opinion, might hinder or prevent the Executive (if during a period of incapacity) from returning to work for any period or (in other circumstances) from properly performing any duties of his appointment at any time. Subject to the provisions of law or professional conduct prohibiting disclosures of the Results to the Executive, the Executive shall be entitled to be informed of the Results. |
13.5 | The Company may terminate the Executive’s employment on the grounds of incapacity, as set out in clause 16 hereof. |
14. | Acknowledgements by the Executive |
14.1 | The Executive acknowledges: |
14.1.1 | that the Company and each Group Company possesses a valuable body of Confidential Business Information; |
14.1.2 | that the Company will give him access to Confidential Business Information in order that he may carry out the duties of his appointment; |
14.1.3 | that the duties of his employment include, without limitation, a duty of trust and confidence and a duty to act at all times in the best interests of the Company; |
14.1.4 | that the Company requires all its senior employees to accept restrictions which are similar to those set out in clauses 15 and 17 for its and each of their mutual protection; |
14.1.5 | that the disclosure of any Confidential Business Information to any customer or actual or potential competitor of the Company or any Group Company could place such company at a serious competitive disadvantage and could cause immeasurable (financial and other) damage to the Businesses; |
14.1.6 | that if during the Restricted Period he was to hold any Material Interest in a Customer or any actual or potential competitor of the Company or any Group Company, it would place such company at a serious competitive disadvantage and would cause immeasurable (financial and other) damage to the Businesses. |
15. | Obligations during employment |
15.1 | Inventions |
15.1.1 | If at any time during his employment the Executive (whether alone or with any other person or persons) makes any invention which relates either directly or indirectly to the Businesses the Executive shall promptly disclose to the Company full details, including drawings and models, of such invention to enable the Company to determine whether or not it is a Company Invention. |
15.1.2 | If the invention is a Company Invention, the Executive shall hold it in trust for the Company and, at the request and expense of the Company, do all things necessary or desirable to enable the Company or its nominee to obtain for itself the full benefit of and to secure patent or other appropriate forms of protection for the Company Invention throughout the world. |
15.1.3 | Decisions as to the patenting and exploitation of any Company Invention shall be at the sole discretion of the Company. |
15.1.4 | The Executive irrevocably appoints the Company to be his attorney in his name and on his behalf to executive documents. and/or deeds to use the Executive’s name and to do all things which may be necessary or desirable for the Company to obtain for itself or its nominee the full benefit of the provisions of clauses 15.1.2 and 15.2.2 and a certificate in writing signed by the Chief Executive that any instrument or act falls within the authority hereby conferred shall be conclusive evidence that such is the case so far as any third party is concerned. |
15.2 | Copyright etc. |
15.2.1 | The Executive shall promptly disclose to the Company all copyright works or designs originated, conceived, written or made by him alone or with others (except only those works originated, conceived, written or made by him wholly outside his normal working hours which are wholly unconnected with his appointment) and shall hold them in trust for the Company until such rights shall be fully and absolutely vested in the Company. |
15.2.2 | The Executive hereby assigns to the Company by way of future assignment all copyright, design right and other proprietary rights (if any) for the full terms thereof throughout the world in respect of all copyright works and designs originated, conceived, written or made by the Executive (except only those works originated, conceived, written or made by the Executive wholly outside his normal working hours which are wholly unconnected with his appointment) during the period of his appointment with the Company. |
15.2.3 | The Executive hereby irrevocably and unconditionally waives in favour of the Company any and all moral rights conferred on him by Chapter IV of Part I of the Copyright Designs and Patents Act 1988 for any work in which copyright or design right is vested in the Company whether by clause 15.2.2 or otherwise. |
15.2.4 | The Executive shall, at the request and expense of the Company, do all things necessary or desirable to substantiate the rights of the Company under clauses 15.2.2 and 15.2.3. |
15.3 | Share dealings |
15.3.1 | The Executive shall comply, where relevant, with every rule of law, every requirement of the London Stock Exchange and every regulation of the Company from time to time in force in relation to dealings in the shares, debentures or other securities of the Company or any Group Company and unpublished price sensitive information affecting the shares, debentures or other securities of the Company and any Group Company or any other company and, in relation to overseas dealings, the Executive shall also comply with all laws of the state and all regulations of the stock exchange, market or dealing system in which such dealings take place. |
15.3.2 | The Executive shall not (and shall procure so far as he is able that his spouse and children shall not) deal or become or cease to be interested (within the meaning of Part I of Schedule 7 to the Companies Act 1985) in any securities of the Company or any Group Company except in accordance with any Company rules or guidelines from time to time relating to securities transactions by directors. |
15.4 | Conflict of interest |
15.4.1 | The Executive agrees that during the period of his appointment with the Company, he shall: |
15.4.1.1 | abide by any lawful relevant Company policy that may be promulgated from time to time; |
15.4.1.2 | not directly or indirectly disclose to any person, firm or company or use other than for any legitimate purposes of the Company or any Group Company any Confidential Business Information and the Executive shall use all due care and diligence to prevent any unauthorised disclosure or use of any Confidential Business Information; |
15.4.1.3 | not without the Board’s prior written permission hold any Material Interest in any person firm or company which: |
(a) | is or shall be in competition with any of the businesses carried on by the Company and/or any Group Company from time to time; |
(b) | impairs or might reasonably be thought by the Board to impair his ability to act at all times in the best interests of the Company; or |
(c) | requires or might reasonably be thought by the Board to require him to disclose any Confidential Business Information in order properly to discharge his duties to or to further his interest in such person, firm or company; |
15.4.1.4 | not directly or indirectly receive or obtain in respect of any goods or services sold or purchased or other business transacted (whether or not by him) by or on behalf of the Company or any Group Company any discount, rebate, commission or other inducement (whether in cash or in kind) which is not authorised by any Company rules or guidelines from time to time and if he or any person firm or company in which he holds any Material Interest shall obtain any such discount, rebate, commission or inducement, he shall immediately account to the Company for the discount rebate commission or other inducement so received; |
15.4.1.5 | not (other than for the proper performance of his duties) without the prior authority of the Board remove from the Company and/or any Group Company’s premises or copy or allow others to copy the contents of any document, computer disk, tape, memory device, notebook or other tangible item (whether or not eye-readable) which contains any Confidential Business Information or which belongs to the Company or any Group Company; |
15.4.1.6 | return to the Company upon request and, in any event, at the Termination Date all documents, papers, computer disks, tapes, other reusable material, memory devices, notebooks and other tangible items in his possession or under his control (including without limitation those referred to in clause 15.4.2) which belong to the Company or any Group Company or which contain or refer to any Confidential Business Information; |
15.4.1.7 | if so lawfully requested by the Board at any time delete or return to the Company, as the Company may require, all Confidential Business Information from any computer disks, tapes or other reusable material in his possession or under his control and destroy or return to the Company, as the Company may require, all other documents and tangible items in his possession or under his control which contain or refer to any Confidential Business Information. |
15.4.2 | All documents, notes, the contents of all computer discs and tapes, memoranda, records and writing and made by the Executive relating to the business of the Company and/or any Group Company shall be and remain the property of the Company and/or any Group Company to whose business they relate and shall be returned to the company to whom they belong forthwith upon request. |
15.5 | General |
15.5.1 | The restriction contained in clauses 15.4.1.2 and 17.3: |
15.5.1.1 | will not restrict the Executive from disclosing (but only to the proper recipient) any Confidential Business Information which the Executive is required to disclose by law or any order of the court of any relevant regulatory body, provided that the Executive shall, unless obliged by law, have given prior written notice to the Company of the requirement and of the information to be disclosed and allowed the Company an opportunity to comment on the requirement before making the disclosure; and |
15.5.1.2 | will not apply to Confidential Business Information which is in or which comes into the public domain otherwise than as a result of an unauthorised disclosure by the Executive or any other person who owes the Company and/or any Group Company an obligation of confidentiality in relation to the information disclosed. |
15.6 | Further restrictions |
15.6.1 | The Executive shall not during his employment (save in a purely social capacity or with the prior express written consent of the Chief Executive) make any contact, whether formal or informal, written or oral, with any of the Company or Group Company’s past, current or prospective suppliers of goods for resale, customers or clients for any purpose (including but not limited to an intention to set up a competing business or to seek employment) other than for the legitimate business interests of the Company or Group Company. |
15.6.2 | The Executive shall not during his employment directly or indirectly: |
15.6.2.1 | solicit or endeavour to entice away from the Company or any Group Company an employee or consultant, or discourage from being employed or engaged by the Company or any Group Company any person who is an employee or consultant of or, to the knowledge of the Executive, a prospective employee or consultant of the Company or any Group Company; or |
15.6.2.2 | employ or engage or procure another person to employ or engage any such person. |
15.7 | The restrictions set out in this clause 15 are without prejudice to the other duties whether fiduciary or otherwise owed to the Company or any Group Company whether express or implied. |
16. | Termination of agreement |
16.1 | Automatic termination |
16.1.1 | on the Executive reaching his retirement age being his 60th birthday; or |
16.1.2 | if the Executive is or becomes a director of the Company and the Executive becomes prohibited by law from being a director; or |
16.1.3 | if the Executive is or becomes a director of the Company and the Executive resigns his office as a director; or |
16.1.4 | if the Executive is or becomes a director of the Company and the office of director of the Company held by the Executive is vacated pursuant to the Company’s Articles of Association (save if the vacation shall be caused by illness (including mental disorder) or injury) or if the Executive is otherwise duly removed from his office of director. |
16.2 | Suspension |
16.3 | Immediate dismissal |
16.3.1 | commits any act of gross misconduct or any other material breach of the obligations of his employment or (after written warning) repeats or continues any breach of such obligations; or |
16.3.2 | is guilty of any conduct which in the reasonable opinion of the Board brings him, the Company or any Group Company into disrepute; or |
16.3.3 | is convicted of any criminal offence (excluding an offence under road traffic legislation in the United Kingdom or elsewhere for which he is not sentenced to any term of imprisonment whether immediate or suspended); or |
16.3.4 | commits any act of dishonesty whether relating to the Company, any Group Company, any of its or their employees or otherwise; or |
16.3.5 | becomes bankrupt or makes any arrangement or composition with his creditors generally (under the provisions of the Insolvency Act 1986); or |
16.3.6 | becomes of unsound mind or a patient as defined in either section 112 or 145 of the Mental Health Act 1983 or has been admitted to a hospital in pursuance of an application made under that Act; or |
16.3.7 | contravenes any model code from time to time applicable to directors and/or employees of the Company. |
16.4 | Dismissal on short notice |
16.4.1 | notwithstanding clause 13.2 by not less than 6 months’ prior notice given at any time while the Executive is incapacitated by ill-health or accident from performing his duties under this Agreement and he has been so incapacitated for a period or periods aggregating more than 180 working days in the preceding 12 months. Provided that the Company shall withdraw any such notice if during the currency of the notice the Executive returns to full time duties and provides a medical practitioner’s certificate satisfactory to the Board to the effect that he has fully recovered his health and that no recurrence of his illness or incapacity can reasonably be anticipated. |
16.4.2 | by not less than one month’s prior notice if the Executive has been offered but has refused to agree to the transfer of this Agreement by way of novation to a person, firm or company which has acquired or agreed to acquire the whole or substantially the whole of any undertaking (as defined in the Transfer of Undertakings (Protection of Employment) Regulations 1981) in which he is employed to any extent. |
16.5 | Resignation on a change in control |
16.6 | Pay in lieu |
16.7 | Miscellaneous |
16.7.1 | resign from all and any offices which he may hold as a director of the Company or of any Group Company and from all other appointments or offices which he holds as nominee or representative of the Company or any Group Company; and |
16.7.2 | transfer without payment to the Company or as the Company may direct any qualifying shares provided by it to him; |
16.8 | Provisions applicable during a notice period |
16.8.1 | In the event that either party gives notice to terminate the appointment of the Executive then for a period not exceeding 12 months the Company shall be under no obligation to vest in or assign to the Executive any powers or duties or to provide any work for the Executive and without prejudice to the generality of the foregoing the Company may in its absolute discretion require the Executive to perform only such duties as it may allocate to him (including without limitation research projects or any other work whether or not directly related to the Executive’s duties) or not to perform any of his duties under this Agreement or to work in such other capacities as the Company may require (commensurate with the Executive’s status) and/or to exclude him from any premises of the Company or of any Group Company (without providing any reason therefor) provided always that throughout any such period the Executive’s salary (and other contractual remuneration, if any) under clause 6 and other contractual benefits shall not cease to be paid or provided (unless and until his employment shall be terminated). |
16.8.2 | Action taken on the part of the Company (as referred to in clause 16.8.1) shall not constitute a breach of this Agreement of any kind whatsoever in respect of which the Executive has any claim against the Company. |
16.8.3 | If the Executive fails to make himself available for work during any period of notice of termination of the Executive’s employment, other than at the request of the Company pursuant to clause 16.8.1 or with the express permission in writing of the Chief Executive, the Company reserves the right to deduct one day’s salary (and any amount payable under any discretionary performance related remuneration scheme pursuant to clause 6.3) for each day of each such absence. |
16.8.4 | If and insofar as the Company exercises its rights under clause 16.8.1 so as to exclude the Executive from the premises of the Company during the notice period, then the Executive may carry out other activities (for persons other than the Company or any other Group Company) subject to obtaining the previous express written consent of the Chief Executive which consent may be given subject to such terms and conditions as he may determine (each of which shall be deemed a condition of this Agreement) and such consent, if given may be revoked at any time. Provided that the Executive has provided the Chief Executive (and at all times kept the Chief Executive up to date and fully informed) on the basis of the utmost good faith, with full particulars of the nature of any interest and the likely demand it will make on his time and abilities, the consent of the Chief Executive to the Executive undertaking any other activities shall not be unreasonably withheld or revoked where, in the reasonable opinion of the Chief Executive the giving or failing to revoke consent would not materially adversely affect the interests of the Company or any Group Company or the full performance by the Executive of his duties hereunder or such duties, if any, as the Company may require the Executive to perform pursuant to clause 16.8.1. |
17. | Obligations after employment |
17.1 | The Executive shall not within the Restricted Area directly or indirectly: |
17.1.1 | without prior express consent in writing of the Chief Executive (as referred to in clause 17.2) during the Restricted Period, hold any Material Interest in any business (including without limitation in any Customer) which is or shall be wholly or partly in competition with any of the Businesses including without limitation those listed in Schedule 3 and their respective subsidiaries and holding companies (as defined in sections 736 and 736A of the Companies Act 1985) (being companies in which the parties acknowledge that the Executive would inevitably give his new employer an unfair advantage vis-à-vis the Company in view of his embedded knowledge of the Company and those companies’ status as head-on competitors of the Company; |
17.1.2 | without the prior express consent in writing of the Chief Executive (as referred to in clause 17.2) during the Restricted Period, hold any Material Interest in any person, firm or company which requires or might reasonably be thought by the Company to require him to disclose or make use of any Confidential Business Information in order properly to discharge his duties to or to further his interest in such person, firm or company; |
17.1.3 | without the prior express consent in writing of the Chief Executive (as referred to in clause 17.2) during the Restricted Period, seek in any capacity whatsoever (either alone or jointly with any other person and whether on his own account or in partnership with others or as an officer employee agent of or consultant to any other person) any business, orders or custom for any Restricted Products or Restricted Services from any Customer; |
17.1.4 | without the prior express consent in writing of the Chief Executive (as referred to in clause 17.2) during the Restricted Period, accept in any capacity whatsoever (either alone or jointly with any other person and whether on his own account or in partnership with others or as an officer employee agent of or consultant to any other person) orders for any Restricted Products or Restricted Services from any Customer; |
17.1.5 | at any time after the Termination Date (either alone or jointly with any other person and whether on his own account or in partnership with others or as an officer employee agent of or consultant to any other person) interfere or seek to interfere or take such steps as may interfere with the continuance of supplies to the Company and/or any Group Company which are at the Termination Date or have within 12 months prior to the Termination Date been supplying goods, components, materials or supplies to the Company and/or any Group Company; |
17.1.6 | at any time before or after the Termination Date (either alone or jointly with any other person and whether on his own account or in partnership with others or as an officer employee agent of or consultant to any other person) induce or seek to induce by any means involving the disclosure or use of Confidential Business Information any Customer to cease dealing with the Company or any Group Company or to restrict or vary the terms upon which it deals with the Company or any Group Company; |
17.1.7 | for the period of 12 months after the Termination Date (either alone or jointly with any other person and whether on his own account or in partnership with others or as an officer employee agent of or consultant to any other person) solicit or entice away or seek to solicit or entice away from the Company or any Group Company any person who is and was at the Termination Date employed by the Company or any Group Company to work in any of the Businesses as a director senior manager or salesperson and/or who reported directly or indirectly to the Executive; |
17.1.8 | at any time after the Termination Date represent himself or permit himself to be held out by any person firm or company as being in anyway connected with or interested in the Company or any Group Company (save as the holder of Shares if such be the case); |
17.1.9 | at any time after the Termination Date disclose or make use of any Trade Secrets while such Trade Secrets remain in the nature of trade secrets. |
17.2 | The consent of the Chief Executive to the Executive having any interest or engaging in any of the matters referred to in clause 17.1.1, 17.1.2, 17.1.3 and/or 17.1.4 may be given subject to such terms and conditions as he may specify (each of which shall be deemed a condition of this Agreement) and such consent if given may be revoked at any time. Provided that the Executive has provided the Chief Executive (and at all times kept him fully up to date and informed) on the basis of the utmost good faith with full particulars of the nature of any interest or other activity as referred to in clause 17.1.1, 17.1.2, 17.1.3 and/or 17.1.4, the consent of the Chief Executive to the Executive having any such interest or undertaking any such activity shall not be unreasonably withheld or revoked where in the reasonable opinion of the Chief Executive the giving or failing to revoke consent would be: |
17.2.1 | immaterial in relation to the Businesses; |
17.2.2 | immaterial in relation to the level of business orders or custom for Restricted Products and/or Restricted Services from any Customer. |
17.3 | The Executive shall not at any time after the Termination Date directly or indirectly disclose to any person, firm or company or make use of any Confidential Business Information. |
17.4 | The Executive agrees that the restrictions contained in clauses 17.1, 17.3 and 15 are reasonable and necessary for the protection of legitimate interests of the Company and each Group Company and that, having regard to those interests, those restrictions do not work harshly on him. It is nevertheless agreed that if any of those restrictions shall taken together or separately be held to be void or ineffective for any reason but would be held to be valid and effective if part of the wording were deleted, or the period or area of application reduced, that restriction shall apply with such deletions or with such reduced period or area of application as may be necessary to make it valid and effective. |
17.5 | The restrictions contained in each sub-clause of clauses 17.1, 17.3 and 15 shall be construed as separate and individual restrictions and shall each be capable of being severed without prejudice to the other restrictions or to the remaining provisions of this Agreement. |
17.6 | The Executive has given the undertakings contained in clauses 17.1, 17.3 and 15 to the Company for itself and as trustee for each Group Company and the Executive will at the request and cost of the Company enter into direct undertakings with any Group Company which correspond to the undertakings in clauses 17.1, 17.3 and 15, or which are less onerous only to the extent necessary (in the opinion of the Company or its legal advisors) to ensure that such undertakings are valid and enforceable. |
17.7 | The Company shall not be entitled to rely on the covenants contained in clauses 17.1.1 to 17.1.8 (inclusive) if the Company has committed a repudiatory breach of this Agreement. |
18. | General |
18.1 | Other terms or benefits |
18.1.1 | The provisions of the Company’s standard terms and conditions of employment, contained in the Company’s Staff Handbook (as amended from time to time) (the “Staff Handbook”), shall be terms of the Executive’s employment except to the extent that they are inconsistent with this Agreement. In the case of a conflict between this Agreement and the Staff Handbook the provisions of this Agreement shall prevail. The Staff Handbook is available from the Company Secretary. |
18.1.2 | This Agreement sets out all the salary and other benefits to which the Executive is entitled and any other benefits are non-contractual, are provided in the absolute discretion of the Company and may be withdrawn at any time. |
18.2 | Statutory particulars |
18.3 | Prior agreements |
18.4 | Accrued rights |
18.5 | Proper law |
18.6 | Acceptance of jurisdiction |
18.7 | Notices |
18.8 | Consent |
1. | The Executive’s employment by the Company commenced on 2 nd April 2002. |
2. | No employment of the Executive with a previous employer counts as part of the Executive’s continuous employment with the Company and his continuous employment began on 2 nd April 2002. |
3. | The Executive’s hours of work are the normal hours of the Company from 9.00am to 5.00pm Monday to Friday each week together with such additional hours as may be necessary so as properly to fulfil his duties. |
4. | A Contracting-Out Certificate pursuant to the provisions of the Social Security Pensions Act 1975 is held by the Company in respect of the executive’s employment. |
5. | The disciplinary rules applicable to the Executive are contained in the Company’s Staff Handbook that is available from the Company Secretary. |
6. | If the Executive is dissatisfied with any disciplinary decision relating to him or if the Executive has any grievance relating to his employment, this must be raised with the Chief Executive (either orally or in writing). If the Executive is dissatisfied with the decision of the Chief Executive, he must (within 5 days of the decision of the Chief Executive) request in writing to the Company Secretary a meeting with the Board. A meeting date will be communicated to the Executive and he will be invited to attend such meeting together with another person if the executive so wishes. The decision of the Board at such meeting will be notified to the executive within 5 days of such meeting and the decision of the Board will be final. |
7. | There are no collective agreements applicable to the Executive’s employment. |
SIGNED
by:
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authorised signatory for and on behalf of
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Alliance UniChem Plc |
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In the presence of:-
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/s/ Lucienne Greig
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Name
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Lucienne Greig
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Address
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39 Esher Road
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East Molesey
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KT8 0AH
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Occupation
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Personal Assistant
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EXECUTED
as a Deed:
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By the said
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George Rollo Fairweather
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In the presence of:-
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/s/ Philip Damian Brown
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Name
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Philip Damian Brown
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Address
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Ash House Fairfield Avenue
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Staines
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Occupation
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Chartered Secretary
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(1) | Alliance Boots plc whose registered office is at Sedley Place, 4 th Floor, 361 Oxford Street, London, W1C 2JL; |
(2) | Alliance UniChem Plc whose registered office is at 2 The Heights, Brooklands, Weybridge, Surrey, KT13 0NY; and |
(3) | GEORGE ROLLO FAIRWEATHER of [ADDRESS] (“The Executive”). |
(A) | The Executive is employed by Alliance UniChem Plc under the terms of a Service Agreement dated 28 March 2002 (“the Service Agreement”). |
(B) | On 31 July 2006 the merger of Boots Group PLC and Alliance UniChem Plc was completed and Boots Group PLC changed its name to Alliance Boots plc. |
1. | On 31 July 2006 the Executive’s Service Agreement with Alliance UniChem Plc terminated by mutual consent. |
2. | With immediate effect thereafter a New Service Agreement commenced between the Executive and Alliance Boots plc (“the New Service Agreement”). The New Service Agreement was agreed to be on identical terms to the Service Agreement save for the removal of the restriction under clause 17.1.1 in relation to Boots. The Executive’s continuity of employment is preserved and all references to Alliance UniChem Plc contained in the Service Agreement shall be construed as references to Alliance Boots plc in the New Service Agreement. |
/s/ Marco Pagni
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For Alliance Boots plc
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/s/ Marco Pagni
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For Alliance UniChem Plc
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/s/ George R. Fairweather
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GEORGE ROLLO FAIRWEATHER
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EMPLOYMENT AGREEMENT
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1. | ‘the Company’: Alliance UniChem Services Limited (registered number: 4611581) whose registered office is at 2 The Heights, Brooklands, Weybridge, Surrey, KT13 0NY ; |
2. | ‘the Executive’: Marco Pagni of [ADDRESS]. |
1. | Effect of certain words and expressions |
1.1 | Certain words and expressions have particular meanings in this Agreement. Please refer to Schedule 1. |
2. | Appointment |
2.1 | With effect from 15 th July 2003, in consideration of the mutual covenants and agreements herein, the Company appoints the Executive and the Executive agrees to act as Group Counsel & Company Secretary. The Executive agrees that the Company may at its discretion require him to perform, without additional remuneration, other lawful duties or reasonable tasks not specifically within the scope of his normal duties but consistent with his seniority and professional skills and the Executive agrees to perform those duties/tasks. The Company may appoint someone to act jointly with the Executive in the performance of his duties. |
2.2 | The Executive represents that he is free to take up this employment and is not subject to any restriction that might hinder or prevent the full performance of his duties. |
2.3 | The Executive’s continuous period of employment with the Company commenced on 15 th July 2003. |
3. | Hours of Work, Place of Work and Salary |
3.1 | The Executive’s hours of work shall be from 9.00am to 5.00pm, Monday to Friday. The Company shall, with effect from 1 st January 2005 pay the Executive a salary of £210,000 gross per year, paid on or about the 22 nd of each month in arrears. Salary includes any fees receivable by the Executive as officer, nominee or representative of the Company or any Group Company. No overtime pay will be paid for work outside normal hours. Salary will be reviewed annually. The Executive shall perform his duties at the head office from time to time of Alliance UniChem and may be required to travel abroad in the performance of his duties. |
3.2 | The limit on working time in regulation 4(1) of the Working Time Regulations 1998 will not apply to the Executive, unless the Executive or the Company gives to the other 3 months written notice to the contrary. |
4. | Discretionary Bonus |
4.1 | The Executive shall be eligible for a discretionary bonus determined by the Company in accordance with the Company’s discretionary bonus arrangements from time to time, such arrangements to be communicated to the Executive from time to time. No bonus is payable:- |
4.1.1 | during or in respect of any period: (a) whilst the Executive is suspended under clause 14.7 or (b) in which the Company exercises its rights under clause 14.8; |
4.1.2 | if on the date of payment the Executive’s employment has terminated (for any reason) or he is serving any notice period; |
4.1.3 | unless throughout the period in respect of which it is payable the Executive has been at work and performing his duties for the Company, save for authorised holiday. |
4.2 | Payment of bonus on one occasion shall not give rise to any right to or expectation of payment of any bonus thereafter. |
5. | Shares |
5.1 | Subject to clause 8, the Executive may be entitled to receive Share Options as the remuneration committee of Alliance UniChem may from time to time determine. |
6. | Pension |
6.1 | Subject to clause 8, the Executive shall be entitled to be and remain a member of the Defined Contribution Plan of the Alliance UniChem Group UK Pension Scheme. Further details of this scheme can be obtained from the Human Resources Department. |
7. | Insurance and Other Benefits |
7.1 | Subject to clause 8, the Executive shall be entitled to participate at the Company’s expense: |
7.1.1 | for his own benefit in the Company’s permanent health insurance scheme; and |
7.1.2 | for his own, his spouse’s and his dependant children’s benefit in the Company’s private medical expenses insurance scheme; and |
7.1.3 | for his own, his spouse’s and his dependant children’s benefit in the Company’s personal accident and travel insurance scheme. |
7.2 | Subject to clause 8: - |
7.2.1 | if the Executive is not a member of the Defined Contribution Plan referred to in clause 6.1, the Company will provide the Executive with a life assurance benefit equal to his basic pensionable salary at the date of his death; |
7.2.2 | if the Executive is a member of the Defined Contribution Plan referred to in clause 6.1, the Company will provide the Executive with a life assurance benefit equal to 3 times his basic pensionable salary at the date of his death. |
8. | Provisions applicable to clauses 5, 6 and 7 |
8.1 | The Executive’s entitlement (if any) to be a member of, receive benefits and/or subscribe for shares under the Share Options, Defined Contribution Plan, life assurance and other schemes referred to in clauses 5, 6 and 7 (“the Schemes”) is subject to all rules and terms and conditions of the relevant Scheme from time to time in force and as the same may be varied and/or replaced by the Company (or Alliance UniChem, in the case of the Share Options) and/or the provider of the relevant benefit. Further details regarding the Schemes are available from the Company. Reference to “the Schemes” includes the same as varied and/or replaced from time to time. |
8.2 | The Company (or Alliance UniChem, in the case of the Share Options) is entitled:- |
8.2.1 | to terminate all or any of the Schemes (with or without any replacement) and/or to replace the provider of and/or the nature or type of any benefits provided thereunder; |
8.2.2 | to terminate the Executive’s employment notwithstanding that such termination may result in the Executive ceasing to be entitled to and/or being entitled only to reduced benefits under the Schemes. |
9. | Car |
9.1 | The Executive’s entitlement to be provided with a car is set out in the Company Car Policy, a copy of which is available from the Company. |
9.2 | Subject to the Company Car Policy, the Company shall bear all insurance costs standing and running expenses of the car with the exception of the cost of fuel and recovery where the car is used outside the United Kingdom for private purposes. |
10. | Expenses |
10.1 | Subject to the Company’s guidelines in relation to reimbursement of expenses, the Company shall reimburse to the Executive expenses reasonably incurred by him in the proper performance of his duties. |
10.2 | Any Company sponsored credit or charge card shall be used only for expenses reimbursable under clause 10.1 and shall be returned to the Company when requested. |
11. | Holiday |
11.1 | The Executive is entitled to 30 working days paid holiday in each holiday year to be taken at such time or times as are agreed with the person to whom the Executive reports. |
12. | Incapacity |
12.1 | If the Executive is prevented by illness injury or other incapacity from properly performing his duties he shall comply with the notification and certification procedure detailed in Section V of the Handbook. |
12.2 | If the Executive complies with clause 12.1, he will be paid his full remuneration hereunder for up to 180 working days’ absence in any period of 12 consecutive months. The Executive will not be entitled to any other remuneration and any amounts paid in addition shall be entirely discretionary and if paid may be terminated at any time. All such remuneration will be inclusive of any Statutory Sick Pay or other benefits recoverable by the Executive. |
13. | Intellectual Property Rights |
13.1 | The Executive acknowledges that all intellectual property rights (including copyright and designs) of any nature made or developed by him at any time in the course of his employment with the Company (whether alone or with others, whether or not made during normal working hours and whether before or after the date of this Agreement) belong to and vest in the Company absolutely to the fullest extent permitted by law. The Executive further agrees to perform, without charge, all acts that may be required to perfect the Company’s legal rights in any such intellectual property. |
14. | Covenants during employment and confidential information |
14.1 | The Executive agrees that during his employment he will not:- |
14.1.1 | (subject as otherwise provided in this clause 14.1.1) have any Material Interest in any other business and including in any business which is in competition (in whole or in part) with any business carried on by the Company or any Group Company and/or which may require the disclosure or use of Confidential Information. The Executive may have a Material Interest in another business (which is not in competition, as aforesaid, and will not require the disclosure or use of Confidential Information), if he obtains the prior written consent of the Company, such consent not to be unreasonably withheld; |
14.1.2 | other than for the proper performance of the Executive’s duties remove from the Company’s and/or any Group Company’s premises or copy or allow others to remove or copy any Confidential Information or any other information which belongs to or relates to the businesses of the Company or any Group Company; |
14.1.3 | directly or indirectly (on his own behalf or on behalf of any other person) solicit or entice away any employee or consultant of the Company or any Group Company, or discourage any prospective employee or consultant from being employed or engaged by the Company or by any Group Company; |
14.1.4 | directly or indirectly (on his own behalf or on behalf of any other person) solicit the business or custom of any past current or prospective customer or supplier of the Company and/or any Group Company; |
14.1.5 | directly or indirectly (on his own behalf or on behalf of any other person) provide services and/or products to any past current or prospective customer of the Company and/or of any Group Company. |
14.2 | The Executive shall not during his employment save only in the proper performance of his duties directly or indirectly disclose to any person or use any Confidential Information and the Executive shall use all due care and diligence to prevent any loss, unauthorised disclosure or use of any Confidential Information. |
14.3 | The Executive shall not at any time after the termination of his employment directly or indirectly disclose to any person or make any use of any Confidential Information. |
14.4 | Nothing in this Agreement will prevent the disclosure or use of Confidential Information pursuant to an order of a court of competent jurisdiction or regulatory body with powers to compel disclosure. |
14.5 | Neither the Executive (nor any person in whom the Executive has a Material Interest) shall receive any money or other benefit from any customer or supplier of the Company or of any Group Company, which is in excess of £100 in value. The Executive will immediately advise the Company if any such money or other benefit in excess of ₤100 in value is received. |
14.6 | Nothing in this Agreement shall be taken to mean that the Company is obliged to provide the Executive with any work or that the Executive is entitled to perform work for the Company and/or any Group Company. |
14.7 | The Company shall be entitled at any time and from time to time to suspend the Executive and require the Executive not to attend work for such period as the Company, acting reasonably, may specify in order to investigate a suspected disciplinary matter or for any other reason considered appropriate by the Company (acting reasonably). |
14.8 | At any time during a notice given by either party to terminate the Executive’s employment and at any time during this Agreement (in particular if the Executive purports to terminate his employment in breach of this Agreement) and for a period not exceeding 6 months:- |
14.8.1 | the Company may in its absolute discretion elect not to provide the Executive with any work (and the Executive shall have no right to perform any work) and the Company may in its absolute discretion require the Executive to perform such duties (if any) commensurate with the Executive’s role as it thinks fit during normal working hours; and |
14.8.2 | the Company may in its absolute discretion exclude the Executive from its premises and the premises of any Group Company and may direct the Executive to cease all contact with any customers, suppliers, contractors or employees of the Company or any Group Company. |
14.9 | The Executive shall at all times when rights are exercised under clause 14.8 remain readily accessible and available for work and otherwise comply with this Agreement and in particular this clause 14. |
14.10 | The exercise by the Company of any rights under clause 14.8 shall not constitute a breach of this agreement of any kind whatsoever in respect of which the Executive has any claim against the Company. The Company’s rights under clause 14.8 are without prejudice to any other rights and remedies available to the Company. |
14.11 | Throughout any period in which the Company exercises its rights under clause 14.8 the Executive shall continue to receive salary and other contractual benefits (but subject to clause 4.1.1), provided that if the Executive is not accessible and available for work, all rights to salary and other benefits in respect of the period of non-availability shall be forfeited. |
15. | Termination of agreement |
15.1 | Subject to clauses 15.2 and 15.3 this Agreement may be terminated: |
15.1.1 | by the Company giving the Executive not less than 6 months prior written notice; or |
15.1.2 | by the Executive giving the Company not less than 6 months prior written notice. |
15.2 | The Company has rights to terminate the Executive’s employment as set out in the Handbook (eg for gross misconduct). In addition, the Company may terminate this Agreement (without notice or payment in lieu of notice) if the Executive: |
15.2.1 | fails or neglects to discharge his duties effectively and diligently or to carry out all lawful directions of the Chief Executive of Alliance UniChem and/or the Executive’s business unit Managing Director or General Manager; |
15.2.2 | commits any act of dishonesty or any act which may bring the Company into disrepute; |
15.2.3 | becomes bankrupt or makes any arrangement or composition with his creditors generally; or |
15.2.4 | becomes of unsound mind or a patient under the Mental Health Act 1983 or has been admitted to a hospital in pursuance of an application made under that Act; or |
15.2.5 | contravenes any model code or relevant legislation or regulatory rules from time to time applicable to directors and/or employees of the Company and/or any Group Company. |
15.3 | This Agreement shall automatically terminate (without notice or payment in lieu of notice): |
15.3.1 | on the Executive reaching his retirement age being his 65th birthday; or |
15.3.2 | if the Executive is, at the relevant time, a director of the Company or any Group Company and the Executive ceases to hold such office of director because: |
(a) | he becomes prohibited by law or any market regulation from being a director; or |
(b) | he resigns such office of director; or |
(c) | he is required to vacate such office of director pursuant to the Articles of Association of the Company or Group Company or if the Executive is duly removed from his office of director. |
15.4 | Notwithstanding clauses 12.2 and 15.1 to 15.3, the Company may terminate this Agreement by not less than 3 months’ prior notice if the Executive is incapacitated by ill-health or accident from performing his duties under this Agreement for a period or periods aggregating more than 180 working days in the preceding 12 months. |
15.5 | On the giving of notice to terminate the Executive’s employment or at any time during any notice period, the Company may in its absolute discretion (but is not obliged to) terminate the Executive’s employment immediately by making a payment to the Executive in lieu of the Executive’s basic salary under clause 3.1 (net of tax and national insurance) for the unexpired portion of the notice period. |
15.6 | On the termination of this Agreement for whatever reason, the Executive shall at the request of the Company: |
15.6.1 | resign from all and any offices which he may hold as a director, nominee or representative of the Company or any Group Company; and |
15.6.2 | transfer without payment to the Company or as the Company may direct any shares held by him as a nominee of the Company or any Group Company, |
16. | Obligations after employment |
16.1 | The Executive shall not during the Restricted Period directly or indirectly: |
16.1.1 | hold any Material Interest in any business which is or shall be wholly or partly in competition with the Businesses in the Restricted Area including (to the extent that the same carry on a business in the Restricted Area which is competitive with the Businesses) those persons listed in Schedule 2 and their respective parent undertakings, subsidiary undertakings, subsidiaries, holding and associated companies (as defined in sections 258, 736 and 736A of the Companies Act 1985 and s.52 Companies Act 1989); |
16.1.2 | hold any Material Interest in any person, which requires him to disclose or make use of any Confidential Information. |
16.2 | The Executive shall not directly or indirectly whether as a principal, employee, partner, director, consultant, sub-contractor, shareholder or otherwise howsoever on his own behalf or on behalf of any other person during the Restricted Period in competition with the Company and/or any Group Company: |
16.2.1 | solicit any business, orders or custom for any Products or Services from any Customer; |
16.2.2 | solicit any business, orders or custom for any Products or Services from any Potential Customer; |
16.2.3 | accept any business orders or custom for any Products or Services from any Customer; |
16.2.4 | accept any business orders or custom for any Products or Services from any Potential Customer; |
16.2.5 | take such steps as may interfere with the continuance of supplies to the Company and/or any Group Company by any supplier; |
16.2.6 | solicit or entice away or seek to solicit or entice away from the Company or any Group Company (or knowingly assist or procure any other person to do so) any Employee or Contractor and whether or not such person would breach his or her contract of employment or engagement by reason of leaving the service of the Company or a Group Company as the case may be; |
16.2.7 | engage (or knowingly assist or procure any other person to engage) any Employee or Contractor. |
16.3 | The Executive shall not directly or indirectly whether as principal, employee, partner, director, consultant, sub-contractor, shareholder or otherwise howsoever on his own behalf or on behalf of any other person:- |
16.3.1 | at any time after the Termination Date induce or seek to induce by any means involving the disclosure or use of Confidential Information any Customer or any other customer or any supplier to cease dealing with, reduce its business with or vary or restrict the terms on which it will deal with the Company or any Group Company; |
16.3.2 | at any time after the Termination Date represent himself or permit himself to be held out by any person as being in any way connected with or interested in the Company or any Group Company (save as the holder of shares if such be the case). |
16.4 | The Executive acknowledges that any and all of his relationships from time to time with customers of the Company and/or any Group Company are the property of the Company and/or its Group Companies and that he has no interest, right or entitlement to maintain particular relationships or accounts with any particular customer of the Company and/or its Group Companies and that the Company or its Group Companies shall be entitled in its sole discretion from time to time (including during any period of notice) to require the Executive to terminate any or all such relationships, hand over any or all such relationships or accounts to persons nominated by the Company or its Group Companies (including to other employees of the Company or its Group Companies) and/or to seek to generate and maintain relationships or accounts with other existing or new customers. |
16.5 | The parties agree that the restrictions contained in clauses 14 and 16 are without prejudice to any other duties (fiduciary or otherwise) owed to the Company or any Group Company and are reasonable and necessary for the protection of legitimate interests of the Company and each Group Company and that, having regard to those interests, those restrictions do not work unreasonably on the Executive. It is nevertheless agreed that if any of those restrictions shall taken together or separately be held to be void or ineffective for any reason but would be held to be valid and effective if any restriction or restrictions or part of the wording were deleted then the said restriction shall apply with such deletions as may be necessary to make the same valid and effective. |
16.6 | The restrictions contained in each sub-clause of clauses 14 and 16 shall be construed as separate and individual restrictions and shall each be capable of being severed without prejudice to the other restrictions or to the remaining provisions of this Agreement. |
16.7 | The Executive has given the undertakings contained in clauses 14 and 16 to the Company for itself and as trustee for each Group Company and the Executive will at the request and cost of the Company enter into direct undertakings with any Group Company which correspond to the undertakings in clauses 14 and 16, or which are less onerous only to the extent necessary (in the opinion of the Company or its legal advisors) to ensure that such undertakings are valid and enforceable. |
16.8 | If the Company transfers all or any part of its business to a third party (“the transferee”), the restrictions contained in clauses 14 and 16 shall, with effect from the Executive becoming an employee of the transferee, apply to the Executive as if references to the Company included the transferee and references to any Group Company were construed accordingly and as if references to customers were to customers of the Company and/or the transferee and their respective Group Companies. |
17. | Data Protection |
17.1 | The Executive agrees that by signing this Agreement, he has given consent to the Company processing personal data concerning the Executive in order to properly fulfil its obligations to the Executive under the Executive’s employment and as otherwise required by law in relation to the Executive’s employment in accordance with the Data Protection Act 1998 (“the DPA”). Such processing will principally be for personnel, administrative and payroll purposes. |
17.2 | The Executive acknowledges that, if the Executive is required at any time to work on behalf of the Company or a Group Company overseas, the Company may need to pass the Executive’s personal data to the person with whom it is working anywhere in the world and the Executive consents to the Company doing so. |
17.3 | In the event that the Company or any Group Company needs to process any “sensitive personal data” (as defined by the DPA) in relation to the Executive for its legitimate business needs, the Executive undertakes to sign on request such express consents as may be required to enable it to do so. |
18. | General |
18.1 | The Handbook forms part of the terms and conditions of the Executive’s employment. This Agreement and the Handbook (and other matters referred to in the Handbook as having contractual effect) constitute the entire employment contract between the Company and the Executive and supersede and replace: (a) any and all previous terms and conditions of employment or for services between the Company or any Group Company and the Executive (all of which shall be deemed to have terminated with immediate effect by mutual consent, but without prejudice to any liability for any prior breach) and (b) the terms of any offer letter or other correspondence between the Executive and the Company relating to the Executive’s employment, If there are any inconsistencies between the provisions of this Agreement and the Handbook, the provisions of this Agreement shall prevail. |
18.2 | This Agreement and the Handbook set out all the salary and other benefits to which the Executive is entitled. Any other benefits provided are non-contractual and if provided are provided in the absolute discretion of the Company and may be withdrawn at any time. |
18.3 | The expiration or termination of this Agreement shall not affect the provisions of this Agreement as expressly or by implication are intended to have effect after that time and shall be without prejudice to any accrued rights or remedies of the parties. |
18.4 | The Company and the Executive agree that the Company may at any time on written notice to the Executive assign the benefit and the burden of this Agreement to another person being a Group Company at the time of such assignment. In so far as permitted by law, the Executive hereby waives any right or rights he may have, whether statutory or otherwise, to object to the Executive being employed by such new employer. |
18.5 | The disciplinary and grievance procedures which apply to the Executive are contained in the Handbook, a copy of which has been provided to the Executive. The Handbook also specifies the procedures applicable to the taking of disciplinary actions and any decision to dismiss the Executive. |
18.6 | If the Executive is dissatisfied with any disciplinary decision relating to him or wishes to appeal any decision to dismiss him or if the Executive has any grievance relating to his employment this must be raised with the Executive’s manager or any person senior to him (either orally or in writing). The further steps in relation thereto are explained in the Handbook. |
18.7 | Nothing in this Agreement or otherwise will affect any statutory dispute resolution procedures which the law requires the Company to comply with. The relevant provisions of the Handbook will apply to the extent that they are additional to and not inconsistent with the requirements of any such statutory procedure. |
18.8 | The existence, effect and interpretation of this Agreement shall be governed by the laws of England and the parties submit to the exclusive jurisdiction of the courts of England. |
1.1
|
In this Agreement:
|
‘Alliance UniChem’
|
means Alliance UniChem Plc (registered number 2517178)
|
‘the Board’
|
means the Board of Directors of Alliance UniChem from time to time and includes any committee of the Board duly appointed by it
|
‘Businesses’
|
means all commercial activities of the Company or any
|
(a)
with which the Executive shall have been concerned or involved at any time during the period of 12 months ending on the Termination Date; or
|
|
(b)
in respect of which the Executive possess Confidential Information; or
|
|
(c)
which the Company or any Group Company shall at the Termination Date have determined to carry on or take any ownership interest in, in the immediate or foreseeable future and in relation to which the Executive shall at the Termination Date possess any Confidential Information
|
|
’Company Car Policy’
|
means the Alliance UniChem Plc & UK Subsidiary Companies Company Car Policy of January 2004, as from time to time amended and/or replaced
|
‘Confidential Information’
|
means all confidential and/or trade secret information of the Company and/or any Group Company (whether or not recorded in any permanent or written form and whether or not marked as confidential) including marketing information, information relating to planned products/services, sales and pricing information, information relating to customers/suppliers (including names, contact details and actual or proposed business), financial corporate and strategic information, business projections and targets, business methods or plans, technical information, know how, inventions, research and development information and other information in respect of which the Company or any Group Company owes an obligation of confidentiality to any third party, but shall not include any information which is in or comes into the public domain otherwise than as a result of any unauthorised disclosure by the Executive or any other person who owes the Company and/or any Group Company an obligation of confidentiality in relation to the information disclosed
|
‘Customer’
|
means any customer of the Company or of any Group Company:-
|
(a)
with whom the Executive has directly or indirectly dealt in the period of 12 months prior to the Termination Date; or
|
|
(b)
in respect of whom the Executive had knowledge of Confidential Information at the Termination Date; or
|
|
c)
in respect of whom the Executive had as a result of his employment relationship developed a business relationship.
|
|
“Employee or Contractor”
|
means any person who is and was at the Termination Date employed or engaged (as an employee or self-employed contractor) by the Company or any Group Company to work in any of their businesses:-
|
(a)
at the same level as the Executive; or
|
|
(b)
whose total remuneration package (including salary bonus (contractual or discretionary) commission and all benefits in kind) was equal to or more than £50,000 (gross) in the period of 12 months prior to the Termination Date;
|
|
‘Group Company’
|
means any company which is from time to time an associate company of the Company within the meaning of s52 Companies Act 1989
|
‘Handbook’
|
means the Alliance UniChem Staff Handbook, as from time to time amended or replaced
|
‘Material Interest’
|
means:
|
(a)
the holding of any position as director, officer, employee, consultant, partner, sub-contractor, principal or agent; or any other position in or control over any person which enables the Executive directly or indirectly to exercise influence;
|
|
(b)
the direct or indirect control or ownership (whether jointly or alone) of any shares (or any voting rights attached to them) or debentures save for the ownership for investment purposes only of not more than 1 per cent of the issued ordinary shares of any company whose shares are listed on any recognised investment exchange (as defined in section 285 of the Financial Services and Markets Act 2000)
|
‘Potential Customer’
|
means any person with whom during the period of 6 months prior to the Termination Date the Company or any Group Company was in negotiation for the provision of Products or Services if the Executive had been directly or indirectly concerned in such negotiations and/or in respect of which negotiation the Executive had knowledge of Confidential Information at the Termination Date
|
‘Products’
|
means products in the range of products supplied by the Company or any Group Company in the period of 12 months prior to the Termination Date
|
‘Restricted Area’
|
means England, Scotland, Wales, Northern Ireland, Eire, the Channel Islands, France, Italy, Spain, Portugal, Holland, Norway, Switzerland, the Czech Republic, Turkey, Egypt, Germany, or any other country in which the Company or any Group Company has at the Termination Date a material business interest or is at the Termination Date planning to take a material business interest within 12 months of the Termination Date
|
‘Restricted Period’
|
means 12 months from the Termination Date less any period in which the Company has enforced its rights pursuant to clause 14.8
|
‘Services’
|
means services in the range of services supplied by the Company or any Group Company in the period of 12 months prior to the Termination Date
|
‘Share Options’
|
means options to subscribe for ordinary shares of ten pence each in the capital of Alliance UniChem, pursuant to the Alliance UniChem 1997 Share Option Scheme as adopted on 21
st
May 1997 and amended on 7
th
March 2003 and as from time to time amended or replaced
|
‘Termination Date’
|
means the date of termination of the Executive’s employment with the Company.
|
1.2 | In this Agreement any phase introduced by the terms “including”, “include”, “in particular” or any similar expression shall be construed as illustrative and shall not limit the sense of the words preceding those terms. |
SIGNED
by:
|
SIGNED
by
|
/s/ Marco Pagni
|
/s/ Graham Wharton |
Marco Pagni
|
Graham Wharton
|
For and on behalf of Alliance UniChem Services Ltd
|
/s/ Frank Standish
|
SERVICE AGREEMENT
|
1. | Effect of certain words and expressions |
1.1 | Certain words and expressions have particular meanings in this Agreement. Please refer to Schedule 1. |
2. | Appointment |
2.1 | At all times during the continuance of this Agreement you shall: |
2.1.1 | devote the whole of your working time and attention to the duties of the Appointment assigned to you from time to time; |
2.1.2 | use your best endeavours to promote and protect the interests of the Company and all Group Companies; |
2.1.3 | faithfully and diligently serve the Company and perform such duties and exercise such powers as may from time to time be assigned to or vested in you; |
2.1.4 | obey all reasonable and lawful directions given to you by or under authority of the Board; |
2.1.5 | make such reports to the Board on any matters within your knowledge concerning the affairs of the Company or any Group Company as are reasonably required. |
2.2 | You shall be a director of the Company and: |
2.2.1 | shall hold such Office as the Company may from time to time reasonably require; |
2.2.2 | (if the Company so requests and in any event on termination of the Appointment) shall immediately resign without claim for compensation from any Office held in the Company and/or any Group Company (but without prejudice to any rights you may have to claim compensation in respect of termination of the Appointment); |
2.2.3 | shall not do anything that would cause you to be disqualified from holding any Office; |
2.2.4 | shall not (without the prior written approval of the Board) resign from any Office which you hold in the Company or any Group Company or any trusteeship which you hold as a result of the Appointment; |
2.3 | You hereby warrant that you are free to take up this employment and are not subject to any restriction that might hinder or prevent the full performance of your duties. |
2.4 | Your continuous period of employment with the Company commenced on 28 July 1980. |
3. | Hours of Work, Place of Work and Salary |
3.1 | You shall work such hours as are reasonably necessary for the proper performance of your duties. |
3.2 | The Company shall, with effect from the Commencement Date, pay you a basic salary of £395,000 per year, paid by direct credit transfer to your nominated bank or building society on or around the 20 th of each calendar month in arrears. Such basic salary includes any fees receivable by you as Officer, nominee or representative of the Company or any Group Company. You shall not be entitled to any directors’ fees in addition to your basic salary. Your basic salary will be reviewed annually but the Company will be under no obligation to award an increase. The Company reserves the right to make deductions from your basic salary or other payments owed to you in order to recover any overpayments made to you in error. |
3.3 | Subject to clause 3.4, you shall perform your duties at the Company’s Nottingham Support Office and you may be required to travel within the UK or abroad from time to time in the performance of your duties. |
3.4 | Due to the nature of the Company’s business and the work you will be required to do, the Company may from time to time, on giving you reasonable notice, require you to work on a temporary or permanent basis at any of its offices or those of its Group Companies. The Company will pay your reasonable expenses incurred in connection with any temporary or permanent relocation. |
3.5 | Because of the autonomous nature of your role, the duration of your working time is not measured, monitored or determined by the Company and the limit on weekly working time set out in Regulation 4 of the Working Time Regulations 1998 does not apply to your employment. |
4. | Discretionary Bonus |
4.1 | You may be eligible to participate in certain discretionary bonus schemes determined by the Company in accordance with the Company’s discretionary bonus arrangements announced and communicated to you from time to time. In the event that the Company decides to operate any bonus scheme from time to time in which you are eligible to participate, no bonus is payable: |
4.1.1 | during or in respect of any period: (a) whilst you are suspended under clause 13.2 or (b) in which the Company exercises its rights under clause 13.3; or |
4.1.2 | if on the date of payment your employment has terminated (for any reason) or you are serving any notice period (whether such notice has been given by you or the Company). |
4.2 | Payment of bonus on one occasion shall not give rise to any right to or expectation of payment of any bonus thereafter. |
4.3 | Announcement of a bonus scheme on one occasion shall not give rise to any right to or expectation of an announcement of any bonus scheme or schemes thereafter. |
5. | Pension |
5.1 | The Company operates the Pension Scheme. You are eligible to continue to be a member of the Pension Scheme subject to the consent of the trustees of the Pension Scheme, the rules of the Pension Scheme (as may be amended from time to time) and Inland Revenue permitted limits. A copy of the rules of the Pension Scheme may be obtained from the Pensions Department. |
5.2 | There is a contracting out certificate in force in relation to your employment in respect of this Agreement under the provisions of the Pension Schemes Act 1993. |
6. | Car |
6.1 | You are entitled to be provided with a car on the terms set out in the Company Car Policy in force and as amended from time to time, a copy of which is available from Human Resources. |
7. | Expenses |
7.1 | Subject to the Company’s guidelines in relation to reimbursement of expenses, the Company shall reimburse expenses reasonably incurred by you in the proper performance of your duties. |
7.2 | Any Company sponsored credit or charge card shall be used only for expenses reimbursable under clause 7.1 and shall be returned to the Company when requested. |
8. | Holiday |
8.1 | In addition to statutory holidays, you are entitled to take 30 working days holiday in each holiday year to be taken at such time or times as are agreed with the Board. |
8.2 | The holiday year is 1 st April to 31 st March. |
8.3 | You will forfeit any accrued but untaken holiday which has not been taken at the end of the holiday year but you will be entitled to carry forward up to one week’s accrued but untaken holiday into the next holiday year with the agreement with the Board. |
8.4 | If your employment is terminated for whatever reason during a holiday year, other than in accordance with clause 12.2, your holiday entitlement will be calculated as being 1/12 th of your annual holiday entitlement for each completed calendar month worked prior to termination. |
8.5 | The Company reserves the right to deduct any amount of holiday pay paid in excess of accrued entitlement from any sums due at termination or to require the reimbursement of any such amounts. |
8.6 | If either party serves notice to terminate this Agreement, the Company may require you to take any accrued but unused holiday entitlement during the notice period (whether or not you are on Garden Leave). |
8.7 | Further details regarding your holiday entitlement are set out in the Employee Handbook. |
9. | Illness, injury or incapacity |
9.1 | If you are prevented by illness injury or other incapacity from properly performing your duties, you must comply with the notification and certification procedure detailed in the Employee Handbook. |
9.2 | Information relating to the Company’s non-contractual and discretionary Company Sick Pay scheme is contained within the Employee Handbook. |
9.3 | In the event that you are unable to attend work due to illness or injury because of the actionable negligence of a third party in respect of which damages are recoverable, you shall advise the Company forthwith and all payments made by the Company to you during such incapacity shall constitute a loan to you to the extent that any compensation recovered from the third party shall be repaid by you to the Company. |
9.4 | If you are absent from work due to illness, injury or incapacity for a consecutive period of 90 working days the Company may (without prejudice to the provisions of clause 2.1) appoint another person or persons to perform your duties until you return to work. |
10. | Intellectual Property Rights |
10.1 | If whilst you are employed by the Company (whether or not in the course of your duties) you, whether alone or jointly, make or develop or modify any Intellectual Property in connection with or relating to or capable of being used or adapted for use in the business of the Company or any Group Company: |
10.1.1 | all rights to the Intellectual Property which subsist (or which may in the future subsist) will on creation, rest in and be the exclusive property of the Company; |
10.1.2 | to the extent necessary to vest the Intellectual Property in the Company and subject to section 42 of the Patents Act 1977, you hereby assign to the Company all rights to the Intellectual Property, whether future or subsisting, for the full term throughout the world. |
10.2 | Where you alone or jointly make or develop or modify any Intellectual Property, you shall promptly disclose to the Company full details of the Intellectual Property and shall not disclose the Intellectual Property to any third party before so doing. |
10.3 | You shall maintain adequate written records and memoranda of all Intellectual Property and these will remain the sole property of the Company and: |
10.3.1 | you shall, at the request and expense of the Company, do everything necessary to enable the Company or its nominee to obtain the benefit of the Intellectual Property including, without limitation, securing patent or other protection in the United Kingdom or any part of the world; and |
10.3.2 | you waive any rights you may have in respect of the Intellectual Property under sections 77 to 86 of the Copyright, Designs and Patents Act 1988, including the right to object to derogatory treatment. |
11. | Covenants during employment and confidential information |
11.1 | You agree that during your employment you have a general duty to act in good faith with respect to the Company. |
11.2 | You agree that during your employment you will not: |
11.2.1 | (subject as otherwise provided in this sub-clause 11.2.1) have any Material Interest in any other business and including in any business which is in competition (in whole or in part) with any business carried on by the Company or any Group Company and/or which may require the disclosure or use of Confidential Information. You may have a Material Interest in another business (which is not in competition, as aforesaid, and will not require the disclosure or use of Confidential Information) if you obtain the prior written consent of the Company, such consent not to be unreasonably withheld; |
11.2.2 | other than for the proper performance of your duties remove from the Company’s and/or any Group Company’s premises or copy or allow others to remove or copy any Confidential Information or any other information which belongs to or relates to the Businesses of the Company or any Group Company; |
11.2.3 | directly or indirectly (on your own behalf or on behalf of any other person) solicit or entice away any employee or consultant of the Company or any Group Company, or discourage any prospective employee or consultant from being employed or engaged by the Company or by any Group Company; |
11.2.4 | directly or indirectly (on your own behalf or on behalf of any other person) solicit the business or custom of any past current or prospective customer or supplier of the Company and/or any Group Company; |
11.2.5 | directly or indirectly (on your own behalf or on behalf of any other person) provide services and/or products to any past current or prospective customer of the Company and/or of any Group Company. |
11.3 | You shall not during your employment save only in the proper performance of your duties directly or indirectly disclose to any person or use any Confidential Information and you shall use all due care and diligence to prevent any loss, unauthorised disclosure or use of any Confidential Information. |
11.4 | You shall not during your employment directly or indirectly make publish or otherwise communicate any disparaging or derogatory statements whether in writing or otherwise concerning the Company or any Group Company, their officers, consultants, agents, shareholders, employees, suppliers or customers. |
11.5 | You shall not at any time after the Termination Date directly or indirectly disclose to any person or make any use of any Confidential Information. |
11.6 | Nothing in this Agreement will prevent the disclosure or use of Confidential Information pursuant to an order of a court of competent jurisdiction or regulatory body with powers to compel disclosure, provided that you shall, unless prohibited by law, give the Company as much notice as is reasonably practicable if: |
11.6.1 | any application is made to a court of which you are aware which relates to Confidential Information. You shall also, unless prohibited by applicable law, notify the Company of the making of any such court order; |
11.6.2 | any regulatory body has requested disclosure of Confidential Information by you; and |
11.6.3 | unless prohibited by applicable law, you shall consult with the Company prior to making any disclosure pursuant to any court order and/or requirement of a regulatory body and take steps reasonably required by the Company to disclose Confidential Information in a manner reasonably designed to preserve its confidential nature as far as reasonably practicable. |
11.7 | Neither you (nor any person in whom you have a Material Interest) shall without the prior consent of the Company receive any money or other benefit from any customer or supplier of the Company or of any Group Company, which is in excess of £100 in value. You will immediately advise the Company if any such money or other benefit in excess of £100 in value is received. |
11.8 | You agree that you will abide by the Company’s Code of Conduct in force and as amended form time to time, a copy of which is set out in the Employee Handbook and is also available from Human Resources. |
12. | Termination |
12.1 | Subject to clauses 12.2, 12.3 and 12.4, your employment may be terminated: |
12.1.1 | by the Company giving you not less than 12 months’ prior written notice; or |
12.1.2 | by you giving the Company not less than 12 months’ prior written notice. |
12.2 | The Company may terminate your employment without notice or payment in lieu of notice on grounds of gross misconduct. In the event of termination effected in accordance with this clause 12.2, you will have no entitlement to any bonus and payment in respect of any accrued but untaken holiday will be limited to a maximum payment of £10 (gross). The Company will be entitled to adjust any salary owed to you accordingly. |
12.3 | The Company may also terminate your employment without notice or payment in lieu of notice if you: |
12.3.1 | seriously fail or neglect to discharge your duties effectively and diligently or to carry out all lawful directions of the Company and/or your line manager; |
12.3.2 | commit any act of dishonesty or any other act which may bring the Company into disrepute; |
12.3.3 | become bankrupt or make any arrangement or composition with your creditors generally; or |
12.3.4 | seriously contravene any model code or relevant legislation or regulatory rules from time to time applicable to directors and/or employees of the Company and/or any Group Company. |
12.4 | Your employment shall automatically terminate without notice or payment in lieu of notice: |
12.4.1 | upon you reaching retirement age being your 65 th birthday; or |
12.4.2 | if you are, at the relevant time, a director of the Company or any Group Company and you cease to hold such office of director because you: |
(a) | become prohibited by law or any market regulation from being a director; or |
(b) | resign such office of director; or |
(c) | are required to vacate such office of director pursuant to the Articles of Association of the Company or Group Company or if you are duly removed from your office of director. |
12.5 | On the giving of notice to terminate your employment or at any time during any notice period, the Company may in its absolute discretion (but is not obliged to) terminate your employment immediately by making a payment to you in lieu of your basic salary under clause 3.2 (less such deductions as the Company is required to make by law or as authorised by you (pursuant to the terms of this Agreement or otherwise) for any unexpired portion of the notice period. Such payment in lieu of notice will be made to you in equal monthly instalments, commencing in the calendar month immediately after the Termination Date, until such time as you secure alternative employment or the notice period to which the instalments relate expires (whichever is earlier), subject to you providing to the Board such evidence as it may reasonably require on a monthly basis to show that you are making reasonable endeavours to secure alternative employment. You will not, however, be obliged to accept alternative employment which is not appropriate to your status and skills. In the event that you do secure alternative employment but at a lower basic salary, then subsequent instalments shall be reduced by an amount equivalent to such lower basic salary, provided that the remuneration arrangements agreed by you with your new employer are appropriately balanced between basic salary and other benefits in accordance with market practice. In the absence of such evidence or if the Board is not reasonably satisfied that the evidence provided shows that you are making reasonable endeavours to secure alternative employment, the Company may cease making payment of the monthly instalments referred to in this clause after giving you one month’s written notice of such cessation and the reasons for it. In such circumstances, you will have no rights to any compensation whatsoever in respect of the loss of any further instalments of the payment in lieu of notice that would otherwise be due to you. For the purposes of this clause, “alternative employment” means any office, appointment, employment or self-employment under the terms of a contract of service or contract for services or otherwise. |
12.6 | On the termination of your employment for whatever reason, you shall at the request of the Company: |
12.6.1 | resign from all and any offices which you may hold as a director, nominee or representative of the Company or any Group Company; and |
12.6.2 | transfer without payment to the Company or as the Company may direct any shares held by you as a nominee of the Company or any Group Company, |
12.7 | On the termination of your employment (or earlier if requested by the Company) you shall immediately return to the Company all Confidential Information and all other information property equipment and materials of any nature (whether copies, originals or extracts) in your possession or control relating to the Company, any Group Company and/or any customer, supplier or contact of the Company and/or any Group Company (without keeping any copies) including relating to any Intellectual Property of the Company and/or any Group Company, any such information made or compiled by you, keys, correspondence, documents, files, papers, diagrams, books, records, security passes, computer disks, tapes, software, telephones and computers. In particular, if any information is held in electronic form, you shall (a) if the medium on which the same is stored belongs to the Company (and/or any Group Company) return that medium (with all such information) to the Company and (b) if the medium on which the same is stored belongs to you, provide a copy of all such information to the Company and when so requested to do so by the Company, permanently delete the same from the medium on which it is stored. |
12.8 | Where the Company exercises its rights pursuant to clause 13.3, you agree to comply forthwith with the provisions of clause 12.7 above. However, you shall not be obliged to return any property provided to you as a contractual benefit. |
12.9 | If so required by the Company, you shall on each occasion you are obliged to deliver up property or delete information pursuant to this clause 12 provide to the Company a signed statement identifying the property returned and confirming that you have fully complied with your obligations under this clause. |
13. | Suspension and Garden Leave |
13.1 | Nothing in this Agreement shall be taken to mean that the Company is obliged to provide you with any work or that you are entitled to perform work for the Company and/or any Group Company. |
13.2 | The Company shall be entitled at any time to suspend you and require you not to attend work for such period as the Company, acting reasonably, may specify in order to investigate a suspected disciplinary matter or for any other reason considered appropriate by the Company (acting reasonably). |
13.3 | At any time following a notice given by either party to terminate your employment and at any time during this Agreement and for a period not exceeding 12 months: |
13.3.1 | the Company may in its absolute discretion elect not to provide you with any work (and you shall have no right to perform any work) and/or the Company may in its absolute discretion require you to perform such duties (if any) commensurate with your role as the Company deems to be appropriate during your normal working hours; and |
13.3.2 | the Company may in its absolute discretion exclude you from its premises and the premises of any Group Company and may direct you to cease all contact with any customers, suppliers, contractors or employees of the Company or any Group Company. |
13.4 | You shall at all times when rights are exercised under clause 13.3 remain readily accessible and available for work and otherwise comply with this Agreement and in particular this clause 13. |
13.5 | The exercise by the Company of any rights under clause 13.3 shall not constitute a breach of this Agreement of any kind whatsoever in respect of which you have any claim against the Company. The Company’s rights under clause 13.3 are without prejudice to any other rights and remedies available to the Company. |
13.6 | Throughout any period in which the Company exercises its rights under clause 13.3, you shall continue to receive salary and other contractual benefits (but subject to clause 4.1.1), provided that if you are not accessible and available for work, all rights to salary and other benefits in respect of the period of non-availability shall be forfeited. |
14. | Disciplinary, grievance and appeals procedures |
14.1 | Information relating to the Company’s disciplinary, grievance and appeals procedures is contained within the Employee Handbook. |
15. | Security Rules |
15.1 | Information relating to the Company’s security rules is contained within the Employee Handbook. The Company also reserves the right to search all employees and vehicles on Company sites. |
16. | Obligations after employment |
16.1 | You shall not, during the Restricted Period, directly or indirectly: |
16.1.1 | hold any Material Interest in any business which is or shall be wholly or partly in competition with the Businesses in the Restricted Area including (to the extent that the same carry on a business in the Restricted Area which is competitive with the Businesses) those organisations listed in Schedule 2 and their respective parent undertakings, subsidiary undertakings, subsidiaries, holding and associated companies (as defined in sections 258, 736 and 736A of the Companies Act 1985 and section 52 of the Companies Act 1989); |
16.1.2 | hold any Material Interest in any organisation, which requires you to disclose or make use of any Confidential Information. |
16.2 | You shall not, directly or indirectly, whether as a principal, employee, partner, director, consultant, sub-contractor, shareholder or otherwise howsoever on your own behalf or on behalf of any other person during the Restricted Period in competition with the Company and/or any Group Company: |
16.2.1 | solicit any business, orders or custom for any Products or Services from any Customer; |
16.2.2 | solicit any business, orders or custom for any Products or Services from any Potential Customer; |
16.2.3 | accept any business orders or custom for any Products or Services from any Customer; |
16.2.4 | accept any business orders or custom for any Products or Services from any Potential Customer; |
16.2.5 | take such steps as may interfere with the continuance of supplies to the Company and/or any Group Company by any supplier; |
16.2.6 | solicit or entice away or seek to solicit or entice away from the Company or any Group Company (or knowingly assist or procure any other person to do so) any Employee or Contractor and whether or not such person would breach his or her contract of employment or engagement by reason of leaving the service of the Company or a Group Company as the case may be; or |
16.2.7 | engage (or knowingly assist or procure any other person to engage) any Employee or Contractor. |
16.3 | You shall not directly or indirectly whether as principal, employee, partner, director, consultant, sub-contractor, shareholder or otherwise howsoever on your own behalf or on behalf of any other person: |
16.3.1 | at any time after the Termination Date induce or seek to induce by any means involving the disclosure or use of Confidential Information any Customer or any other customer or any supplier to cease dealing with, reduce its business with or vary or restrict the terms on which it will deal with the Company or any Group Company; |
16.3.2 | at any time after the Termination Date represent yourself or permit yourself to be held out by any person as being in any way connected with or interested in the Company or any Group Company (save as the holder of shares if such be the case); or |
16.3.3 | at any time after the Termination Date make, publish or otherwise communicate any disparaging or derogatory statements whether in writing or otherwise concerning the Company or any Group Company, their officers, consultants, agents, shareholders or employees. |
16.4 | You acknowledge that any and all lists or data relating to any of your contacts from time to time with customers of the Company and/or any Group Company are the property of the Company and/or its Group Companies, and may constitute Confidential Information of the Company and/or any Group Company and that you have no interest, right or entitlement to maintain particular lists, data or accounts with any particular customer of the Company and/or its Group Companies. You shall not exploit your relationships with the customers of the Company and/or any Group Company except in the proper course of your duties for the Company. You agree that the Company or its Group Companies shall be entitled in their sole discretion from time to time (including during any period of notice) to require you to terminate any or all such relationships, hand over any or all lists or data relating to such relationships or accounts to persons nominated by the Company or its Group Companies (including to other employees of the Company or its Group Companies) and/or to seek to generate and maintain relationships or accounts with other existing or new customers. |
16.5 | The parties agree that the restrictions contained in clauses 11 and 16 are without prejudice to any other duties (fiduciary or otherwise) owed to the Company or any Group Company and are reasonable and necessary for the protection of legitimate interests of the Company and each Group Company and that, having regard to those interests, those restrictions do not work unreasonably on you. It is nevertheless agreed that if any of those restrictions shall taken together or separately be held to be void or ineffective for any reason but would be held to be valid and effective if any restriction or restrictions or part of the wording were deleted then the said restriction shall apply with such deletions as may be necessary to make the same valid and effective. |
16.6 | The restrictions contained in each sub-clause of clauses 11 and 16 shall be construed as separate and individual restrictions and shall each be capable of being severed without prejudice to the other restrictions or to the remaining provisions of this Agreement. |
16.7 | You acknowledge that if you breach any of your obligations contained in this Agreement (including those contained in clauses 11 and 16) then the Company may seek damages from you for any loss or damage suffered by the Company and/or any Group Company as a result of your breach. You also acknowledge and agree that damages alone would not be a sufficient remedy for any breach of clauses 11 and 16. |
16.8 | You have given the undertakings contained in clauses 11 and 16 to the Company for itself and as trustee for each Group Company and you will at the request and cost of the Company enter into direct undertakings with any Group Company which correspond to the undertakings in clauses 11 and 16, or which are less onerous only to the extent necessary (in the opinion of the Company or its legal advisers) to ensure that such undertakings are valid and enforceable. |
16.9 | if the Company transfers all or any part of its business to a third party (“the transferee”), the restrictions contained in clauses 11 and 16 shall, with effect from the date you become an employee of the transferee, apply to you as if references to the Company included the transferee and references to any Group Company were construed accordingly and as if references to customers were to customers of the Company and/or the transferee and their respective Group Companies. |
16.10 | On receipt of any offer of employment or any other offer of an engagement or arrangement made to you by any third party at any time during which any of the restrictions of this clause 16 are operative and/or which may give rise to a breach of any of your obligations under clause 11 or 16 you shall provide a copy of this Agreement to the relevant third party. |
17. | Data Protection |
17.1 | You agree that by signing this Agreement, you have given consent to the Company processing personal data concerning you in order to properly fulfil its obligations to you under your employment and as otherwise required by law in relation to your employment in accordance with the Data Protection Act 1998 (“the DPA”). Such processing will principally be for personnel, administrative and payroll purposes. |
17.2 | You acknowledge that, if you are required at any time to work on behalf of the Company or a Group Company overseas, the Company may need to pass your personal data to the person with whom you are working anywhere in the world and you consent to the Company doing so. |
17.3 | In the event that the Company or any Group Company needs to process any “sensitive personal data” (as defined by the DPA) in relation to you for its legitimate business needs, you undertake to sign on request such express consents as may be required to enable it to do so. |
18. | Collective agreements |
18.1 | There are no collective agreements in force in relation to your employment. |
19. | General |
19.1 | This Agreement and those parts of the Employee Handbook described as ‘Terms and Conditions of Employment’ constitute the entire employment contract between the Company and you and supersede and replace: (a) any and all previous terms and conditions of employment or for services between the Company or any Group Company and you (all of which shall be deemed to have terminated with immediate effect by mutual consent, but without prejudice to any liability for any prior breach); and (b) the terms of any offer letter or other correspondence between you and the Company relating to your employment. If there are any inconsistencies between the provisions of this Agreement and any other document, including the Employee Handbook, the provisions of this Agreement shall prevail. |
19.2 | This Agreement sets out all the salary and other benefits to which you are entitled. Any other benefits provided are non-contractual and if provided are provided in the absolute discretion of the Company and may be withdrawn or amended at any time. |
19.3 | The headings and sub-headings in this Agreement are for convenience only and do not affect its interpretation. |
19.4 | Any reference to a statutory provision shall be construed as a reference to any statutory modifications or re-enactment thereof (whether before or after the date hereof) for the time being in force. |
19.5 | The expiration or termination of this Agreement shall not affect the provisions of this Agreement as expressly or by implication are intended to have effect after that time and shall be without prejudice to any accrued rights or remedies of the parties. |
19.6 | The provisions of this Agreement are severable and distinct from one another and, if at any time any of the provisions is or becomes invalid, illegal or unenforceable, the validity, legality or enforceability of the other provisions shall not in any way be affected or impaired. |
19.7 | The parties agree that the Company may at any time on written notice to you assign the benefit and the burden of this Agreement to another person being a Group Company at the time of such assignment. Insofar as permitted by law, you hereby waive any right or rights you may have, whether statutory or otherwise, to object to being employed by such new employer. |
19.8 | Nothing in this Agreement shall confer or is intended to confer on any third party who is not a party to this Agreement any benefit or the right to enforce any provision of this Agreement pursuant to the Contracts (Rights of Third Parties) Act 1999. |
19.9 | The existence, effect and interpretation of this Agreement shall be governed by the laws of England and the parties submit to the exclusive jurisdiction of the courts of England. |
SIGNED
by:
|
SIGNED
by:
|
|
/s/ Alex Gourlay
|
/s/ Stefano Pessina
|
|
Alex Gourlay
|
Stefano Pessina
|
|
Executive Chairman of Alliance Boots
|
||
For and on behalf of Boots UK Limited
|
1.1 | In this Agreement: |
‘Appointment’ | means your employment by the Company on the terms of this Agreement. |
‘Board’ | means the board of directors from time to time of the Company (including any committee of the Board duly appointed by it). |
‘Businesses’ | means all commercial activities of the Company or any Group Company: |
(a) | with which you shall have been concerned or involved at any time during the period of 12 months ending on the Termination Date; or |
(b) | in respect of which you possess Confidential Information; or |
(c) | which the Company or any Group Company shall at the Termination Date have determined to carry on or take any ownership interest in, in the immediate or foreseeable future and in relation to which you shall at the Termination Date possess any Confidential Information. |
‘Confidential Information’ | means all confidential and/or trade secret information of the Company and/or any Group Company (whether or not recorded in any permanent, written or electronic form and whether or not marked as confidential) including marketing information, information relating to planned products/services, distribution techniques, sales, merchandising and pricing information, information relating to customers/suppliers (including names, contact details and actual or proposed business), financial corporate and strategic information, business projections and targets, business methods or plans, technical information, know how, inventions, research and development information, information relating to senior management succession details, employee records and other information in respect of which the Company or any Group Company owes an obligation of confidentiality to any third party, but shall not include any information which is in or comes into the public domain otherwise than as a result of any unauthorised disclosure by you or any other person who owes the Company and/or any Group Company an obligation of confidentiality in relation to the information disclosed. |
‘Customer’ | means any customer of the Company or of any Group Company: |
(a) | with whom you have directly or indirectly dealt in the period of 12 months prior to the Termination Date; or |
(b) | in respect of whom you had knowledge of Confidential Information at the Termination Date; or |
(c) | in respect of whom you had as a result of your employment with the Company and/or any Group Company developed a business relationship. |
‘Employee Handbook’ | means the Boots & Me Employee Handbook, as from time to time amended or replaced. |
‘Employee or Contractor’ | means any person who is and was at the Termination Date employed or engaged (as an employee or self-employed contractor) by the Company or any Group Company to work in any of their businesses: |
(a) | at the same level as you; or |
(b) | whose total remuneration package (including salary, bonus, commission and all benefits in kind) was equal to or more than £50,000 (gross) in the period of 12 months prior to the Termination Date. |
‘Garden Leave’ | means any period during which the Company exercises its rights under clause 13.3. |
‘Group Company’ | means any holding company for the time being of the Company or any subsidiary for the time being of the Company or of any such holding company (for which purpose “holding company” and “subsidiary” have the meanings ascribed to them by Section 736 of the Companies Act 1985, as amended from time to time). |
‘Intellectual Property’ | means all patents, inventions, processes, discoveries, trade marks, logos, design rights, registered designs, semi-conductor topography rights, copyright, database right, know-how, trade secrets and all such similar proprietary rights and applications for such rights wheresoever subsisting and whether available by registration or not and any part or parts thereof. |
‘Material Interest’ | means: |
(a) | the holding of any position as director, officer, employee, consultant, partner, sub-contractor, principal or agent; or any other position in or control over any person which enables you directly or indirectly to exercise influence; |
(b) | the direct or indirect control or ownership (whether jointly or alone) of any shares (or any voting rights attached to them) or debentures save for the ownership for investment purposes only of not more than 1 per cent of the issued ordinary shares of any company whose shares are listed on any recognised investment exchange (as defined in section 285 of the Financial Services and Markets Act 2000). |
‘Office’ | means such offices commensurate with the Executive’s position as a director or secretary in the Company or any Group Company. |
‘Pension Scheme’ | means the Boots Pension Scheme. |
‘Potential Customer’ | means any person with whom during the period of six months prior to the Termination Date the Company or any Group Company was in negotiation for the provision of Products or Services if you had been directly or indirectly concerned in such negotiations and/or in respect of which negotiation you had knowledge of Confidential Information at the Termination Date. |
‘Products’ | means products in the range of products supplied by the Company or any Group Company in the period of 12 months prior to the Termination Date. |
‘Restricted Area’ | means England, Scotland, Wales, Northern Ireland, Republic of Ireland, the Channel Islands, Isle of Man, France, Italy, Spain, Portugal, Holland, Norway, Switzerland, the Czech Republic, Turkey, Egypt, Germany, Russia, Romania, China, USA or any other country in which the Company or any Group Company has at the Termination Date a material business interest or is at the Termination Date planning to take a material business interest within 12 months of the Termination Date. |
‘Restricted Period’ | means 12 months from the Termination Date less any period in which the Company has exercised its rights under clause 13.3. |
‘Services’ | means services in the range of services supplied by the Company or any Group Company in the period of 12 months prior to the Termination Date |
‘Termination Date’ | means the date of termination of your employment with the Company. |
1.2 | In this Agreement, any phase introduced by the terms “including”, “include”, “in particular” or any similar expression shall be construed as illustrative and shall not limit the sense of the words preceding those terms. |
Mr A Gourlay
[ADDRESS]
28th June 2010
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|
· | Company Sick Pay (CSP) You will be covered by the ABMS company sick pay scheme which grants the following discretionary entitlement based on length of service: |
· | Under 6 months No payment |
· | 6 months – 2 years 2 weeks pay, paid from day 4 of absence |
· | 2 years – 5 years 8 weeks pay, paid from day 1 of absence |
· | 5 – 10 years 12 weeks pay, paid from day 1 of absence |
· | Over 10 years 16 weeks pay, paid from day 1 of absence |
· | 100% attendance recognition: - (applies to 2010) |
· | 1.5 weeks actual pay for each complete year of continuous service where age during the year is less than 22. |
· | 2 weeks actual pay for each complete year of continuous service where age during the year is 22 or above, but less than 41. |
· | 2.5 weeks actual pay for each complete year of continuous service where age during the year is 41+ |
· | There is no pension augmentation provision within the Boots redundancy policy |
· | You will retain your current holiday entitlement of 30 days. |
· | The ABMS holiday scheme applies in all other respects. |
· | Bonus arrangements will be communicated separately. |
· | You are eligible to join the Alliance Boots Retirement Savings Plan with effect from midnight on 1st July 2010, and you will already have received your offer pack. |
· | Your active membership in any occupational pension schemes with Boots UK Limited and/or its associated companies will come to an end at the point of transfer as communicated throughout the recent pensions consultation process. |
· | The pay date for the ABMS payroll is the 28th of the month or the last working day before the 28th if the 28th is a weekend or Bank Holiday. This means that at the time of the change you have been paid by Boots UK Limited on Monday 21st June 2010 and then, after your transfer, by ABMS on Wednesday 28th July 2010. |
Signed
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/s/ Alex Gourlay
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Alex Gourlay
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|
Dated
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26/6/2010
June 2010
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1. | ‘the Company’: Alliance UniChem Plc (registered number: 2515178) whose registered office is at Alliance House, 2 Heath Road, Weybridge, Surrey KT13 8AP; |
2. | ‘the Executive’: Ornella Barra of [ADDRESS]. |
1 | Interpretation |
1.1 | In this Agreement, the headings and marginal headings to the clauses are for convenience only and have no legal effect. |
1.2 | Any reference in this Agreement to any Act or delegated legislation includes any statutory modification or re-enactment of it or the provision referred to. |
1.3 | Any reference in this Agreement to a person shall include a reference to a firm and corporation and vice versa and any reference to the singular shall include the plural and vice versa. |
1.4 | In this Agreement: |
‘the Board’
|
means the Board of Directors of the Company from time to time and includes any committee of the Board duly appointed by it
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|
‘Businesses’
|
means all and any trades or other commercial activities of the Company or any Group Company:
|
|
(a)
|
with which the Executive (or any other employee, of the Company or any Group Company, on her behalf or under her instructions) shall have been concerned or involved to any material extent at any time during the period of 12 months ending on the Termination Date; or
|
|
(b)
|
which the Company or any Group Company shall at the Termination Date have determined to carry on in the immediate or foreseeable future and in relation to which the Executive shall at the Termination Date possess any Confidential Business Information
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|
‘Chief Executive’
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means any person or persons jointly holding such office of the Company from time to time and includes any person(s) exercising substantially the functions of a chief executive officer of the Company
|
‘Company Invention’
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means any improvement, invention or discovery made by the Executive which applying the provisions of section 39 of the Patents Act 1977 in the determination of ownership is, as between the parties, the property of the Company
|
‘Company Secretary’
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means the company secretary of the Company from time to time
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‘Confidential Business Information’
|
means Trade Secrets and all other confidential information of the Company and/or any Group Company, both of which include but are not limited to the following: all and any Corporate Information, Marketing Information, Technical Information and other information (whether or not recorded in documentary form or on computer disk or tape) to which the Company or any Group Company attaches an equivalent level of confidentiality or in respect of which it owes an obligation of confidentiality to any third party which the Executive shall acquire at any time during her employment by the Company but which does not form part of the Executive’s own stock in trade
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‘Corporate Information’
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means all and any information (whether or not recorded documentary form or on computer disk or tape) relating to financial projections and targets, financial details and accounts, budgets, the business methods, corporate and business plans, management systems, finances, maturing new business opportunities or research and development projects of the Company or any Group Company
|
‘Customer’
|
means any person (other than those listed in Schedule 2 hereto (if any) which the parties acknowledge have been introduced by the Executive to the Company) who or which shall be at or have been during the six month period immediately preceding the Termination Date negotiating with the Company or any Group Company for the supply of any Restricted Products or the provision of any Restricted Services or to whom or which the Company or any Group Company shall at any time during the period of one year prior to the Termination Date have supplied any Restricted Products or provided any Restricted Services
|
‘Deputy Chief Executive’
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means any person or persons jointly holding the office of Deputy Chief Executive of the Company from time to time and includes any person(s) exercising substantially the functions of a Deputy Chief Executive of the Company
|
‘Executive Scheme’
|
means the Company’s executive share option scheme approved by shareholders on 21st May 1997, as the same is currently in force and the same may from time to time hereafter be amended modified or replaced
|
‘Group Company’
|
means the Company and any “subsidiary” company of the Company and any “subsidiary undertaking” of the Company as such expressions are defined by sections 736, 736A, 258 and 259 of the Companies Act 1985) and any other company which for the time being is a company having an ordinary share capital (as defined in section 832 of the Income and Corporation Taxes Act 1988) of which not less than 25 per cent is owned directly or indirectly by the Company applying the provisions of section 838 of the Income and Corporation Taxes Act 1988 in the determination of ownership
|
‘Marketing Information’
|
means all and any information (whether or not recorded in documentary form or on computer disk or tape) relating to the marketing or sales of any past, present or future product or service of the Company or any Group Company including without limitation sales targets and statistics, market share and pricing statistics, marketing surveys and plans, market research reports, marketing and advertising plans and materials, marketing and advertising requirements, sales techniques, price list, discount structures, pricing policies, commissions, the names, addresses, telephone numbers, contact names and identities of Customers and potential customers of any suppliers and potential suppliers to the Company or any Group Company, the nature of their business operations, their requirements for any product or service sold by the Company by any Group Company and all confidential aspects of their business relationship with the Company or any Group Company
|
‘Material Interest’
|
means:
|
|
(a)
|
the holding of any position as director, officer, employee, consultant, partner, sub-contractor, principal or agent or any other position in any person which enables the Executive directly or indirectly to exercise influence;
|
|
(b)
|
the direct or indirect control or ownership (whether jointly or alone) of any shares (or any voting rights attached to them) or debentures save for the ownership for investment purposes only of not more than 3 per cent of the issued ordinary shares of any company whose shares are listed on any recognised investment exchange (as defined in section 285 of the Financial Services and Markets Act 2000); or
|
|
(c)
|
the direct or indirect provision of any financial assistance (as defined in section 152 of the Companies Act 1985)
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|
‘Pension Scheme’
|
means the Alliance UniChem International Pension Scheme established by a trust deed dated 29th September 1999, as the same may from time to time be amended modified or replaced
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‘Remuneration Committee’
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means the remuneration committee of the Company
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‘Restricted Area’
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means any area in which any Group Company carries on business from time to time
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‘Restricted Period’
|
means 12 months from the Termination Date unless the Company has enforced its rights pursuant to clause 16.8.1, in which case ‘Restricted Period’ shall be that period from the Termination Date which aggregated with the period of time during which the Company has enforced its rights under clause 16.8,1 shall amount to 12 months
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‘Restricted Products’
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means all and any products of a kind that shall be dealt in, produced, marketed or sold by the Company or any Group Company from time to time in the ordinary course of the Businesses
|
‘Restricted Services’
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means all and any services of a kind that shall be provided by the Company or any Group Company from time to time in the ordinary course of the Businesses
|
‘Share Incentive Plan’
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means the Company’s share incentive plan approved by shareholders on 12th June 1998, as the same is currently in force and the same may from time to time hereafter be amended modified or replaced
|
‘Shares’
|
means ordinary shares of ten pence each in the capital of the Company being shares available under the Executive Scheme end/or the Share Incentive Plan
|
‘Technical Information’
|
means all and any trade secrets, secret formulae, processes, inventions, designs, know-how, discoveries, technical specifications and other technical information (whether or not recorded in documentary form or on computer disk or tape) relating to the creation, development, production or supply of any past, present or future product or service of the Company or any Group Company
|
`Trade Secrets’
|
means confidential information which is rightly described or regarded by the Company as a trade secret or which it is reasonably apparent is so commercially sensitive as to be a trade secret
|
‘Termination Date’
|
means the date on which the Executive shalt cease to be employed by the Company
|
2 | Appointment and duration |
2.1 | The Company appoints the Executive and the Executive agrees to act as Southern Europe Director, responsible for Group Companies operating out of Southern Europe and designated European functions. The Executive accepts that the Company may at its discretion require her to perform (without any additional remuneration) other lawful duties or tasks not within the scope of her normal duties and the Executive agrees to perform those duties or undertake those tasks as if they were specifically required under this Agreement. |
2.2 | The appointment shall be deemed to have commenced on 30 th December 1997 and shall continue (subject to earlier termination as provided in this Agreement) until terminated by the Company giving to the Executive not less than 12 months’ prior written notice expiring at any time or by the Executive giving to the Company not less than 6 months’ prior written notice expiring at any time. |
2.3 | The Executive warrants that by virtue of entering into this Agreement or any other agreements or arrangements made or to be made between the Company or any Group Company and her she will not be in breath of any express or implied terms of any contract with or of any other obligation to any third party binding upon her. |
3 | Duties of the Executive |
3.1 | The Executive shell at all times during the period of this Agreement: |
3.1.1 | devote so much of her time, attention and ability as the board considers necessary to the duties of her appointment; |
3.1.2 | faithfully and diligently perform those duties and exercise such powers consistent with them which are from time to time assigned to or vested in her; |
3.1.3 | obey all lawful and reasonable directions of the Board; |
3.1.4 | use her best endeavours to promote the interests of the Company and its Group Companies; and |
3.1.5 | not at any time make any malicious statement relating to the Company or any Group Company or any other statement likely to be harmful to the Company or any Group Company. |
3.2 | The Executive shall (without further remuneration.) if and for so long as the Company requires during the period of this Agreement: |
3.2.1 | carry out the duties of her employment on behalf of any Group Company; |
3.2.2 | act as an officer of any Group Company or hold any other appointment or office as nominee or representative of the Company or any Group Company; |
3.2.3 | carry out such duties and the duties attendant on any such appointments as if they were duties to be performed by her on behalf of the Company, |
4 | Reporting |
4.1 | The Executive shall report directly to the Chief Executive and Deputy Chief Executive and shall at all times keep the Chief Executive and Deputy Chief Executive promptly and fully informed (in writing if so requested) of her conduct of the business or affairs of the Company and its Group Companies and provide such explanations as the Chief Executive or Deputy Chief Executive may require. |
5 | Place of work and residence |
5.1 | The Executive shall perform her duties at the offices of the Company based in Nice, France (currently located at 369/371, promenade des Anglais, BP 3132, 06203, Nice, Cedex 3, France) and/or at such other place of business of the Company or of any Group Company as the Company requires whether inside or outside France. The Executive acknowledges that the Company may require her to permanently relocate to work at any head office or other place of business of the Company and/or any Group Company. The Company shall not without her prior consent require the Executive to go to or reside anywhere outside southern Europe except for occasional visits in the ordinary course of her duties. |
6 | Pay |
6.1 | During her appointment the Company shall pay to the Executive a salary at the rate of £241,000 per year which shall accrue day-to-day and be payable by equal monthly instalments in arrears on or about the 22nd day of each month. The salary shall be deemed to include any fees which may be receivable by the Executive as a director of the Company, if applicable, or any Group Company and shell also be deemed to include any fees receivable by the Executive in respect of any other company or unincorporated body in which she holds office as nominee or representative of the Company or any Group Company. |
6.2 | The Remuneration Committee shall review the Executive’s salary from time to time end the rate of salary may be increased by such amount if any as the Remuneration Committee may resolve. |
6.3 | The Company may in its absolute discretion establish (and from time to time determine, vary or replace) a performance related remuneration scheme for the Executive, Any such scheme shall be discretionary, shall not be a contractual entitlement and the Company shall have no liability to the Executive for failure to establish, pay out under or maintain any such scheme. Without prejudice to the generality of the foregoing, the duration and terms and conditions of any such scheme (including without limitation targets and related payments) shall be as the Company may from time to time in its absolute discretion expressly notify the Executive in writing. |
7 | Shares |
7.1 | The Executive may be entitled to subscribe for such number of Shares as the Remuneration Committee may from time to time determine and notify the Executive in writing, subject to the terms and conditions of the Executive Scheme and/or the Share Incentive Scheme (as appropriate) and PROVIDED THAT: |
7.1.1 | prior to any subscription by the Executive she complies with all relevant Inland Revenue regulations and the Company obtains such approval from the Inland Revenue as the Remuneration Committee thinks fit; and |
7.1.2 | prior to any subscription the Remuneration Committee approves such proposed subscription. |
8 | Pension |
8.1 | The Executive shall be entitled to be and remain a member of the Pension Scheme subject to the terms of its deeds and rules from time to time details of which are available from the Company Secretary. |
8.2 | The Company shall be entitled at any time to amend, modify, replace or terminate the Pension Scheme or the Executive’s membership thereof subject to providing the Executive with the benefit of an equivalent pension scheme (‘the New Scheme’) each and every benefit of which shall be no less favourable than the accrued benefits provided to the Executive under the Pension Scheme. The Company shall be entitled to amend or modify the Pension Scheme provided that the benefits provided under such amended or modified scheme are no less favourable than the accrued benefits provided before any such amendment or modification took effect. |
9 | Insurance Benefits |
9.1 | The Executive shall be entitled to participate at the Company’s expense: |
9.1.1 | for her own benefit in the Company’s permanent health insurance scheme; and |
9.1.2 | for her own benefit in the Company’s life assurance scheme at the rate of four times the Executive’s salary; and |
9.1.3 | for her own benefit in the Company’s personal accident and travel insurance scheme, |
9.2 | The Company shall be entitled to vary or replace any such schemes referred to in clause 9.1 from time to time provided always that the benefits provided under any such varied or replacement scheme are in all material respects (in the Company’s reasonable opinion) at least as beneficial to the Executive as the schemes thereby varied or replaced. Notwithstanding the foregoing, if in the reasonable opinion of the Company (whose opinion shall be conclusive) the continuation of any of the benefits set out in this clause 9.2 is not reasonably practicable (including without limitation by reason of the cost thereof) the Company shall be entitled to terminate the provision of any such benefits. |
10 | Transport |
10.1 | The Executive shall be provided with transport in order to allow her to perform her duties. |
10.2 | Subject to the Executive holding a current full driving licence the Company shall provide the Executive, for private use by her and any other driver holding a current full driving licence previously approved by the Company, with a fully expensed car of a make, model and specification selected by the Company which in the opinion of the Board is commensurate with the status of the Executive and the image of the Company. |
11 | Expenses |
11.1 | The Company shall reimburse to the Executive on a monthly basis all travelling, hotel, entertainment and other expenses reasonably incurred by her in the proper performance of her duties subject to the Executive complying with such guidelines or regulations issued by the Company from time to time in this respect and to the production to the Company of such vouchers or other evidence of actual payment of such expenses as the Company may reasonably require. For the avoidance of doubt, travelling expenses between her residence and her place of work and hotel expenses incurred by her while working at her place of work more than 100 miles from her residence are expenses reasonably incurred by her in the proper performance of her duties. |
11.2 | Where the Company issues a company sponsored credit or charge card to the Executive she shall use such card only for expenses reimbursable under clause 11.1 above, and shall return it to the Company forthwith on the termination of her employment (or if so required by the Company on the giving by either party of notice to terminate her employment, whether lawfully or not). |
11.3 | If, in the Company’s reasonable opinion, it is necessary or appropriate for the Executive to be and remain a member of a recognised professional regulatory body for the better performance of the Executive’s duties, then; |
11.3.1 | the Company shall pay the appropriate subscription and the annual membership fee, to permit the Executive to be and remain a member of such body; |
11.3.2 | the Company shall pay the cost of any fees for continuing education or training that is necessary to permit the Executive to continue as a member of any such body. |
12 | Holiday |
12.1 | In addition to UK public holidays the Executive is entitled to 30 working days paid holiday in each holiday year from 1st January to 31st December to be taken at such time or times as are agreed with the Deputy Chief Executive. The Executive shall not without the prior consent of the Deputy Chief Executive carry forward any unused part of her holiday entitlement to a subsequent holiday year, |
12.2 | For the holiday year during which her employment commences or terminates, the Executive is entitled to 2.5 working days holiday for each complete calendar month of her employment by the Company during that holiday year. On the termination of her employment for whatever reason, the Executive shall not be entitled to pay in lieu of outstanding holiday entitlement (save if her employment has been terminated by the Company in breach of the terms and/or conditions of her employment) and the Executive shall be required to repay to the Company any holiday pay received in excess of her actual entitlement. |
13 | Incapacity |
13.1 | If the Executive shall be prevented by illness (including mental disorder), injury or other incapacity from properly performing her duties hereunder she shall report this fact forthwith to the Deputy Chief Executive and if the Executive is so prevented for seven or more consecutive days she shall provide a medical practitioner’s statement on the eighth day and weekly thereafter so that the whole period of incapacity is certified by such statements, immediately following her return to work after a period of absence due to incapacity the Executive shall complete a self-certification form available from the Company Secretary’s office detailing the reason for her absence. |
13.2 | If the Executive shall be absent from her duties hereunder due to illness (including mental disorder), injury or other incapacity duly certified in accordance with the provisions of clause 13.1 hereof, she shall be paid her full remuneration hereunder for up to 180 working days’ absence in any period of 12 consecutive months and thereafter such remuneration, if any, as the Board shall from time to time determine provided that all such remuneration shall be inclusive of any Statutory Sick Pay to which the Executive is entitled or other benefits recoverable by the Executive (whether or not recovered) may be deducted therefrom. |
13.3 | For Statutory Sick Pay purposes the Executive’s qualifying days shall be her normal working days. |
13.4 | At any time during the period of this employment the Executive shall at the request and expense of the Company permit herself to be examined by a registered medical practitioner (if in the Company’s reasonable opinion any such examination is necessary or appropriate), such medical practitioner to be selected by the Company. The Executive authorises such medical practitioner to disclose to and discuss with the Company’s medical adviser the results of such examination (“the Results”) and any matters which arise from it in order that the Company’s medical adviser can notify the Company of any matters which, in her opinion, might hinder or prevent the Executive (if during a period of incapacity) from returning to work for any period or (in other circumstances) from properly performing any duties of her appointment at any time. Subject to the provisions of law or professional conduct prohibiting disclosures of the Results to the Executive, the Executive shall be entitled to be informed of the Results. |
13.5 | The Company may terminate the Executive’s employment on the grounds of incapacity, as set out in clause 16 hereof. |
14 | Acknowledgements by the Executive |
14.1 | The Executive acknowledges: |
14.1.1 | that the Company and each Group Company possesses a valuable body of Confidential Business Information; |
14.1.2 | that the Company will give her access to Confidential Business information in order that she may carry out the duties of her appointment; |
14.1.3 | that the duties of her employment include, without limitation, a duty of trust and confidence and a duty to act at all times in the best interests of the Company; |
14.1.4 | that the Company requires all its senior employees to accept restrictions which are similar to those set out in clauses 16 and 17 for its and each of their mutual protection; |
14.1.5 | that the disclosure of any Confidential Business Information to any customer or actual or potential competitor of the Company or any Group Company would place such company at a serious competitive disadvantage and would cause immeasurable (financial and other) damage to the Businesses; |
14.1.6 | that if during the Restricted Period she was to hold any Material Interest in Customer or any actual or potential competitor of the Company or any Group Company, it would place the Company or such Group Company at a serious competitive disadvantage and would cause immeasurable (financial and other) damage to the Businesses. |
15 | Obligations during employment |
15.1 | Inventions |
15.1.1 | if at any time during her employment the Executive (whether alone or with any other person or persons) makes any invention which relates either directly or indirectly to the Businesses the Executive shall promptly disclose to the Company full details, including drawings and models, of such invention to enable the Company to determine whether or not it is a Company Invention. |
15.1.2 | If the invention is a Company Invention, the Executive shall hold it in trust for the Company and, at the request and expense of the Company, do all things necessary or desirable to enable the Company or its nominee to obtain for itself the full benefit of and to secure patent or other appropriate forms of protection for the Company Invention throughout the world. |
15.1.3 | Decisions as to the patenting and exploitation of any Company Invention shall be at the sole discretion of the Company. |
15.1.4 | The Executive irrevocably appoints the Company to be her attorney in her name and on her behalf to execute documents and/or deeds to use the Executive’s name and to do all things which may be necessary or desirable for the Company to obtain for itself or its nominee the full benefit of the provisions of clauses 15.1.2 and 15,2,2 and a certificate in writing signed by the Chief Executive that any instrument or act fails within the authority hereby conferred shall be conclusive evidence that such is the case so far as any third party is concerned. |
15.2 | Copyright etc. |
15.2.1 | The Executive shall promptly disclose to the Company all copyright works or designs originated, conceived, written or made by her alone or with others (except only those works originated, conceived, written or made by her wholly outside her normal working hours which are wholly unconnected with her appointment) and shall hold them in trust for the Company until such rights shall be fully and absolutely vested in the Company, |
15.2.2 | The Executive hereby assigns to the Company by way of future assignment all copyright, design right and other proprietary rights (If any) for the full terms thereof throughout the world in respect of all copyright works and designs originated, conceived, written or made by the Executive (except only those works originated, conceived, written or made by the Executive wholly outside her normal working hours which are wholly unconnected with her appointment) during the period of her appointment with the Company, |
15.2.3 | The Executive hereby irrevocably and unconditionally waives in favour of the Company any and all moral rights conferred on her by Chapter IV of Part I of the Copyright Designs and Patents Act 1988 for any work in which copyright or design right is vested in the Company whether by clause 15.2.2 or otherwise, |
15.2.4 | The Executive shall, at the request and expense of the Company, do all things necessary or desirable to substantiate the rights of the Company under clauses 15.2.2 and 15.2.3. |
15.3 | Share dealings |
15.3.1 | The Executive shall comply, where relevant, with every rule of law, every requirement of the London Stock Exchange and every regulation of the Company from time to time in force in relation to dealings in the shares, debentures or other securities of the Company or any Group Company and unpublished price sensitive information affecting the shares, debentures or other securities of the Company and any Group Company or any other company and, in relation to overseas dealings, the Executive shall also comply with all laws of the state and all regulations of the stock exchange, market or dealing system in which such dealings take place. |
15.3.2 | The Executive shall not (and shall procure so far as she is able that her spouse and children shall not) deal or become or cease to be interested (within the meaning of Part I of Schedule 7 to the Companies Act 1985) in any securities of the Company or any Group Company except in accordance with any Company rules or guidelines from time to time relating to securities transactions by directors. |
15.4 | Conflict of interest |
15.4.1 | The Executive agrees that during the period of her appointment with the Company, she shall: |
15.4.1.1 | abide by any lawful relevant Company policy that may be promulgated from time to time; |
15.4.1.2 | not directly or indirectly disclose to any person, firm or company or use other than for any legitimate purposes of the Company or any Group Company any Confidential Business Information and the Executive shall use all due care and diligence to prevent any unauthorised disclosure or use of any Confidential Business information: |
15.4.1.3 | not without the Board’s prior written permission hold any Material Interest in any person, firm or company which: |
(a) | is or shall be in competition with any of the businesses carried on by the Company and/or any Group Company from time to time; |
(b) | impairs or might reasonably be thought by the Board to impair her ability to act at all times in the best interests of the Company; or |
(c) | requires or might reasonably be thought by the Board to require her to disclose any Confidential Business Information in order properly to discharge her duties to or to further her interest in such person, firm or company; |
15.4.1.4 | not directly or indirectly receive or obtain in respect of any goods or services sold or purchased or other business transacted (whether or not by her) by or on behalf of the Company or any Group Company any discount, rebate, commission or other inducement (whether in cash or in kind) which is not authorised by any Company rules or guidelines from time to time and if she or any person firm or company in which she holds any Material Interest shell obtain any such discount, rebate, commission or inducement, she shall immediately account to the Company for the discount rebate commission or other inducement so received; |
15.4.1.5 | not (other than for the proper performance of her duties) without the prior authority of the Board remove from the Company and/or any Group Company’s premises or copy or allow others to copy the contents of any document, computer disk, tape, memory device, notebook or other tangible item (whether or not eye-readable) which contains any Confidential Business Information or which belongs to the Company or any Group Company; |
15.4.1.6 | return to the Company upon request and, in any event, at the Termination Date all documents, papers, computer disks, tapes, other reusable material, memory devices, notebooks and other tangible items in her possession or under her control (including without limitation those referred to in clause 15.4.2) which belong to the Company or any Group Company or which contain or refer to any Confidential Business Information; |
15.4.1.7 | if so lawfully requested by the Board at any time delete or return to the Company, as the Company may require, all Confidential Business Information from any computer disks, tapes or other reusable material in her possession or under her control and destroy or return to the Company, as the Company may require, all other documents and tangible items in her possession or under her control which contain or refer to any Confidential Business Information. |
15.4.2 | All documents, notes, the contents of all computer disks and tapes, memoranda, records and writing and made by the Executive relating to the business of the Company and/or any Group Company shall be and remain the property of the Company and/or any Group Company to whose business they relate and shall be returned to the company to whom they belong forthwith upon request. |
15.5 | General |
15.5.1 | The restriction contained in clauses 15.4.1.2 and 17.3; |
15.5.1.1 | will not restrict the Executive from disclosing (but only to the proper recipient) any Confidential Business Information which the Executive is required to disclose by law or any order of the court or any relevant regulatory body, provided that the Executive shall, unless obliged by law, have given prior written notice to the Company of the requirement and of the information to be disclosed and allowed the Company an opportunity to comment on the requirement before making the disclosure; and |
15.5.1.2 | will not apply to Confidential Business Information which is in or which comes into the public domain otherwise than as a result of an unauthorised disclosure by the Executive or any other person who owes the Company and/or any Group Company an obligation of confidentiality in relation to the information disclosed. |
15.6 | Further restrictions |
15.6.1 | The Executive shall not during her employment (save in a purely social capacity or with the prior express written consent of the Chief Executive) make any contact, whether formal or informal, written or oral, with any of the Company or Group Company’s past, current or prospective suppliers of goods for resale, customers or clients for any purpose (including but not limited to an intention to set up a competing business or to seek employment) other than for the legitimate business interests of the Company or Group Company, |
15.6.2 | The Executive shall not during her employment directly or indirectly: |
15.6.2.1 | solicit or endeavour to entice away from the Company or any Group Company an employee or consultant, or discourage from being employed or engaged by the Company or any Group Company any person who is an employee or consultant of or, to the knowledge of the Executive, a prospective employee or consultant of the Company or any Group Company; or |
15.6.2.2 | employ or engage or procure another person to employ or engage any such person. |
15.7 | The restrictions set out in this clause 15 are without prejudice to the other duties whether fiduciary or otherwise owed to the Company or any Group Company whether express or implied. |
16 | Termination of agreement |
16.1 | Automatic termination |
16.1.1 | on the Executive reaching her retirement age being her 60th birthday; or |
16.1.2 | if the Executive becomes prohibited by law from being a director; or |
16.1.3 | if the Executive resigns her office as a director; or |
16.1.4 | If the office of director of the Company held by the Executive is vacated pursuant to the Company’s Articles of Association (save if the vacation shall be caused by Illness (including mental disorder) or injury) or if the Executive is otherwise duly removed from her office of director, |
16.2 | Suspension |
16.3 | Immediate dismissal |
16.3.1 | commits any act of gross misconduct or any other material breach of the obligations of her employment or (after written warning) repeats or continues any breach of such obligations; or |
16.3.2 | is guilty of any conduct which in the reasonable opinion of the Board brings her, the Company or any Group Company into disrepute: or |
16.3.3 | is convicted of any criminal offence (excluding an offence under road traffic legislation for which she is not sentenced to any term of imprisonment whether immediate or suspended); or |
16.3.4 | commits any act of dishonesty whether relating to the Company, any Group Company, any of its or their employees or otherwise; or |
16.3.5 | becomes bankrupt or makes any arrangement or composition with her creditors generally (under the provisions of the Insolvency Act 1986); or |
16.3.6 | becomes of unsound mind or a patient as defined in either section 112 or 145 of the Mental Health Act 1983 or has been admitted to a hospital in pursuance of an application made under that Act; or |
16.3.7 | contravenes any model code from time to time applicable to directors and/or employees of the Company. |
16.4 | Dismissal on short notice |
16.5 | Resignation on a change in control |
16.6 | Pay in lieu |
16.7 | Miscellaneous |
16.7.1 | resign from all and any offices which she may hold as a director of the Company or of any Group Company and from all other appointments or offices which she holds as nominee or representative of the Company or any Group Company; and |
16.7.2 | transfer without payment to the Company or as the Company may direct any shares held by her as a nominee of the Company or any Group Company; |
16.8 | Provisions applicable during a notice period |
16.8.1 | In the event that either party gives notice to terminate the appointment of the Executive then for a period not exceeding 12 months (or 6 months in the case of a notice served by the Executive in accordance with clause 2.2) the Company shall be under no obligation to vest in or assign to the Executive any powers or duties or to provide any work for the Executive and without prejudice to the generality of the foregoing the Company may in its absolute discretion require the Executive to perform only such duties as it may allocate to her (including without limitation research projects or any other work whether or not directly related to the Executive’s duties) or not to perform any of her duties under this Agreement or to work in such other capacities as the Company may require (commensurate with the Executive’s status) and/or to exclude her from any premises of the Company or of any Group Company (without providing any reason therefor) provided always that throughout any such period the Executive’s salary (and other contractual remuneration, if any) under clause 6 and other contractual benefits shall not cease to be paid or provided (unless and until her employment shall be terminated). |
16.8.2 | Action taken on the part of the Company (as referred to in clause 16.8.1) shall not constitute a breach of this Agreement of any kind whatsoever in respect of which the Executive has any claim against the Company. |
16.8.3 | If the Executive fails to make herself available for work during any period of notice of termination of the Executive’s employment, other than at the request of the Company pursuant to clause 16.8.1 or with the express permission in writing of the Chief Executive, the Company reserves the right to deduct one day’s salary (and any amount payable under any discretionary performance related remuneration scheme pursuant to clause 6.3) for each day of each such absence. |
16.8.4 | If and insofar as the Company exercises its rights under clause 16.8.1 so as to exclude the Executive from the premises of the Company during the notice period, then the Executive may carry out other activities (for persons other than the Company or any other Group Company) subject to obtaining the previous express written consent of the Chief Executive which consent may be given subject to such terms and conditions as he may determine (each of which shall be deemed a condition of this Agreement) and such consent, if given, may be revoked at any time. Provided that the Executive has provided the Chief Executive (and at all times kept the Chief Executive up to date and fully informed) on the basis of the utmost good faith, with full particulars of the nature of any interest and the likely demand it will make on her time and abilities, the consent of the Chief Executive to the Executive undertaking any other activities shall not be unreasonably withheld or revoked where, in the reasonable opinion of the Chief Executive the giving or failing to revoke consent would not materially adversely affect the interests of the Company or any Group Company or the full performance by the Executive of her duties hereunder or such duties, if any, as the Company may require the Executive to perform pursuant to clause 16.8.1. |
17 | Obligations after employment |
17.1 | The Executive shall not within the Restricted Area directly or indirectly: |
17.1.1 | without prior express consent in writing of the Chief Executive (as referred to in clause 17.2) during the Restricted Period, hold any Material Interest in any business (including without limitation in any Customer) which is or shall be wholly or partly in competition with any of the Businesses including without limitation those listed in Schedule 3 and their respective subsidiaries and holding companies (as defined in sections 736 and 736A of the Companies Act 1985) (being companies in which the parties acknowledge that the Executive would inevitably give her new employer an unfair advantage vis-à-vis the Company in view of her embedded knowledge of the Company and those companies’ status as head-on competitors of the Company; |
17.1.2 | without the prior express consent in writing of the Chief Executive (as referred to in clause 17.2) during the Restricted Period, hold any Material Interest in any person, firm or company which requires or might reasonably be thought by the Company to require her to disclose or make use of any Confidential Business Information in order properly to discharge her duties to or to further her interest in such person, firm or company; |
17.1.3 | without the prior express consent in writing of the Chief Executive (as referred to in clause 17.2) during the Restricted Period, seek in any capacity whatsoever (either alone or jointly with any other person and whether on her own account or in partnership with others or as an officer employee agent of or consultant to any other person) any business, orders or custom for any Restricted Products or Restricted Services from any Customer; |
17.1.4 | without the prior express consent in writing of the Chief Executive (as referred to in clause 17.2) during the Restricted Period, accept in any capacity whatsoever (either alone or jointly with any other person and whether on her own account or in partnership with others or as an officer employee agent of or consultant to any other person) orders for any Restricted Products or Restricted Services from any Customer; |
17.1.5 | at any time after the Termination Date (either alone or jointly with any other person and whether on her own account or in partnership with others or as an officer employee agent of or consultant to any other person) interfere or seek to interfere or take such steps as may interfere with the continuance of supplies to the Company and/or any Group Company which are at the Termination Date or have within 12 months prior to the Termination Date been supplying goods, components, materials or supplies to the Company and/or any Group Company; |
17.1.6 | at any time before or after the Termination Date (either alone or jointly with any other person and whether on her own account or in partnership with others or as an officer employee agent of or consultant to any other person) induce or seek to induce by any means involving the disclosure or use of Confidential Business Information any Customer to cease dealing with the Company or any Group Company or to restrict or vary the terms upon which it deals with the Company or any Group Company; |
17.1.7 | for the period of 12 months after the Termination Date (either alone or jointly with any other person and whether on her own account or in partnership with others or as an officer employee agent of or consultant to any other person) solicit or entice away or seek to solicit or entice away from the Company or any Group Company any person who is and was at the Termination Date employed by the Company or any Group Company to work in any of the Businesses as a director senior manager or salesperson and/or who reported directly or indirectly to the Executive; |
17.1.8 | at any time after the Termination Date represent herself or permit herself to be held out by any person firm or company as being in anyway connected with or interested in the Company or any Group Company (save as the holder of Shares if such be the case); |
17.1.9 | at any time after the Termination Date disclose or make use of any Trade Secrets while such Trade Secrets remain in the nature of trade secrets. |
17.2 | The consent of the Chief Executive to the Executive having any interest or engaging in any of the matters referred to in clause 17.1.1, 17.1.2, 17.1.3 and/or 17.1.4 may be given subject to such terms and conditions as he may specify (each of which shall be deemed a condition of this Agreement) and such consent if given may be revoked at any time. Provided that the Executive has provided the Chief Executive (and at all times kept him fully up to date and informed) on the basis of the utmost good faith with full particulars of the nature of any interest or other activity as referred to in clause 17.1.1, 17.1.2, 17.1.3 and/or 17.1.4, the consent of the Chief Executive to the Executive having any such interest or undertaking any such activity shall not be unreasonably withheld or revoked where in the reasonable opinion of the Chief Executive the giving or failing to revoke consent would be: |
17.2.1 | immaterial in relation to the Businesses; |
17.2.2 | immaterial in relation to the level of business orders or custom for Restricted Products and/or Restricted Services from any Customer. |
17.3 | The Executive shall not at any time after the Termination Date directly or indirectly disclose to any person, firm or company or make use of any Confidential Business Information. |
17.4 | The Executive agrees that the restrictions contained in clauses 17.1, 17.3 and 15 are reasonable and necessary for the protection of legitimate interests of the Company and each Group Company and that, having regard to those interests, those restrictions do not work harshly on her. It is nevertheless agreed that if any of those restrictions shall taken together or separately be held to be void or ineffective for any reason but would be held to be valid and effective if part of the wording were deleted, that restriction shall apply with such deletions as may be necessary to make it valid and effective. |
17.5 | The restrictions contained in each sub-clause of clauses 17.1, 17.3 and 15 shall be construed as separate and individual restrictions and shall each be capable of being severed without prejudice to the other restrictions or to the remaining provisions of this Agreement. |
17.6 | The Executive has given the undertakings contained in clauses 17.1, 17.3 and 15 to the Company for itself and as trustee for each Group Company and the Executive will at the request and cost of the Company enter into direct undertakings with any Group Company which correspond to the undertakings in clauses 17.1, 17.3 and 15, or which are less onerous only to the extent necessary (in the opinion of the Company or its legal advisors) to ensure that such undertakings are valid and enforceable. |
17.7 | The Company shall not be entitled to rely on the covenants contained in clauses 17.1.1 to 17.1.8 (inclusive) if the Company has committed a repudiatory breach of this Agreement. |
18 | General |
18.1 | Other terms or benefits |
18.1.1 | The provisions of the Company’s standard terms and conditions of employment, contained in the Company’s Staff Handbook (as amended from time to time) (the “Staff Handbook”), shall not be terms of the Executive’s employment and are not legally binding on the Company. In the case of a conflict between this Agreement and the Staff Handbook the provisions of this Agreement shall prevail. The Staff Handbook is available from the Company Secretary. |
18.1.2 | This Agreement sets out all the salary and other benefits to which the Executive is entitled and any ether benefits are non-contractual, are provided in the absolute discretion of the Company and may be withdrawn at any time. |
18.2 | Statutory particulars |
18.3 | Prior agreements |
18.4 | Accrued rights |
18.5 | Proper law |
18.6 | Acceptance of jurisdiction |
18.7 | Notices |
18.8 | Consent |
1. | The Executive’s employment by the Company commenced on 8 th March 1984. |
2. | No employment of the Executive with a previous employer counts as part of the Executive’s continuous employment with the Company and her continuous employment began on 8 th March 1984. |
3. | The Executive’s hours of work are the normal hours of the Company from 9.00am to 5.00pm Monday to Friday each week together with such additional hours as may be necessary so as properly to fulfil her duties. |
4. | A Contracting-Out Certificate pursuant to the provisions of the Pensions Schemes Act 1993 is held by the Company in respect of the Executive’s employment. |
5. | The disciplinary rules applicable to the Executive are contained in the Company’s Staff Handbook that is available from the Company Secretary. |
6. | If the Executive is dissatisfied with any disciplinary decision relating to her or if the Executive has any grievance relating to her employment, this must be raised with the Chief Executive (either orally or in writing). If the Executive is dissatisfied with the decision of the Chief Executive, she must (within 5 days of the decision of the Chief Executive) request in writing to the Company Secretary a meeting with the Board. A meeting date will be communicated to the Executive and she will be invited to attend such meeting together with another person if the Executive so wishes. The decision of the Board at such meeting will be notified to the Executive within 5 days of such meeting and the decision of the Board will be final. |
7. | There are no collective agreements applicable to the Executive’s employment. |
(1) | Alliance Boots plc whose registered office is at Sedley Place, 4 th Floor, 361 Oxford Street, London, W1C 2JL; |
(2) | Alliance UniChem Plc whose registered office is at 2 The Heights, Brooklands, Weybridge, Surrey, KT13 0NY; and |
(3) | ORNELLA BARRA of 2 The Heights, Brooklands, Weybridge, Surrey, KT13 0NY (“The Executive”). |
(A) | The Executive is employed by Alliance UniChem Plc under the terms of a Service Agreement dated 10 December 2002 (“the Service Agreement”). |
(B) | On 31 July 2006 the merger of Boots Group PLC and Alliance UniChem Plc was completed and Boots Group PLC changed its name to Alliance Boots plc. |
1. | On 31 July 2006 the Executive’s Service Agreement with Alliance UniChem Plc terminated by mutual consent. |
2. | With immediate effect thereafter a New Service Agreement commenced between the Executive and Alliance Boots plc (“the New Service Agreement”). The New Service Agreement was agreed to be on identical terms to the Service Agreement save for the removal of the restriction under clause 17.1.1 in relation to Boots. The Executive’s continuity of employment is preserved and all references to Alliance UniChem Plc contained in the Service Agreement shall be construed as references to Alliance Boots plc in the New Service Agreement. |
/s/ Marco Pagni
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For Alliance Boots plc
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/s/ Marco Pagni
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For Alliance UniChem Plc
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/s/ Ornella Barra
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ORNELLA BARRA
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(1) | Alliance Boots Holdings Limited (formerly known as Alliance Boots Limited and previously as Alliance Boots plc), a private limited company incorporated under the laws of England and Wales, having its registered office at Sedley Place, 4th Floor, 361 Oxford Street, London WIC 2.11, and registered under No. 04452715 (the " Former Employer "); |
(2) | Alliance Boots Management Services MC S.A.M. a société anonyme incorporated under the laws of Monaco, having its registered, office at [ADDRESS] and registered with the Monaco Register of Commerce under RCI N°: 13S05893 (the " Alliance Boots MS "); and |
(3) | Ornella Barra , a citizen of Monaco, resident at [ADDRESS] (the " Executive ", together with the Former Employer and Alliance Boots MBS the " Parties ", and each a " Party "). |
(A) | The Executive was employed by Alliance Unichem Plc pursuant to an Employment Agreement dated December 10, 2002, by and between the Alliance Unichem Plc and the Executive (the " Service Agreement "). |
(B) | Upon completion of the merger between Boots Group PLC and Alliance UniChem Plc and the change of name of Boots Group PLC to Alliance Boots plc, the Service Agreement was terminated by mutual consent on July 31, 2006. |
(C) | Pursuant to that Agreement, dated July 31, 2006, by and among the Former Employer, Alliance UniChem Plc and the Executive, with immediate effect thereafter a New Service Agreement dated July 31, 2006 commenced between the Executive and the Former Employer on identical terms to the Service Agreement save for the removal of the restriction under clause 17.1.1 thereof in relation to Boots (the " New Service Agreement "), a copy of which is attached hereto as Exhibit A . |
(D) | On December 21, 2012, Alliance Boots MS, a subsidiary of Alliance Boots Holdings Limited was incorporated in Monaco with its principal business activity being the provision of management services. |
(E) | The Parties desire and agree to the appointment of Alliance Boots MS as the substitute employer in place of the Former Employer under the New Service Agreement on the terms and subject to the conditions contained herein. |
1. | Novation |
2. | Release and Discharge |
3. | Continuity of Service; Place of Work |
4. | Amendment and Continuing Effect |
5. | Effective Date |
6. | Notices |
Address: |
[ADDRESS]
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For the attention of: | The President |
Address:. | Alliance Boots Group |
For the attention of: | Frank Standish, Corporate Secretary |
7. | Entire Agreement |
8. | Further Assurances |
9. | Counterparts |
10. | Governing Law |
EXECUTED
and delivered as a deed by
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ALLIANCE BOOTS HOLDINGS LIMITED
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acting by FRANK STANDISH , a director, duly |
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/s/ Frank Standish
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authorized for the purposes hereof, in the
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presence of a witness: |
Signature | : /s/ Marco Pagni |
Name | : MARCO PAGNI |
Occupation | : GENERAL COUNSEL |
Address | : c/o Sedley Place, 4th Floor, 361 Oxford Street, |
EXECUTED and delivered as a deed by | ||
ALLIANCE BOOTS MANAGEMENT |
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SERVICES MC S.A.M
.acting by
Stefano
Pessina
,
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/s/ Stefano Pessina
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a director, duly authorized for the |
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purposes hereof, in the presence of a witness: |
Signature | : /s/ Marco Pagni |
Name | : MARCO PAGNI |
Occupation | : GENERAL COUNSEL |
Address | : c/o Sedley Place, 4th Floor, 361 Oxford Street, |
EXECUTED and delivered as a deed by |
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ORNELLA BARRA in the presence of a |
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/s/ Ornella Barra
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witness:
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Signature | : /s/ Marco Pagni |
Name | : MARCO PAGNI |
Occupation | : GENERAL COUNSEL |
Address | : c/o Sedley Place, 4th Floor, 361 Oxford Street, |
1. | Effect of certain words and expressions |
1.1 | Certain words and expressions have particular meanings in this Agreement. Please refer to Schedule 1. |
2. | Appointment |
2.1 | With effect from the date of this Agreement (the "Commencement Date"), in consideration of the mutual covenants and agreements herein, the Company appoints you and you agree to act as Managing Director, Health & Beauty UK and Republic of Ireland. You agree that the Company may at its discretion require you to perform, without additional remuneration, other lawful duties or reasonable tasks not specifically within the scope of your normal duties but consistent with your seniority and professional skills and you agree to perform those duties/tasks. The Company may appoint someone to act jointly with you in the performance of your duties. |
2.2 | You shall at all times during this Agreement comply with all policies, procedures and practices of the Company from time to time notified to you by the Company. |
2.3 | At all times during the continuance of this Agreement you shall: |
2.3.1 | devote the whole of your working time and attention to the duties of the Appointment assigned to you from time to time; |
2.3.2 | use your best endeavours to promote and protect the interests of the Company and all Group Companies; |
2.3.3 | faithfully and diligently serve the Company and perform such duties and exercise such powers as may from time to time be assigned to or vested in you; |
2.3.4 | obey all reasonable and lawful directions given to you by or under authority of the Board; |
2.3.5 | make such reports to the Board on any matters within your knowledge concerning the affairs of the Company or any Group Company as are reasonably required. |
2.4 | You shall be a director of Boots UK Limited and: |
2.4.1 | shall hold such Office as the Company may from time to time reasonably require; |
2.4.2 | (if the Company so requests and in any event on termination of the Appointment) shall immediately resign without claim for compensation from any Office held in any Group Company (but without prejudice to any rights you may have to claim compensation in respect of termination of the Appointment); |
2.4.3 | shall not do anything that would cause you to be disqualified from holding any Office; |
2.4.4 | shall not (without the prior written approval of the Board) resign from any Office which you hold in any Group Company or any trusteeship which you hold as a result of the Appointment; |
2.5 | You hereby warrant that you are free to take up this employment and are not subject to any restriction that might hinder or prevent the full performance of your duties. |
2.6 | Your continuous period of employment with the Company commenced on [Date]. |
3. | Hours of Work, Place of Work and Salary |
3.1 | You shall work such hours as are reasonably necessary for the proper performance of your duties. |
3.2 | The Company shall, with effect from the Commencement Date, pay you a basic salary of £450,000 per year, paid by direct credit transfer to your nominated bank or building society on or around the 28 th of each calendar month in arrears. Such basic salary includes any fees receivable by you as Officer, nominee or representative of any Group Company. You shall not be entitled to any directors' fees in addition to your basic salary. Your basic salary will be reviewed annually but the Company will be under no obligation to award an increase. The Company reserves the right to make deductions from your basic salary or other payments owed to you in order to recover any overpayments made to you in error. |
3.3 | Subject to clause 3.4, you shall perform your duties at the Company's Nottingham Support Office and you may be required to travel within the UK or abroad from time to time in the performance of your duties. |
3.4 | Due to the nature of the Company's business and the work you will be required to do, the Company may from time to time, on giving you reasonable notice, require you to work on a temporary or permanent basis at any of its offices or those of its Group Companies. The Company will pay your reasonable expenses incurred in connection with any temporary or permanent relocation. |
3.5 | Because of the autonomous nature of your role, the duration of your working time is not measured, monitored or determined by the Company and the limit on weekly working time set out in Regulation 4 of the Working Time Regulations 1998 does not apply to your employment. |
4. | Discretionary Bonus |
4.1 | You may be eligible to participate in certain discretionary bonus schemes determined by the Company in accordance with the Company's discretionary bonus arrangements announced and communicated to you from time to time. In the event that the Company decides to operate any bonus scheme from time to time in which you are eligible to participate, no bonus is payable: |
4.1.1 | during or in respect of any period: (a) whilst you are suspended under clause 13.2; or (b) in which the Company exercises its rights under clause 13.3; or |
4.1.2 | if on the date of payment your employment has terminated (for any reason) or you are serving any notice period (whether such notice has been given by you or the Company). |
4.2 | Payment of bonus on one occasion shall not give rise to any right to or expectation of payment of any bonus thereafter. |
4.3 | Announcement of a bonus scheme on one occasion shall not give rise to any right to or expectation of an announcement of any bonus scheme or schemes thereafter. |
5. | Pension & Life Assurance |
5.1 | During the Appointment, the Company shall pay to you a cash payment in lieu of active pension scheme membership at the rate of 25% of the salary provided from time to time pursuant to clause 3.2 above. Such payment shall accrue day-to-day and shall be payable by equal monthly instalments in arrears on or around the 28th day of each month but shall not form part of your salary for the purposes of calculating any other benefit, bonus or payment in lieu of notice as the case may be. |
5.2 | Your entitlement to a cash payment in lieu of active pension membership shall cease immediately in its entirety upon you becoming an active member of any Group Company pension scheme. |
5.3 | During the Appointment, the Company shall procure that you are covered by life assurance arrangements which shall pay to your dependants a sum equivalent to five times the salary provided from time to time pursuant to clause 3.2 above on the event of your death during the appointment. Such cover is subject to you making yourself available for medical assessment but shall not be subject to the Company obtaining medical underwriting for all or any part of the cover provided. |
6. | Car |
6.1 | You are entitled to be provided with a car on the terms set out in the Company Car Policy in force and as amended from time to time, a copy of which is available from Human Resources. |
7. | Expenses |
7.1 | Subject to the Company's guidelines in relation to reimbursement of expenses, the Company shall reimburse expenses reasonably incurred by you in the proper performance of your duties. |
7.2 | Any Company sponsored credit or charge card shall be used only for expenses reimbursable under clause 7.1 and shall be returned to the Company when requested. |
8. | Holiday |
8.1 | in addition to statutory holidays, you are entitled to take 30 working days holiday in each holiday year to be taken at such time or times as are agreed with the Board. |
8.2 | The holiday year is 1 st April to 31 st March. |
8.3 | You will forfeit any accrued but untaken holiday which has not been taken at the end of the holiday year but you will be entitled to carry forward up to one week's accrued but untaken holiday into the next holiday year with the agreement of the Board. |
8.4 | if your employment is terminated for whatever reason during a holiday year, other than in accordance with clause 12.2, your holiday entitlement will be calculated as being 1/12 th of your annual holiday entitlement for each completed calendar month worked prior to termination. |
8.5 | The Company reserves the right to deduct any amount of holiday pay paid in excess of accrued entitlement from any sums due at termination or to require the reimbursement of any such amounts. |
8.6 | If either party serves notice to terminate this Agreement, the Company may require you to take any accrued but unused holiday entitlement during the notice period (whether or not you are on Garden Leave). |
8.7 | Further details regarding your holiday entitlement are set out in the Employee Handbook. |
9. | Illness, injury or incapacity |
9.1 | If you are prevented by illness injury or other incapacity from properly performing your duties, you must comply with the notification and certification procedure detailed in the Employee Handbook. |
9.2 | Information relating to the Company's non-contractual and discretionary Company Sick Pay scheme is contained within the Employee Handbook. |
9.3 | In the event that you are unable to attend work due to illness or injury because of the actionable negligence of a third party in respect of which damages are recoverable, you shall advise the Company forthwith and all payments made by the Company to you during such incapacity shall constitute a loan to you to the extent that any compensation recovered from the third party shall be repaid by you to the Company. |
9.4 | If you are absent from work due to illness, injury or incapacity for a consecutive period of 90 working days the Company may (without prejudice to the provisions of clause 2.1) appoint another person or persons to perform your duties until you return to work. |
10. | Intellectual Property Rights |
10.1 | If whilst you are employed by the Company (whether or not in the course of your duties) you, whether alone or jointly, make or develop or modify any Intellectual Property in connection with or relating to or capable of being used or adapted for use in the business of the Company or any Group Company: |
10.1.1 | all rights to the Intellectual Property which subsist (or which may in the future subsist) will on creation, rest in and be the exclusive property of the Company; |
10.1.2 | to the extent necessary to vest the Intellectual Property in the Company and subject to section 42 of the Patents Act 1977, you hereby assign to the Company all rights to the Intellectual Property, whether future or subsisting, for the full term throughout the world. |
10.2 | Where you alone or jointly make or develop or modify any Intellectual Property, you shall promptly disclose to the Company full details of the Intellectual Property and shall not disclose the Intellectual Property to any third party before so doing. |
10.3 | You shall maintain adequate written records and memoranda of all Intellectual Property and these will remain the sole property of the Company and: |
10.3.1 | you shall, at the request and expense of the Company, do everything necessary to enable the Company or its nominee to obtain the benefit of the Intellectual Property including, without limitation, securing patent or other protection in the United Kingdom or any part of the world; and |
10.3.2 | you waive any rights you may have in respect of the intellectual Property under sections 77 to 86 of the Copyright, Designs and Patents Act 1988, including the right to object to derogatory treatment. |
11. | Covenants during employment and confidential information |
11.1 | You agree that during your employment you have a general duty to act in good faith with respect to the Company and all Group Companies. |
11.2 | You agree that during your employment you will not: |
11.2.1 | (subject as otherwise provided in this sub-clause 11.2.1) have any Material Interest in any other business and including in any business which is in competition (in whole or in part) with any business carried on by the Company or any Group Company and/or which may require the disclosure or use of Confidential Information. You may have a Material Interest in another business (which is not in competition, as aforesaid, and will not require the disclosure or use of Confidential Information) if you obtain the prior written consent of the Company, such consent not to be unreasonably withheld; |
11.2.2 | other than for the proper performance of your duties remove from the Company's and/or any Group Company's premises or copy or allow others to remove or copy any Confidential Information or any other information which belongs to or relates to the Businesses of the Company or any Group Cornpany; |
11.2.3 | directly or indirectly (on your own behalf or on behalf of any other person) solicit or entice away any employee or consultant of the Company or any Group Company, or discourage any prospective employee or consultant from being employed or engaged by the Company or by any Group Company; |
11.2.4 | directly or indirectly (on your own behalf or on behalf of any other person) solicit the business or custom of any past current or prospective customer or supplier of the Company and/or any Group Company; |
11.2.5 | directly or indirectly (on your own behalf or on behalf of any other person) provide services and/or products to any past current or prospective customer of the Company and/or of any Group Company. |
11.3 | You shall not during your employment save only in the proper performance of your duties directly or indirectly disclose to any person or use any Confidential Information and you shall use all due care and diligence to prevent any loss, unauthorised disclosure or use of any Confidential Information. |
11.4 | You shall not during your employment directly or indirectly make publish or otherwise communicate any disparaging or derogatory statements whether in writing or otherwise concerning the Company or any Group Company, their officers, consultants, agents, shareholders, employees, suppliers or customers. |
11.5 | You shall not at any time after the Termination Date directly or indirectly disclose to any person or make any use of any Confidential Information. |
11.6 | Nothing in this Agreement will prevent the disclosure or use of Confidential Information pursuant to an order of a court of competent jurisdiction or regulatory body with powers to compel disclosure, provided that you shall, unless prohibited by law, give the Company as much notice as is reasonably practicable if: |
11.6.1 | any application is made to a court of which you are aware which relates to Confidential Information. You shall also, unless prohibited by applicable law, notify the Company of the making of any such court order; |
11.6.2 | any regulatory body has requested disclosure of Confidential Information by you; and |
11.6.3 | unless prohibited by applicable law, you shall consult with the Company prior to making any disclosure pursuant to any court order and/or requirement of a regulatory body and take steps reasonably required by the Company to disclose Confidential Information in a manner reasonably designed to preserve its confidential nature as far as reasonably practicable. |
11.7 | Neither you (nor any person in whom you have a Material Interest) shall without the prior consent of the Company receive any money or other benefit from any customer or supplier of the Company or of any Group Company, which is in excess of £100 in value. You will immediately advise the Company if any such money or other benefit in excess of £100 in value is received. |
11.8 | You agree that you will abide by the Company's Code of Conduct in force and as amended form time to time, a copy of which is set out in the Employee Handbook and is also available from Human Resources. |
12. | Termination |
12.1 | Subject to clauses 12.2, 12.3 and 12.4, your employment may be terminated: |
12.1.1 | by the Company giving you not less than twelve months' prior written notice; or |
12.1.2 | by you giving the Company not less than twelve months' prior written notice. |
12.2 | The Company may terminate your employment without notice or payment in lieu of notice on grounds of gross misconduct. In the event of termination effected in accordance with this clause 12.2, you will have no entitlement to any bonus and payment in respect of any accrued but untaken holiday will be limited to a maximum payment of £10 (gross). The Company will be entitled to adjust any salary owed to you accordingly. |
12.3 | The Company may also terminate your employment without notice or payment in lieu of notice if you: |
12.3.1 | seriously fail or neglect to discharge your duties effectively and diligently or to carry out all lawful directions of the Board, the Company and/or its holding company; |
12.3.2 | commit any act of dishonesty or any other act which may bring the Company or any Group Company into disrepute; |
12.3.3 | become bankrupt or make any arrangement or composition with your creditors generally; or |
12.3.4 | seriously contravene any model code or relevant legislation or regulatory rules from time to time applicable to directors and/or employees of the Company and/or any Group Company. |
12.4 | Your employment shall automatically terminate without notice or payment in lieu of notice if you are, at the relevant time, a director of the Company or any Group Company and you cease to hold such office of director because you: |
(a) | become prohibited by law or any market regulation from being a director; or |
(b) | resign such office of director; or |
(c) | are required to vacate such office of director pursuant to the Articles of Association of the Company or Group Company. |
12.5 | On the giving of notice to terminate your employment or at any time during any notice period, the Company may in its absolute discretion (but is not obliged to) terminate your employment immediately by making a payment to you in lieu of your basic salary under clause 3.2 (less such deductions as the Company is required to make by law or as authorised by you (pursuant to the terms of this Agreement or otherwise)) for any unexpired portion of the notice period. Such payment in lieu of notice will be made to you in equal monthly instalments, commencing in the calendar month immediately after the Termination Date, until such time as you secure alternative employment or the notice period to which the instalments relate expires (whichever is earlier), subject to you providing to the Company such evidence as it may reasonably require on a monthly basis to show that you are making reasonable endeavours to secure alternative employment. You will not, however, be obliged to accept alternative employment which is not appropriate to your status and skills. In the event that you do secure alternative employment but at a lower basic salary, then subsequent instalments shall be reduced by an amount equivalent to such lower basic salary, provided that the remuneration arrangements agreed by you with your new employer are appropriately balanced between basic salary and other benefits in accordance with market practice. In the absence of such evidence or if the Company is not reasonably satisfied that the evidence provided shows that you are making reasonable endeavours to secure alternative employment, the Company may cease making payment of the monthly instalments referred to in this clause after giving you one month's written notice of such cessation and the reasons for it. In such circumstances, you will have no rights to any compensation whatsoever in respect of the loss of any further instalments of the payment in lieu of notice that would otherwise be due to you. For the purposes of this clause, "alternative employment" means any office, appointment, employment or self-employment under the terms of a contract of service or contract for services or otherwise. |
12.6 | On the termination of your employment for whatever reason, you shall at the request of the Company resign from all and any offices which you may hold as a director, nominee or representative of any Group Company and, if you should fail to do so within seven days, the Company is hereby irrevocably authorised to appoint some person in your name and on your behalf to sign any documents or do any things necessary or requisite to effect such resignation(s) and/or transfer(s). |
12.7 | On the termination of your employment (or earlier if requested by the Company) you shall immediately return to the Company all Confidential Information and ail other information property equipment and materials of any nature (whether copies, originals or extracts) in your possession or control relating to the Company, any Group Company and/or any customer, supplier or contact of the Company and/or any Group Company (without keeping any copies) including relating to any Intellectual Property of the Company and/or any Group Company, any such information made or compiled by you, keys, correspondence, documents, files, papers, diagrams, books, records, security passes, computer disks, tapes, software, telephones and computers. In particular, if any information is held in electronic form, you shall (a) if the medium on which the same is stored belongs to the Company (and/or any Group Company) return that medium (with all such information) to the Company and (b) if the medium on which the same is stored belongs to you, provide a copy of all such information to the Company and when so requested to do so by the Company, permanently delete the same from the medium on which it is stored. |
12.8 | Where the Company exercises its rights pursuant to clause 13.3, you agree to comply forthwith with the provisions of clause 12.7 above. However, you shall not be obliged to return any property provided to you as a contractual benefit. |
12.9 | If so required by the Company, you shall on each occasion you are obliged to deliver up property or delete information pursuant to this clause 12 provide to the Company a signed statement identifying the property returned and confirming that you have fully complied with your obligations under this clause. |
13. | Suspension and Garden Leave |
13.1 | Nothing in this Agreement shall be taken to mean that the Company is obliged to provide you with any work or that you are entitled to perform work for the Company and/or any Group Company. |
13.2 | The Company shall be entitled at any time to suspend you and require you not to attend work for such period as the Company, acting reasonably, may specify in order to investigate a suspected disciplinary matter or for any other reason considered appropriate by the Company (acting reasonably). |
13.3 | At any time following a notice given by either party to terminate your employment and at any time during this Agreement and for a period not exceeding twelve months: |
13.3.1 | the Company may in its absolute discretion elect not to provide you with any work (and you shall have no right to perform any work) and/or the Company may in its absolute discretion require you to perform such duties (if any) commensurate with your role as the Company deems to be appropriate during your normal working hours; and |
13.3.2 | the Company may in its absolute discretion exclude you from its premises and the premises of any Group Company and may direct you to cease all contact with any customers, suppliers, contractors or employees of the Company or any Group Company. |
13.4 | You shall at all times when rights are exercised under clause 13.3 remain readily accessible and available for work and otherwise comply with this Agreement and in particular this clause 13. |
13.5 | The exercise by the Company of any rights under clause 13.3 shall not constitute a breach of this Agreement of any kind whatsoever in respect of which you have any claim against the Company. The Company's rights under clause 13.3 are without prejudice to any other rights and remedies available to the Company. |
13.6 | Throughout any period in which the Company exercises its rights under clause 13.3, you shall continue to receive salary and other contractual benefits (but subject to clause 4.1.1), provided that if you are not accessible and available for work, all rights to salary and other benefits in respect of the period of non-availability shall be forfeited. |
14. | Disciplinary, grievance and appeals procedures |
14.1 | Information relating to the Company's disciplinary, grievance and appeals procedures is contained within the Employee Handbook. |
15. | Security Rules |
15.1 | Information relating to the Company's security rules is contained within the Employee Handbook. The Company also reserves the right to search all employees and vehicles on Group Company sites. |
16. | Obligations after employment |
16.1 | You shall not, during the Restricted Period, directly or indirectly: |
16.1.1 | hold any Material Interest in any business which is or shall be wholly or partly in competition with the Businesses in the Restricted Area including (to the extent that the same carry on a business in the Restricted Area which is competitive with the Businesses) those organisations listed in Schedule 2 and their holding companies and subsidiaries and the subsidiaries of any such holding companies from time to time; |
16.1.2 | hold any Material Interest in any organisation, which requires you to disclose or make use of any Confidential Information. |
16.2 | You shall not, directly or indirectly, whether as a principal, employee, partner, director, consultant, sub-contractor, shareholder or otherwise howsoever on your own behalf or on behalf of any other person during the Restricted Period in competition with the Businesses: |
16.2.1 | solicit any business, orders or custom for any Products or Services from any Customer; |
16.2.2 | solicit any business, orders or custom for any Products or Services from any Potential Customer; |
16.2.3 | accept any business orders or custom for any Products or Services from any Customer; |
16.2.4 | accept any business orders or custom for any Products or Services from any Potential Customer; |
16.2.5 | take such steps as may interfere with the continuance of supplies to the Company and/or any Group Company by any supplier; |
16.2.6 | solicit or entice away or seek to solicit or entice away from the Company or any Group Company (or knowingly assist or procure any other person to do so) any Employee or Contractor and whether or not such person would breach his or her contract of employment or engagement by reason of leaving the service of the Company or a Group Company as the case may be; or |
16.2.7 | engage (or knowingly assist or procure any other person to engage) any Employee or Contractor. |
16.3 | You shall not directly or indirectly whether as principal, employee, partner, director, consultant, sub-contractor, shareholder or otherwise howsoever on your own behalf or on behalf of any other person: |
16.3.1 | at any time after the Termination Date induce or seek to induce by any means involving the disclosure or use of Confidential Information any Customer or any other customer or any supplier to cease dealing with, reduce its business with or vary or restrict the terms on which it will deal with the Company or any Group Company; |
16.3.2 | at any time after the Termination Date represent yourself or permit yourself to be held out by any person as being in any way connected with or interested in the Company or any Group Company (save as the holder of shares if such be the case); or |
16.3.3 | at any time after the Termination Date make, publish or otherwise communicate any disparaging or derogatory statements whether in writing or otherwise concerning the Company or any Group Company, their officers, consultants, agents, shareholders or employees. |
16.4 | You acknowledge that any and all lists or data relating to any of your contacts from time to time with customers of the Company and/or any Group Company are the property of the Company and/or its Group Companies, and may constitute Confidential Information of the Company and/or any Group Company and that you have no interest, right or entitlement to maintain particular lists, data or accounts with any particular customer of the Company and/or its Group Companies. You shall not exploit your relationships with the customers of the Company and/or any Group Company except in the proper course of your duties for the Company. You agree that the Company or its Group Companies shall be entitled in their sole discretion from time to time (including during any period of notice) to require you to terminate any or all such relationships, hand over any or all lists or data relating to such relationships or accounts to persons nominated by the Company or its Group Companies (including to other employees of the Company or its Group Companies) and/or to seek to generate and maintain relationships or accounts with other existing or new customers. |
16.5 | The parties agree that the restrictions contained in clauses 11 and 16 are without prejudice to any other duties (fiduciary or otherwise) owed to the Company or any Group Company and are reasonable and necessary for the protection of legitimate interests of the Company and each Group Company and that, having regard to those interests, those restrictions do not work unreasonably on you. It is nevertheless agreed that if any of those restrictions shall taken together or separately be held to be void or ineffective for any reason but would be held to be valid and effective if any restriction or restrictions or part of the wording were deleted then the said restriction shall apply with such deletions as may be necessary to make the same valid and effective. |
16.6 | The restrictions contained in each sub-clause of clauses 11 and 16 shall be construed as separate and individual restrictions and shall each be capable of being severed without prejudice to the other restrictions or to the remaining provisions of this Agreement. |
16.7 | You acknowledge that if you breach any of your obligations contained in this Agreement (including those contained in clauses 11 and 16) then the Company may seek damages from you for any loss or damage suffered by the Company and/or any Group Company as a result of your breach. You also acknowledge and agree that damages alone would not be a sufficient remedy for any breach of clauses 11 and 16. |
16.8 | You have given the undertakings contained in clauses 11 and 16 to the Company for itself and as trustee for each Group Company and you will at the request and cost of the Company enter into direct undertakings with any Group Company which correspond to the undertakings in clauses 11 and 16, or which are less onerous only to the extent necessary (in the opinion of the Company or its legal advisers) to ensure that such undertakings are valid and enforceable. |
16.9 | If the Company transfers all or any part of its business to a third party ("the transferee"), the restrictions contained in clauses 11 and 16 shall, with effect from the date you become an employee of the transferee, apply to you as if references to the Company included the transferee and references to any Group Company were construed accordingly and as if references to customers were to customers of the Company and/or the transferee and their respective Group Companies. |
16.10 | On receipt of any offer of employment or any other offer of an engagement or arrangement made to you by any third party at any time during which any of the restrictions of this clause 16 are operative and/or which may give rise to a breach of any of your obligations under clause 11 or 16 you shall provide a copy of this Agreement to the relevant third party. |
17. | Data Protection |
17.1 | You agree that by signing this Agreement, you have given consent to the Company or any Group Company processing personal data concerning you in order to properly fulfil its obligations to you under your employment and as otherwise required by law in relation to your employment in accordance with the Data Protection Act 1998 ("the DPA"). Such processing will principally be for personnel, administrative and payroll purposes. |
17.2 | You acknowledge that, if you are required at any time to work on behalf of the Company or a Group Company overseas, the Company may need to pass your personal data to the person with whom you are working anywhere in the world and you consent to the Company doing so. |
17.3 | In the event that the Company or any Group Company needs to process any "sensitive personal data" (as defined by the DPA) in relation to you for its legitimate business needs, you undertake to sign on request such express consents as may be required to enable it to do so. |
17.
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Collective agreements
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17.1
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There are no collective agreements in force in relation to your employment
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18. | General |
18.1 | This Agreement and those parts of the Employee Handbook described as 'Terms and Conditions of Employment' constitute the entire employment contract between the Company and you and supersede and replace: (a) any and all previous terms and conditions of employment or for services between the Company or any Group Company and you (all of which shall be deemed to have terminated with immediate effect by mutual consent, but without prejudice to any liability for any prior breach); and (b) the terms of any offer letter or other correspondence between you and the Company relating to your employment. If there are any inconsistencies between the provisions of this Agreement and any other document, including the Employee Handbook, the provisions of this Agreement shall prevail. |
18.2 | This Agreement sets out all the salary and other benefits to which you are entitled. Any other benefits provided are non-contractual and if provided are provided in the absolute discretion of the Company and may be withdrawn or amended at any time. |
18.3 | The headings and sub-headings in this Agreement are for convenience only and do not affect its interpretation. |
18.4 | Any reference to a statutory provision shall be construed as a reference to any statutory modifications or re-enactment thereof (whether before or after the date hereof) for the time being in force. |
18.5 | The expiration or termination of this Agreement shall not affect the provisions of this Agreement as expressly or by implication are intended to have effect after that time and shall be without prejudice to any accrued rights or remedies of the parties. |
18.6 | The provisions of this Agreement are severable and distinct from one another and, if at any time any of the provisions is or becomes invalid, illegal or unenforceable, the validity, legality or enforceability of the other provisions shall not in any way be affected or impaired. |
18.7 | The parties agree that the Company may at any time on written notice to you assign the benefit and the burden of this Agreement to another person being a Group Company at the time of such assignment. Insofar as permitted by law, you hereby waive any right or rights you may have, whether statutory or otherwise, to object to being employed by such new employer. |
18.8 | Nothing in this Agreement shall confer or is intended to confer on any third party who is not a party to this Agreement any benefit or the right to enforce any provision of this Agreement pursuant to the Contracts (Rights of Third Parties) Act 1999. |
18.9 | The existence, effect and interpretation of this Agreement shall be governed by the laws of England and the parties submit to the exclusive jurisdiction of the courts of England. |
SIGNED
by:
|
SIGNED
by:
|
|
/s/ Simon Roberts | /s/ Alex Gourlay | |
Simon Roberts |
Alex Gourlay
|
|
Chief Executive, Health & Beauty Division, | ||
7.11.2013
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Alliance Boots | |
For and on behalf of Boots Management Services Limited
|
1.1 | In this Agreement: |
'Appointment' | means your employment by the Company on the terms of this Agreement. |
`Board' | means the board of directors from time to time of the Company (including any committee of the Board duly appointed by it). |
'Businesses' | means all commercial activities of Boots UK Limited or any Group Company: |
(a) | with which you shall have been concerned or involved at any time during the period of 12 months ending on the Termination Date; or |
(b) | in respect of which you possess Confidential Information; or |
(c) | which Boots UK Limited or any Group Company shall at the Termination Date have determined to carry on or take any ownership interest in, in the immediate or foreseeable future and in relation to which you shall at the Termination Date possess any Confidential Information. |
'Confidential Information' | means all confidential and/or trade secret information of the Company and/or any Group Company (whether or not recorded in any permanent, written or electronic form and whether or not marked as confidential) including marketing information, information relating to planned products/services, distribution techniques, sales, merchandising and pricing information, information relating to customers/suppliers (including names, contact details and actual or proposed business), financial corporate and strategic information, business projections and targets, business methods or plans, technical information, know how, inventions, research and development information, information relating to senior management succession details, employee records and other information in respect of which the Company or any Group Company owes an obligation of confidentiality to any third party, but shall not include any information which is in or comes into the public domain otherwise than as a result of any unauthorised disclosure by you or any other person who owes the Company and/or any Group Company an obligation of confidentiality in relation to the information disclosed. |
'Customer' | means any customer of Boots UK Limited or of any Group Company: |
(a) | with whom you have directly or indirectly dealt in the period of 12 months prior to the Termination Date; or |
(b) | in respect of whom you had knowledge of Confidential Information at the Termination Date; or |
(c) | in respect of whom you had as a result of your employment with the Company and/or any Group Company developed a business relationship. |
'Employee Handbook' | means the Boots & Me Employee Handbook, as from time to time amended or replaced. |
'Employee or Contractor' | means any person who is and was at the Termination Date employed or engaged (as an employee or self-employed contractor) by the Company or any Group Company to work in any of their businesses: |
(a) | at the same level as you; or |
(b) | whose total remuneration package (including salary, bonus, commission and all benefits in kind) was equal to or more than £50,000 (gross) in the period of 12 months prior to the Termination Date. |
'Garden Leave' | means any period during which the Company exercises its rights under clause 13.3. |
'Group Company' | means Alliance Boots Holdings Limited and its holding companies and subsidiaries and the subsidiaries of any such holding companies from time to time. |
'Intellectual Property' | means all patents, inventions, processes, discoveries, trade marks, logos, design rights, registered designs, semi-conductor topography rights, copyright, database right, know-how, trade secrets and all such similar proprietary rights and applications for such rights wheresoever subsisting and whether available by registration or not and any part or parts thereof. |
'Material Interest' | means: |
(a) | the holding of any position as director, officer, employee, consultant, partner, sub-contractor, principal or agent; or any other position in or control over any person which enables you directly or indirectly to exercise influence; |
(b) | the direct or indirect control or ownership (whether jointly or alone) of any shares (or any voting rights attached to them) or debentures save for the ownership for investment purposes only of not more than 1 per cent of the issued ordinary shares of any company whose shares are listed on any recognised investment exchange (as defined in section 285 of the Financial Services and Markets Act 2000). |
`Office' | means such offices commensurate with your position as a director or secretary in Boots UK Limited or any Group Company. |
'Potential Customer' | means any person with whom during the period of six months prior to the Termination Date Boots UK Limited or any Group Company was in negotiation for the provision of Products or Services if you had been directly or indirectly concerned in such negotiations and/or in respect of which negotiation you had knowledge of Confidential Information at the Termination Date. |
'Products' | means products in the range of products supplied by Boots UK Limited or any Group Company in the period of 12 months prior to the Termination Date. |
'Restricted Area' | means England, Scotland, Wales, Northern Ireland, Republic of Ireland, the Channel Islands, Isle of Man, France, Italy, Spain, Portugal, Holland, Norway, Switzerland, the Czech Republic, Turkey, Egypt, Germany, Russia, Romania, China, USA or any other country in which the Company or any Group Company has at the Termination Date a material business interest or is at the Termination Date planning to take a material business interest within 12 months of the Termination Date. |
'Restricted Period' | means 12 months from the Termination Date less any period in which the Company has exercised its rights under clause 13.3. |
'Services' | means services in the range of services supplied by Boots UK Limited or any Group Company in the period of 12 months prior to the Termination Date |
'Termination Date' | means the date of termination of your employment with the Company. |
1.2 | In this Agreement, any phase introduced by the terms "including", "include", "in particular" or any similar expression shall be construed as illustrative and shall not limit the sense of the words preceding those terms. |
1. | Effect of certain words and expressions |
1.1 | Certain words and expressions have particular meanings in this Agreement. Please refer to Schedule 1. |
2. | Appointment |
2.1 | With effect from the date of this Agreement (the "Commencement Date"), in consideration of the mutual covenants and agreements herein, the Company appoints you and you agree to act as Managing Director, Health & Beauty International and Brands. You agree that the Company may at its discretion require you to perform, without additional remuneration, other lawful duties or reasonable tasks not specifically within the scope of your normal duties but consistent with your seniority and professional skills and you agree to perform those duties/tasks. The Company may appoint someone to act jointly with you in the performance of your duties. |
2.2 | You shall at all times during this Agreement comply with all policies, procedures and practices of the Company from time to time notified to you by the Company. |
2.3 | At all times during the continuance of this Agreement you shall: |
2.3.1 | devote the whole of your working time and attention to the duties of the Appointment assigned to you from time to time; |
2.3.2 | use your best endeavours to promote and protect the interests of the Company and all Group Companies; |
2.3.3 | faithfully and diligently serve the Company and perform such duties and exercise such powers as may from time to time be assigned to or vested in you; |
2.3.4 | obey all reasonable and lawful directions given to you by or under authority of the Board; |
2.3.5 | make such reports to the Board on any matters within your knowledge concerning the affairs of the Company or any Group Company as are reasonably required. |
2.4 | You shall be a director of Boots UK Limited and: |
2.4.1 | shall hold such Office as the Company may from time to time reasonably require; |
2.4.2 | (if the Company so requests and in any event on termination of the Appointment) shall immediately resign without claim for compensation from any Office held in any Group Company (but without prejudice to any rights you may have to claim compensation in respect of termination of the Appointment); |
2.4.3 | shall not do anything that would cause you to be disqualified from holding any Office; |
2.4.4 | shall not (without the prior written approval of the Board) resign from any Office which you hold in any Group Company or any trusteeship which you hold as a result of the Appointment; |
2.5 | You hereby warrant that you are free to take up this employment and are not subject to any restriction that might hinder or prevent the full performance of your duties. |
2.6 | Your continuous period of employment with the Company commenced on [Date]. |
3. | Hours of Work, Place of Work and Salary |
3.1 | You shall work such hours as are reasonably necessary for the proper performance of your duties. |
3.2 | The Company shall, with effect from the Commencement Date, pay you a basic salary of £450,000 per year, paid by direct credit transfer to your nominated bank or building society on or around the 28th of each calendar month in arrears. Such basic salary includes any fees receivable by you as Officer, nominee or representative of any Group Company. You shall not be entitled to any directors' fees in addition to your basic salary. Your basic salary will be reviewed annually but the Company will be under no obligation to award an increase. The Company reserves the right to make deductions from your basic salary or other payments owed to you in order to recover any overpayments made to you in error. |
3.3 | Subject to clause 3.4, you shall perform your duties at the Company's Nottingham Support Office and you may be required to travel within the UK or abroad from time to time in the performance of your duties. |
3.4 | Due to the nature of the Company's business and the work you will be required to do, the Company may from time to time, on giving you reasonable notice, require you to work on a temporary or permanent basis at any of its offices or those of its Group Companies. The Company will pay your reasonable expenses incurred in connection with any temporary or permanent relocation. |
3.5 | Because of the autonomous nature of your role, the duration of your working time is not measured, monitored or determined by the Company and the limit on weekly working time set out in Regulation 4 of the Working Time Regulations 1998 does not apply to your employment. |
4. | Discretionary Bonus |
4.1 | You may be eligible to participate in certain discretionary bonus schemes determined by the Company in accordance with the Company's discretionary bonus arrangements announced and communicated to you from time to time. In the event that the Company decides to operate any bonus scheme from time to time in which you are eligible to participate, no bonus is payable: |
4.1.1 | during or in respect of any period: (a) whilst you are suspended under clause 13.2; or (b) in which the Company exercises its rights under clause 13.3; or |
4.1.2 | if on the date of payment your employment has terminated (for any reason) or you are serving any notice period (whether such notice has been given by you or the Company). |
4.2 | Payment of bonus on one occasion shall not give rise to any right to or expectation of payment of any bonus thereafter. |
4.3 | Announcement of a bonus scheme on one occasion shall not give rise to any right to or expectation of an announcement of any bonus scheme or schemes thereafter. |
5. | Pension & Life Assurance |
5.1 | During the Appointment, the Company shall pay to you a cash payment in lieu of active pension scheme membership at the rate of 25% of the salary provided from time to time pursuant to clause 3.2 above. Such payment shall accrue day-to-day and shall be payable by equal monthly instalments in arrears on or around the 28th day of each month but shall not form part of your salary for the purposes of calculating any other benefit, bonus or payment in lieu of notice as the case may be. |
5.2 | Your entitlement to a cash payment in lieu of active pension membership shall cease immediately in its entirety upon you becoming an active member of any Group Company pension scheme. |
5.3 | During the Appointment, the Company shall procure that you are covered by life assurance arrangements which shall pay to your dependants a sum equivalent to five times the salary provided from time to time pursuant to clause 3.2 above on the event of your death during the appointment. Such cover is subject to you making yourself available for medical assessment but shall not be subject to the Company obtaining medical underwriting for all or any part of the cover provided. |
6. | Car |
6.1 | You are entitled to be provided with a car on the terms set out in the Company Car Policy in force and as amended from time to time, a copy of which is available from Human Resources. |
7. | Expenses |
7.1 | Subject to the Company's guidelines in relation to reimbursement of expenses, the Company shall reimburse expenses reasonably incurred by you in the proper performance of your duties. |
7.2 | Any Company sponsored credit or charge card shall be used only for expenses reimbursable under clause 7.1 and shall be returned to the Company when requested. |
8. | Holiday |
8.1 | In addition to statutory holidays, you are entitled to take 30 working days holiday in each holiday year to be taken at such time or times as are agreed with the Board. |
8.2 | The holiday year is 1st April to 31st March. |
8.3 | You will forfeit any accrued but untaken holiday which has not been taken at the end of the holiday year but you will be entitled to carry forward up to one week's accrued but untaken holiday into the next holiday year with the agreement of the Board. |
8.4 | If your employment is terminated for whatever reason during a holiday year, other than in accordance with clause 12.2, your holiday entitlement will be calculated as being 1/12th of your annual holiday entitlement for each completed calendar month worked prior to termination. |
8.5 | The Company reserves the right to deduct any amount of holiday pay paid in excess of accrued entitlement from any sums due at termination or to require the reimbursement of any such amounts. |
8.6 | If either party serves notice to terminate this Agreement, the Company may require you to take any accrued but unused holiday entitlement during the notice period (whether or not you are on Garden Leave). |
8.7 | Further details regarding your holiday entitlement are set out in the Employee Handbook. |
9. | Illness, injury or incapacity |
9.1 | If you are prevented by illness injury or other incapacity from properly performing your duties, you must comply with the notification and certification procedure detailed in the Employee Handbook. |
9.2 | Information relating to the Company's non-contractual and discretionary Company Sick Pay scheme is contained within the Employee Handbook. |
9.3 | In the event that you are unable to attend work due to illness or injury because of the actionable negligence of a third party in respect of which damages are recoverable, you shall advise the Company forthwith and all payments made by the Company to you during such incapacity shall constitute a loan to you to the extent that any compensation recovered from the third party shall be repaid by you to the Company. |
9.4 | If you are absent from work due to illness, injury or incapacity for a consecutive period of 90 working days the Company may (without prejudice to the provisions of clause 2.1) appoint another person or persons to perform your duties until you return to work. |
10. | Intellectual Property Rights |
10.1 | If whilst you are employed by the Company (whether or not in the course of your duties) you, whether alone or jointly, make or develop or modify any Intellectual Property in connection with or relating to or capable of being used or adapted for use in the business of the Company or any Group Company: |
10.1.1 | all rights to the Intellectual Property which subsist (or which may in the future subsist) will on creation, rest in and be the exclusive property of the Company; |
10.1.2 | to the extent necessary to vest the Intellectual Property in the Company and subject to section 42 of the Patents Act 1977, you hereby assign to the Company all rights to the Intellectual Property, whether future or subsisting, for the full term throughout the world. |
10.2 | Where you alone or jointly make or develop or modify any Intellectual Property, you shall promptly disclose to the Company full details of the Intellectual Property and shall not disclose the Intellectual Property to any third party before so doing. |
10.3 | You shall maintain adequate written records and memoranda of all Intellectual Property and these will remain the sole property of the Company and: |
10.3.1 | you shall, at the request and expense of the Company, do everything necessary to enable the Company or its nominee to obtain the benefit of the Intellectual Property including, without limitation, securing patent or other protection in the United Kingdom or any part of the world; and |
10.3.2 | you waive any rights you may have in respect of the Intellectual Property under sections 77 to 86 of the Copyright, Designs and Patents Act 1988, including the right to object to derogatory treatment. |
11. | Covenants during employment and confidential information |
11.1 | You agree that during your employment you have a general duty to act in good faith with respect to the Company and all Group Companies. |
11.2 | You agree that during your employment you will not: |
11.2.1 | (subject as otherwise provided in this sub-clause 11.2.1) have any Material Interest in any other business and including in any business which is in competition (in whole or in part) with any business carried on by the Company or any Group Company and/or which may require the disclosure or use of Confidential Information. You may have a Material Interest in another business (which is not in competition, as aforesaid, and will not require the disclosure or use of Confidential Information) if you obtain the prior written consent of the Company, such consent not to be unreasonably withheld; |
11.2.2 | other than for the proper performance of your duties remove from the Company's and/or any Group Company's premises or copy or allow others to remove or copy any Confidential Information or any other information which belongs to or relates to the Businesses of the Company or any Group Company; |
11.2.3 | directly or indirectly (on your own behalf or on behalf of any other person) solicit or entice away any employee or consultant of the Company or any Group Company, or discourage any prospective employee or consultant from being employed or engaged by the Company or by any Group Company; |
11.2.4 | directly or indirectly (on your own behalf or on behalf of any other person) solicit the business or custom of any past current or prospective customer or supplier of the Company and/or any Group Company; |
11.2.5 | directly or indirectly (on your own behalf or on behalf of any other person) provide services and/or products to any past current or prospective customer of the Company and/or of any Group Company. |
11.3 | You shall not during your employment save only in the proper performance of your duties directly or indirectly disclose to any person or use any Confidential Information and you shall use all due care and diligence to prevent any loss, unauthorised disclosure or use of any Confidential Information. |
11.4 | You shall not during your employment directly or indirectly make publish or otherwise communicate any disparaging or derogatory statements whether in writing or otherwise concerning the Company or any Group Company, their officers, consultants, agents, shareholders, employees, suppliers or customers. |
11.5 | You shall not at any time after the Termination Date directly or indirectly disclose to any person or make any use of any Confidential Information. |
11.6 | Nothing in this Agreement will prevent the disclosure or use of Confidential Information pursuant to an order of a court of competent jurisdiction or regulatory body with powers to compel disclosure, provided that you shall, unless prohibited by law, give the Company as much notice as is reasonably practicable if: |
11.6.1 | any application is made to a court of which you are aware which relates to Confidential Information. You shall also, unless prohibited by applicable law, notify the Company of the making of any such court order; |
11.6.2 | any regulatory body has requested disclosure of Confidential Information by you; and |
11.6.3 | unless prohibited by applicable law, you shall consult with the Company prior to making any disclosure pursuant to any court order and/or requirement of a regulatory body and take steps reasonably required by the Company to disclose Confidential Information in a manner reasonably designed to preserve its confidential nature as far as reasonably practicable. |
11.7 | Neither you (nor any person in whom you have a Material Interest) shall without the prior consent of the Company receive any money or other benefit from any customer or supplier of the Company or of any Group Company, which is in excess of £100 in value. You will immediately advise the Company if any such money or other benefit in excess of £100 in value is received. |
11.8 | You agree that you will abide by the Company's Code of Conduct in force and as amended form time to time, a copy of which is set out in the Employee Handbook and is also available from Human Resources. |
12. | Termination |
12.1 | Subject to clauses 12.2, 12.3 and 12.4, your employment may be terminated: |
12.1.1 | by the Company giving you not less than twelve months' prior written notice; or |
12.1.2 | by you giving the Company not less than twelve months' prior written notice. |
12.2 | The Company may terminate your employment without notice or payment in lieu of notice on grounds of gross misconduct. In the event of termination effected in accordance with this clause 12.2, you will have no entitlement to any bonus and payment in respect of any accrued but untaken holiday will be limited to a maximum payment of £10 (gross). The Company will be entitled to adjust any salary owed to you accordingly. |
12.3 | The Company may also terminate your employment without notice or payment in lieu of notice if you: |
12.3.1 | seriously fail or neglect to discharge your duties effectively and diligently or to carry out all lawful directions of the Board, the Company and/or its holding company; |
12.3.2 | commit any act of dishonesty or any other act which may bring the Company or any Group Company into disrepute; |
12.3.3 | become bankrupt or make any arrangement or composition with your creditors generally; or |
12.3.4 | seriously contravene any model code or relevant legislation or regulatory rules from time to time applicable to directors and/or employees of the Company and/or any Group Company. |
12.4 | Your employment shall automatically terminate without notice or payment in lieu of notice if you are, at the relevant time, a director of the Company or any Group Company and you cease to hold such office of director because you: |
(a) | become prohibited by law or any market regulation from being a director; or |
(b) | resign such office of director; or |
(c) | are required to vacate such office of director pursuant to the Articles of Association of the Company or Group Company. |
12.5 | On the giving of notice to terminate your employment or at any time during any notice period, the Company may in its absolute discretion (but is not obliged to) terminate your employment immediately by making a payment to you in lieu of your basic salary under clause 3.2 (less such deductions as the Company is required to make by law or as authorised by you (pursuant to the terms of this Agreement or otherwise)) for any unexpired portion of the notice period. Such payment in lieu of notice will be made to you in equal monthly instalments, commencing in the calendar month immediately after the Termination Date, until such time as you secure alternative employment or the notice period to which the instalments relate expires (whichever is earlier), subject to you providing to the Company such evidence as it may reasonably require on a monthly basis to show that you are making reasonable endeavours to secure alternative employment. You will not, however, be obliged to accept alternative employment which is not appropriate to your status and skills. In the event that you do secure alternative employment but at a lower basic salary, then subsequent instalments shall be reduced by an amount equivalent to such lower basic salary, provided that the remuneration arrangements agreed by you with your new employer are appropriately balanced between basic salary and other benefits in accordance with market practice. In the absence of such evidence or if the Company is not reasonably satisfied that the evidence provided shows that you are making reasonable endeavours to secure alternative employment, the Company may cease making payment of the monthly instalments referred to in this clause after giving you one month's written notice of such cessation and the reasons for it. In such circumstances, you will have no rights to any compensation whatsoever in respect of the loss of any further instalments of the payment in lieu of notice that would otherwise be due to you. For the purposes of this clause, "alternative employment" means any office, appointment, employment or self-employment under the terms of a contract of service or contract for services or otherwise. |
12.6 | On the termination of your employment for whatever reason, you shall at the request of the Company resign from all and any offices which you may hold as a director, nominee or representative of any Group Company and, if you should fail to do so within seven days, the Company is hereby irrevocably authorised to appoint some person in your name and on your behalf to sign any documents or do any things necessary or requisite to effect such resignation(s) and/or transfer(s). |
12.7 | On the termination of your employment (or earlier if requested by the Company) you shall immediately return to the Company all Confidential Information and all other information property equipment and materials of any nature (whether copies, originals or extracts) in your possession or control relating to the Company, any Group Company and/or any customer, supplier or contact of the Company and/or any Group Company (without keeping any copies) including relating to any Intellectual Property of the Company and/or any Group Company, any such information made or compiled by you, keys, correspondence, documents, files, papers, diagrams, books, records, security passes, computer disks, tapes, software, telephones and computers. In particular, if any information is held in electronic form, you shall (a) if the medium on which the same is stored belongs to the Company (and/or any Group Company) return that medium (with all such information) to the Company and (b) if the medium on which the same is stored belongs to you, provide a copy of all such information to the Company and when so requested to do so by the Company, permanently delete the same from the medium on which it is stored. |
12.8 | Where the Company exercises its rights pursuant to clause 13.3, you agree to comply forthwith with the provisions of clause 12.7 above. However, you shall not be obliged to return any property provided to you as a contractual benefit. |
12.9 | If so required by the Company, you shall on each occasion you are obliged to deliver up property or delete information pursuant to this clause 12 provide to the Company a signed statement identifying the property returned and confirming that you have fully complied with your obligations under this clause. |
13. | Suspension and Garden Leave |
13.1 | Nothing in this Agreement shall be taken to mean that the Company is obliged to provide you with any work or that you are entitled to perform work for the Company and/or any Group Company. |
13.2 | The Company shall be entitled at any time to suspend you and require you not to attend work for such period as the Company, acting reasonably, may specify in order to investigate a suspected disciplinary matter or for any other reason considered appropriate by the Company (acting reasonably). |
13.3 | At any time following a notice given by either party to terminate your employment and at any time during this Agreement and for a period not exceeding twelve months: |
13.3.1 | the Company may in its absolute discretion elect not to provide you with any work (and you shall have no right to perform any work) and/or the Company may in its absolute discretion require you to perform such duties (if any) commensurate with your role as the Company deems to be appropriate during your normal working hours; and |
13.3.2 | the Company may in its absolute discretion exclude you from its premises and the premises of any Group Company and may direct you to cease all contact with any customers, suppliers, contractors or employees of the Company or any Group Company. |
13.4 | You shall at all times when rights are exercised under clause 13.3 remain readily accessible and available for work and otherwise comply with this Agreement and in particular this clause 13. |
13.5 | The exercise by the Company of any rights under clause 13.3 shall not constitute a breach of this Agreement of any kind whatsoever in respect of which you have any claim against the Company. The Company's rights under clause 13.3 are without prejudice to any other rights and remedies available to the Company. |
13.6 | Throughout any period in which the Company exercises its rights under clause 13.3, you shall continue to receive salary and other contractual benefits (but subject to clause 4.1.1), provided that if you are not accessible and available for work, all rights to salary and other benefits in respect of the period of non-availability shall be forfeited. |
14. | Disciplinary, grievance and appeals procedures |
14.1 | Information relating to the Company's disciplinary, grievance and appeals procedures is contained within the Employee Handbook. |
15. | Security Rules |
15.1 | Information relating to the Company's security rules is contained within the Employee Handbook. The Company also reserves the right to search all employees and vehicles on Group Company sites. |
16. | Obligations after employment |
16.1 | You shall not, during the Restricted Period, directly or indirectly: |
16.1.1 | hold any Material Interest in any business which is or shall be wholly or partly in competition with the Businesses in the Restricted Area including (to the extent that the same carry on a business in the Restricted Area which is competitive with the Businesses) those organisations listed in Schedule 2 and their holding companies and subsidiaries and the subsidiaries of any such holding companies from time to time; |
16.1.2 | hold any Material Interest in any organisation, which requires you to disclose or make use of any Confidential Information. |
16.2 | You shall not, directly or indirectly, whether as a principal, employee, partner, director, consultant, sub-contractor, shareholder or otherwise howsoever on your own behalf or on behalf of any other person during the Restricted Period in competition with the Businesses: |
16.2.1 | solicit any business, orders or custom for any Products or Services from any Customer; |
16.2.2 | solicit any business, orders or custom for any Products or Services from any Potential Customer; |
16.2.3 | accept any business orders or custom for any Products or Services from any Customer; |
16.2.4 | accept any business orders or custom for any Products or Services from any Potential Customer; |
16.2.5 | take such steps as may interfere with the continuance of supplies to the Company and/or any Group Company by any supplier; |
16.2.6 | solicit or entice away or seek to solicit or entice away from the Company or any Group Company (or knowingly assist or procure any other person to do so) any Employee or Contractor and whether or not such person would breach his or her contract of employment or engagement by reason of leaving the service of the Company or a Group Company as the case may be; or |
16.2.7 | engage (or knowingly assist or procure any other person to engage) any Employee or Contractor. |
16.3 | You shall not directly or indirectly whether as principal, employee, partner, director, consultant, sub-contractor, shareholder or otherwise howsoever on your own behalf or on behalf of any other person: |
16.3.1 | at any time after the Termination Date induce or seek to induce by any means involving the disclosure or use of Confidential Information any Customer or any other customer or any supplier to cease dealing with, reduce its business with or vary or restrict the terms on which it will deal with the Company or any Group Company; |
16.3.2 | at any time after the Termination Date represent yourself or permit yourself to be held out by any person as being in any way connected with or interested in the Company or any Group Company (save as the holder of shares if such be the case); or |
16.3.3 | at any time after the Termination Date make, publish or otherwise communicate any disparaging or derogatory statements whether in writing or otherwise concerning the Company or any Group Company, their officers, consultants, agents, shareholders or employees. |
16.4 | You acknowledge that any and all lists or data relating to any of your contacts from time to time with customers of the Company and/or any Group Company are the property of the Company and/or its Group Companies, and may constitute Confidential Information of the Company and/or any Group Company and that you have no interest, right or entitlement to maintain particular lists, data or accounts with any particular customer of the Company and/or its Group Companies. You shall not exploit your relationships with the customers of the Company and/or any Group Company except in the proper course of your duties for the Company. You agree that the Company or its Group Companies shall be entitled in their sole discretion from time to time (including during any period of notice) to require you to terminate any or all such relationships, hand over any or all lists or data relating to such relationships or accounts to persons nominated by the Company or its Group Companies (including to other employees of the Company or its Group Companies) and/or to seek to generate and maintain relationships or accounts with other existing or new customers. |
16.5 | The parties agree that the restrictions contained in clauses 11 and 16 are without prejudice to any other duties (fiduciary or otherwise) owed to the Company or any Group Company and are reasonable and necessary for the protection of legitimate interests of the Company and each Group Company and that, having regard to those interests, those restrictions do not work unreasonably on you. It is nevertheless agreed that if any of those restrictions shall taken together or separately be held to be void or ineffective for any reason but would be held to be valid and effective if any restriction or restrictions or part of the wording were deleted then the said restriction shall apply with such deletions as may be necessary to make the same valid and effective. |
16.6 | The restrictions contained in each sub-clause of clauses 11 and 16 shall be construed as separate and individual restrictions and shall each be capable of being severed without prejudice to the other restrictions or to the remaining provisions of this Agreement. |
16.7 | You acknowledge that if you breach any of your obligations contained in this Agreement (including those contained in clauses 11 and 16) then the Company may seek damages from you for any loss or damage suffered by the Company and/or any Group Company as a result of your breach. You also acknowledge and agree that damages alone would not be a sufficient remedy for any breach of clauses 11 and 16. |
16.8 | You have given the undertakings contained in clauses 11 and 16 to the Company for itself and as trustee for each Group Company and you will at the request and cost of the Company enter into direct undertakings with any Group Company which correspond to the undertakings in clauses 11 and 16, or which are less onerous only to the extent necessary (in the opinion of the Company or its legal advisers) to ensure that such undertakings are valid and enforceable. |
16.9 | If the Company transfers all or any part of its business to a third party ("the transferee"), the restrictions contained in clauses 11 and 16 shall, with effect from the date you become an employee of the transferee, apply to you as if references to the Company included the transferee and references to any Group Company were construed accordingly and as if references to customers were to customers of the Company and/or the transferee and their respective Group Companies. |
16.10 | On receipt of any offer of employment or any other offer of an engagement or arrangement made to you by any third party at any time during which any of the restrictions of this clause 16 are operative and/or which may give rise to a breach of any of your obligations under clause 11 or 16 you shall provide a copy of this Agreement to the relevant third party. |
17. | Data Protection |
17.1 | You agree that by signing this Agreement, you have given consent to the Company or any Group Company processing personal data concerning you in order to properly fulfil its obligations to you under your employment and as otherwise required by law in relation to your employment in accordance with the Data Protection Act 1998 ("the DPA"). Such processing will principally be for personnel, administrative and payroll purposes. |
17.2 | You acknowledge that, if you are required at any time to work on behalf of the Company or a Group Company overseas, the Company may need to pass your personal data to the person with whom you are working anywhere in the world and you consent to the Company doing so. |
17.3 | In the event that the Company or any Group Company needs to process any "sensitive personal data" (as defined by the DPA) in relation to you for its legitimate business needs, you undertake to sign on request such express consents as may be required to enable it to do so. |
18. | Collective agreements |
18.1 | There are no collective agreements in force in relation to your employment. |
19. | General |
19.1 | This Agreement and those parts of the Employee Handbook described as 'Terms and Conditions of Employment' constitute the entire employment contract between the Company and you and supersede and replace: (a) any and all previous terms and conditions of employment or for services between the Company or any Group Company and you (all of which shall be deemed to have terminated with immediate effect by mutual consent, but without prejudice to any liability for any prior breach); and (b) the terms of any offer letter or other correspondence between you and the Company relating to your employment. If there are any inconsistencies between the provisions of this Agreement and any other document, including the Employee Handbook, the provisions of this Agreement shall prevail. |
19.2 | This Agreement sets out all the salary and other benefits to which you are entitled. Any other benefits provided are non-contractual and if provided are provided in the absolute discretion of the Company and may be withdrawn or amended at any time. |
19.3 | The headings and sub-headings in this Agreement are for convenience only and do not affect its interpretation. |
19.4 | Any reference to a statutory provision shall be construed as a reference to any statutory modifications or re-enactment thereof (whether before or after the date hereof) for the time being in force. |
19.5 | The expiration or termination of this Agreement shall not affect the provisions of this Agreement as expressly or by implication are intended to have effect after that time and shall be without prejudice to any accrued rights or remedies of the parties. |
19.6 | The provisions of this Agreement are severable and distinct from one another and, if at any time any of the provisions is or becomes invalid, illegal or unenforceable, the validity, legality or enforceability of the other provisions shall not in any way be affected or impaired. |
19.7 | The parties agree that the Company may at any time on written notice to you assign the benefit and the burden of this Agreement to another person being a Group Company at the time of such assignment. Insofar as permitted by law, you hereby waive any right or rights you may have, whether statutory or otherwise, to object to being employed by such new employer. |
19.8 | Nothing in this Agreement shall confer or is intended to confer on any third party who is not a party to this Agreement any benefit or the right to enforce any provision of this Agreement pursuant to the Contracts (Rights of Third Parties) Act 1999. |
19.9 | The existence, effect and interpretation of this Agreement shall be governed by the laws of England and the parties submit to the exclusive jurisdiction of the courts of England. |
SIGNED
by:
|
SIGNED
by:
|
|
/s/ Ken Murphy | /s/ Alex Gourlay | |
Ken Murphy
|
Alex Gourlay
|
|
Chief Executive, Health & Beauty Division, | ||
Alliance Boots
|
||
For and on behalf of Boots Management Services | ||
Limited |
1.1 | In this Agreement: |
'Appointment' | means your employment by the Company on the terms of this Agreement. |
`Board' | means the board of directors from time to time of the Company (including any committee of the Board duly appointed by it). |
'Businesses' | means all commercial activities of Boots UK Limited or any Group Company: |
(a) | with which you shall have been concerned or involved at any time during the period of 12 months ending on the Termination Date; or |
(b) | in respect of which you possess Confidential Information; or |
(c) | which Boots UK Limited or any Group Company shall at the Termination Date have determined to carry on or take any ownership interest in, in the immediate or foreseeable future and in relation to which you shall at the Termination Date possess any Confidential Information. |
'Confidential Information' | means all confidential and/or trade secret information of the Company and/or any Group Company (whether or not recorded in any permanent, written or electronic form and whether or not marked as confidential) including marketing information, information relating to planned products/services, distribution techniques, sales, merchandising and pricing information, information relating to customers/suppliers (including names, contact details and actual or proposed business), financial corporate and strategic information, business projections and targets, business methods or plans, technical information, know how, inventions, research and development information, information relating to senior management succession details, employee records and other information in respect of which the Company or any Group Company owes an obligation of confidentiality to any third party, but shall not include any information which is in or comes into the public domain otherwise than as a result of any unauthorised disclosure by you or any other person who owes the Company and/or any Group Company an obligation of confidentiality in relation to the information disclosed. |
'Customer' | means any customer of Boots UK Limited or of any Group Company: |
(a) | with whom you have directly or indirectly dealt in the period of 12 months prior to the Termination Date; or |
(b) | in respect of whom you had knowledge of Confidential Information at the Termination Date; or |
(c) | in respect of whom you had as a result of your employment with the Company and/or any Group Company developed a business relationship. |
'Employee Handbook' | means the Boots & Me Employee Handbook, as from time to time amended or replaced. |
'Employee or Contractor' | means any person who is and was at the Termination Date employed or engaged (as an employee or self-employed contractor) by the Company or any Group Company to work in any of their businesses: |
(a) | at the same level as you; or |
(b) | whose total remuneration package (including salary, bonus, commission and all benefits in kind) was equal to or more than £50,000 (gross) in the period of 12 months prior to the Termination Date. |
'Garden Leave' | means any period during which the Company exercises its rights under clause 13.3. |
'Group Company' | means Alliance Boots Holdings Limited and its holding companies and subsidiaries of such holding companies from time to time. |
'Intellectual Property' | means all patents, inventions, processes, discoveries, trade marks, logos, design rights, registered designs, semi-conductor topography rights, copyright, database right, know-how, trade secrets and all such similar proprietary rights and applications for such rights wheresoever subsisting and whether available by registration or not and any part or parts thereof. |
'Material Interest' | means: |
(a) | the holding of any position as director, officer, employee, consultant, partner, sub-contractor, principal or agent; or any other position in or control over any person which enables you directly or indirectly to exercise influence; |
(b) | the direct or indirect control or ownership (whether jointly or alone) of any shares (or any voting rights attached to them) or debentures save for the ownership for investment purposes only of not more than 1 per cent of the issued ordinary shares of any company whose shares are listed on any recognised investment exchange (as defined in section 285 of the Financial Services and Markets Act 2000). |
`Office' | means such offices commensurate with your position as a director or secretary in Boots UK Limited or any Group Company. |
'Products' | means products in the range of products supplied by the Company or any Group Company in the period of 12 months prior to the Termination Date. |
'Restricted Area' | means England, Scotland, Wales, Northern Ireland, Republic of Ireland, the Channel Islands, Isle of Man, France, Italy, Spain, Portugal, Holland, Norway, Switzerland, the Czech Republic, Turkey, Egypt, Germany, Russia, Romania, China, USA or any other country in which Boots UK Limited or any Group Company has at the Termination Date a material business interest or is at the Termination Date planning to take a material business interest within 12 months of the Termination Date. |
'Restricted Period' | means 12 months from the Termination Date less any period in which the Company has exercised its rights under clause 13.3. |
'Services' | means services in the range of services supplied by Boots UK Limited or any Group Company in the period of 12 months prior to the Termination Date |
'Termination Date' | means the date of termination of your employment with the Company. |
1.2 | In this Agreement, any phase introduced by the terms "including", "include", "in particular" or any similar expression shall be construed as illustrative and shall not limit the sense of the words preceding those terms. |
· | Severance according to the current terms of the Walgreens Boots Alliance, Inc. Severance and Change in Control Plan as an involuntary termination for reasons other than cause; |
· | Vesting of any outstanding equity awards that would otherwise vest within one year of her termination date if she had remained an employee of the Company through such date; and |
· | Vesting of the unvested portion of the restricted stock unit (RSU) transition award granted to Ms. Reed on September 15, 2014. |
FRANCE
|
MEXICO
|
MONACO
|
NETHERLANDS
|
SPAIN
|
UNITED KINGDOM
|
(i) | You will be provided with security services and travel benefits consistent with your role and status with the Company, including but not limited to an assigned driver with appropriate security training, travel on the Company or charter aircraft for business (including travel to and from home) and, to the extent approved by the Compensation Committee, personal use . |
(ii) | You will be covered by the Employer’s personal accident and travel insurance scheme. |
|
Six Months Ended,
|
Twelve Months Ended August 31,
|
||||||||||||||||||||||
|
February 28, 2015
|
2014
|
2013
|
2012
|
2011
|
2010
|
||||||||||||||||||
Income before income tax provision
|
$
|
3,641
|
$
|
3,557
|
$
|
4,047
|
$
|
3,376
|
$
|
4,294
|
$
|
3,373
|
||||||||||||
Add:
|
||||||||||||||||||||||||
Minority Interests
|
-
|
-
|
5
|
-
|
-
|
-
|
||||||||||||||||||
Fixed charges
|
875
|
1,376
|
1,383
|
1,260
|
1,212
|
1,100
|
||||||||||||||||||
Amortization of capitalized interest
|
1
|
6
|
7
|
6
|
5
|
-
|
||||||||||||||||||
Less:
|
||||||||||||||||||||||||
Equity earnings
|
(315
|
)
|
(617
|
)
|
(496
|
)
|
-
|
-
|
-
|
|||||||||||||||
Capitalized interest
|
(1
|
)
|
(6
|
)
|
(7
|
)
|
(9
|
)
|
(10
|
)
|
(12
|
)
|
||||||||||||
Earnings as defined
|
$
|
4,201
|
$
|
4,316
|
$
|
4,939
|
$
|
4,633
|
$
|
5,501
|
$
|
4,461
|
||||||||||||
Interest expense, net of capitalized interest
|
$
|
209
|
$
|
168
|
$
|
193
|
$
|
94
|
$
|
77
|
$
|
90
|
||||||||||||
Capitalized interest
|
1
|
6
|
7
|
9
|
10
|
12
|
||||||||||||||||||
Portions of rentals representative of the interest factor
|
665
|
1,202
|
1,183
|
1,157
|
1,125
|
998
|
||||||||||||||||||
Fixed charges as defined
|
$
|
875
|
$
|
1,376
|
$
|
1,383
|
$
|
1,260
|
$
|
1,212
|
$
|
1,100
|
||||||||||||
Ratio of earnings to fixed charges
|
4.80
|
3.14
|
3.57
|
3.68
|
4.54
|
4.06
|
(a) |
For the purpose of computing these ratios, "earnings" consist of earnings before income tax provision and before adjustment for income or loss from equity investees, interest, distributed income of equity-method investees, and the portions of rentals representative of the interest factor. "Fixed charges" consist of interest expense (which includes amortization of capitalized debt issuance costs), capitalized interest and the portions of rentals representative of the interest factor.
Walgreens Boots Alliance, Inc. is the successor of Walgreen Co. See Note 1 of the consolidated financial statements for further information
|
1. | I have reviewed this quarterly report on Form 10-Q of Walgreens Boots Alliance, Inc.; |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
4. | The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rule 13a-15(f) and 15d-15(f)) for the registrant and have: |
a) | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
b) | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
c) | Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
d) | Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and |
5. | The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions): |
a) | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and |
b) | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting. |
/s/
|
Stefano Pessina
|
Acting Chief Executive Officer
|
Date: April 9, 2015
|
|
Stefano Pessina
|
1. | I have reviewed this quarterly report on Form 10-Q of Walgreens Boots Alliance, Inc.; |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
4. | The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rule 13a-15(f) and 15d-15(f)) for the registrant and have: |
a) | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
b) | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
c) | Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
d) | Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and |
5. | The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions): |
a) | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and |
b) | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting. |
/s/
|
George Fairweather
|
Global Chief Financial Officer
|
Date: April 9, 2015
|
|
George Fairweather
|