Implementation Agreement – Corporate Restructure – Best Buy Co. Inc. and Carphone Warehouse Group PLC

Clause

Page

1.

Definitions and Interpretation

2

2.

The Transaction and Related Restructuring Arrangements

6

3.

Shareholders Agreement

7

4.

Implementation of the Transaction

7

5.

Confidential Information

7

6.

Assignment

8

7.

Costs

8

8.

Severability

8

9.

Variation, Waiver and Consent

9

10.

Rights and Remedies Cumulative

9

11.

Conflict

9

12.

Further Assurance

9

13.

Contracts (Rights of Third Parties) Act 1999

10

14.

Notices

10

15.

Counterparts

11

16.

Governing Law

11

17.

Jurisdiction

11

Schedule

SCHEDULE 1

Proposed Final Corporate Structure

12

(1)

BEST BUY CO., INC. a company registered in the State of
Minnesota whose registered office is at 7601 Penn Avenue South, Richfield, MN
55423, United States of America (“BBY Inc“); and

(2)

CARPHONE WAREHOUSE GROUP PLC (company number 3253714), a
company incorporated under the laws of England and Wales and whose registered
office is at 1 Portal Way, London W3 6RS (“CPW Plc“).

(A)

On 7 November 2011 the parties announced that they had, on 6 November 2011,
entered into heads of agreement (“Heads of Agreement“) in
respect of strategic business arrangements including in respect of Best Buy
Europe Distributions Limited (company number 6534088) (“BBE
Ltd“).

(B)

BBY Inc and CPW Plc each own, directly or indirectly, 50% of BBE Ltd. Their
relationship as shareholders of BBE Ltd is principally governed by the
Shareholders Agreement (defined below).

(C)

BBE Ltd and its subsidiary undertakings carry on business in Europe although
one of its subsidiary undertakings, CPW Mobile Limited (company number 6330995)
(“CPWM Ltd“), (together with its subsidiary undertakings) are
parties to a number of agreements including the Best Buy Mobile Agreement
(defined below) under which CPWM Ltd receives a licence payment in respect of
the BBYM Business (defined below).

(D)

BBY Inc and CPW Plc intend that BBE Ltd will no longer have any interest in
the BBYM business such that BBY Inc will own the entire beneficial and economic
interest in CPWM Ltd and CPW Plc will receive a cash dividend from New CPWM
(defined below).

(E)

In order to effect the proposed Transaction, the parties will implement a
multi-step restructuring of the existing corporate structure of the BBE Group
such that New BBEDL (as defined below) will become the new holding company of
the BBE Group (as defined below) of which BBY Inc and CPW Plc will each own 50%.
The parties will, as a result, terminate the Shareholders Agreement (as defined
below) and enter into the New Shareholders Agreement (as defined below) which
will in effect amend and restate the provisions of the Shareholders Agreement.

(F)

In connection with the Transaction the parties will also enter into a number
of other agreements to give effect to the Transaction and Heads of Agreement
including, without limitation, the Global Connect Agreement, the Option
Agreement and the Consultancy Agreement (each as defined below).

(G)

The parties wish to enter into this Agreement to set out certain mutual
commitments to implement the Transaction and other matters which are the subject
of the Heads of Agreement.

1.

DEFINITIONS AND INTERPRETATION

1.1

Defined Terms

“Affiliate“

means, with respect to any person, any person that directly, or indirectly
through one or more intermediaries, controls, or is controlled by, or is under
common control with, such person;

“Best Buy Mobile Agreement“

means the license agreement between CPWM Ltd and Best Buy Stores LP (a US
limited partnership within the BBY Inc group), dated July 8, 2007 (as amended
between the parties thereto);

“BBE Group“

means BBE Ltd and its subsidiaries from time to time;

“BBYM Business“

means the Business as defined in the Best Buy Mobile Agreement and carried on
in the United States and rights to any such Business carried on in Canada;

“Business Day“

means any day, other than a Saturday or Sunday, on which banks generally are
open in London for the transaction of normal business;

“Completion“

means completion of the Transaction which shall occur upon completion of step
8 of the Restructuring as detailed in the Steps Plan;

“Conditions“

means:

a)

obtaining CPW Plc shareholder approval in relation to the Transaction
(“Condition A”);

b)

obtaining all necessary consents from BBE Ltd’s existing finance provider in
relation to the Transaction (“Condition B”); and

c)

each of the parties delivering to the other executed copies of the New
Shareholders Agreement, the Global Connect Agreement, the Option Agreement, the
Consultancy Agreement and other agreements (as specified in the Heads of
Agreement) to give effect to the Transaction and the Heads of Agreement
(“Condition C”)

“Confidential Information“

means the terms of this Agreement and any other agreements entered into
between the parties or their Affiliates pursuant to or in connection with this
Agreement or the Transaction and any discussions or negotiations relating
thereto (whether before or after their execution) and all information disclosed
by a party or any of its Affiliates to the other party or any of its Affiliates
(whether in writing or orally), in connection with or for the purposes of this
Agreement or the Transaction and any information reasonably regarded as being
confidential which, in consequence of the negotiations relating to this
Agreement or the Transaction, any party (or any of its Affiliates) may have
otherwise acquired, or any party’s

business, assets or affairs;

“Consultancy Agreement“

means the agreement to be entered into between BBY Inc and CPW Plc under
which CPW Plc will provide certain consultancy services to BBY Inc;

“Global Connect Agreement“

means the agreement to be entered into between BBY Inc and CPW Plc in respect
of business arrangements in territories other than the United States, Canada and
Europe;

“Global Connect Business“

the businesses the subject of the Global Connect Agreement;

“Long Stop Date“

means 31 January 2012;

“New BBEDL“

means New BBED Limited (company number 7866062), which will become the new
holding company of BBE Ltd and which is to be incorporated in the course of the
Restructuring;

“New CPWM“

means New CPWM Limited (company number 7866069), which will become the new
holding company of CPWM Ltd and which is to be incorporated in the course of the
Restructuring;

“New Shareholders Agreement“

means an amended and restated form of the Shareholders Agreement to be
entered into by the parties on Completion, governing the relationship of the
parties as shareholders of New BBEDL;

“Notice“

means any notice, demand or other communication;

“Option Agreement“

means the option agreement to be entered into between BBY Inc and CPW Ltd
pursuant to which each party will grant to the other certain call and put
options in respect of their respective interests in New BBEDL and the Global
Connect Business;

“Payment“

means an amount of $1,303,401,600 to be paid in cash by way of dividend from
New CPWM to CPW Plc in accordance with clause 2.1 and the Steps Plan;

“Regulatory Requirement“

means all applicable laws and regulations and all applicable requirements,
rules, guidance and standards of any relevant regulatory authority from time to
time;

“Restructuring“

means the multi-step restructuring of the existing corporate structure of the
BBE Group to be implemented in connection with the Transaction and in accordance
with the Steps Plan in order to achieve the corporate structure set forth in
schedule 1;

“Shareholders Agreement“

means the shareholders agreement between CPW Plc, BBY Inc and BBE Ltd dated
30 June 2008 (as amended on 29 July 2009 and 28 January 2010);

“Steps Plan“

means the micro steps plan setting out those steps and actions required to be
implemented in connection with the

Restructuring and which the parties have signed by way of identification
dated 7 December 2011 and exchanged between themselves;

“Tax” or “Taxation“

means any and all forms of taxation and statutory, governmental, supra
governmental, state, principal, local governmental or municipal impositions,
duties, contributions, charges and levies in the nature of taxation and all
withholdings or deductions in respect thereof of whatever nature, in each case
wherever and whenever imposed, and all penalties, charges, costs and interest
relating thereto;

“Tax Authority“

means any taxing or other authority (wherever located) competent to impose
any liability to make actual payments of Tax (or amounts in respect of Tax); and

“Transaction“

means the transactions pursuant to which BBY Inc acquires the entire
beneficial and economic interest in CPWM Ltd and the BBYM business and CPW Plc
receives the Payment by way of dividend from New CPWM, to be achieved by
implementation and completion of the Restructuring and as more fully described
in clause 2.

1.2

Holding company and subsidiary

1.3

Recitals, schedules, etc.

1.4

Meaning of references

(a)

words importing one gender shall be treated as importing any gender, words
importing individuals shall be treated as importing corporations and vice versa,
words importing the singular shall be treated as importing the plural and vice
versa, and words importing the whole shall be treated as including a reference
to any part thereof;

(b)

references to a person shall include any individual, firm, body corporate,
unincorporated association, government, state or agency of state, association,
joint venture or partnership, in each case whether or not having a separate
legal personality. References to a company shall be construed so as to include
any

(c)

a party shall be construed so as to include its successors, permitted assigns
and permitted transferees;

(d)

this “Agreement” is a reference to this Agreement as amended
or varied in accordance with its terms;

(e)

references to the word “include” or
“including” (or any similar term) are not to be construed as
implying any limitation and general words introduced by the word
“other” (or any similar term) shall not be given a restrictive
meaning by reason of the fact that they are preceded by words indicating a
particular class of acts, matters or things;

(f)

references to any English statutory provision or legal term for any action,
remedy, method of judicial proceeding, legal document, legal status, court,
official or other legal concept, state of affairs or thing shall in respect of
any jurisdiction other than England be deemed to include that which most nearly
approximates in that jurisdiction to the English statutory provision or legal
term or other legal concept, state of affairs or thing;

(g)

references to “$” or “USD” are to the
lawful currency of the United States of America as at the date of this
Agreement; and

(h)

any reference to “writing” or “written”
includes any method of reproducing words or text in a legible and non-transitory
form but, for the avoidance of doubt, shall not include e-mail.

1.5

Headings

2.

THE TRANSACTION AND RELATED RESTRUCTURING ARRANGEMENTS

2.1

The parties hereby agree that, as at Completion and subject to fulfilment of
the Conditions:

(a)

BBY Inc will acquire the entire beneficial and economic ownership of CPWM
Ltd, which BBY Inc will immediately after Completion, hold in accordance with
the corporate structure set forth in schedule 1;

(b)

New CPWM will hold only BBE Group’s existing interest, right and title in and
to the BBYM Business; and

(c)

CPW Plc shall receive the Payment by way of a dividend declared and paid by
New CPWM.

2.2

The parties further agree that, as a result of and immediately following
Completion, neither CPW Plc nor BBE Ltd will hold any beneficial or economic
interest in the BBYM Business, but BBE Ltd will continue to operate its
remaining business activities in accordance with the terms of the New
Shareholders Agreement. The parties agree that there will be no change in the
ultimate ownership and control of BBE Ltd existing as at the date of this
Agreement as a result of the Transaction, save that the parties will hold their
interest in BBE Ltd through New BBEDL. The parties will each hold 50 per cent.
of the legal and beneficial interest in New

2.3

The parties will effect and achieve the transactions contemplated by clauses
2.1 and 2.2 above through implementation of the Restructuring in accordance with
the Steps Plan. The parties acknowledge and agree that they shall not be bound
to proceed with steps 6, 7 or 8 of the Restructuring (as set forth in the Steps
Plan) unless and until Conditions A and B are fulfilled and they shall not be
bound to complete step 8 of the Restructuring unless and until Condition C is
fulfilled.

3.

SHAREHOLDERS AGREEMENT

3.1

The parties acknowledge that:

(a)

in the course of the Restructuring, the parties will each acquire a 50 per
cent. legal and beneficial ownership interest in each of New BBEDL and New CPWM;

(b)

the New Shareholders Agreement will only be entered into between the parties
at Completion; and

(c)

the acquisition of the entire beneficial and economic interest in New CPWM by
BBY Inc will occur on Completion.

3.2

Notwithstanding the matters set out in clause 3.1 above and the various
transactions to be implemented pursuant to the Restructuring, each party hereby
agrees and undertakes, for the period from the date of this Agreement until
Completion, that it shall (and, to the extent that it is lawfully able to do so,
shall procure that its Affiliates, directors and officers shall) continue to
conduct and operate the business of the BBE Group (which shall include for these
purposes CPWM Ltd, New BBEDL and New CPWM) to the extent reasonably possible and
practicable in accordance with the terms of the Shareholders Agreement
including, but not limited to, in respect of governance, shareholder reserved
matters, shareholder restrictions and finance matters, provided that this clause
3.2 shall not prohibit implementation of the transactions required pursuant to
the Restructuring. The parties acknowledge and agree that this clause 3.2 shall
have effect notwithstanding that the Shareholders Agreement may terminate in
accordance with its terms prior to Completion.

3.3

To the extent of any inconsistency between the provisions of this clause 3
and the Shareholders Agreement and the articles of association of either of New
BBEDL and New CPWM, the provisions of this clause 3 and the Shareholders
Agreement shall, as between the parties hereto, prevail.

4.

IMPLEMENTATION OF THE TRANSACTION

5.

CONFIDENTIAL INFORMATION

5.1

Each party undertakes to the other parties that all Confidential Information
received from another party shall be kept confidential and that it shall not
directly or indirectly use,

5.2

The restrictions in clause 5.1 above shall not apply to communications,
information and/or material which fall within the definition of Confidential
Information:

(a)

to the extent it comes into the public domain otherwise than through a breach
of this clause 5 or any other confidentiality undertaking agreed between the
Parties in other documents; or

(b)

which can be shown by the recipient, to the reasonable satisfaction of the
discloser of such Confidential Information, to have been known to the recipient
prior to the recipient receiving the Confidential Information; or

(c)

the disclosure of which has been expressly authorised in writing by the party
to whom the Confidential Information belongs; or

(d)

which is required to be disclosed under any Regulatory Requirement or to
comply with any request or determination of any Tax Authority; or

(e)

which is required to be disclosed by a party in order to exercise its rights
or perform its obligations under this Agreement or otherwise carry out the
matters contemplated to be performed under this Agreement; or

5.3

Each party shall take all reasonable steps to minimise the risk of
unauthorised disclosure of Confidential Information by ensuring that only such
of its employees, professional advisers, auditors and consultants whose duties
will require them to possess any Confidential Information shall have access
thereto, and that they shall be instructed to treat the same as confidential
during and after the term of their employment or appointment by the relevant
party, as the case may be.

5.4

The obligations contained in this clause 5 shall continue after the
termination of this Agreement.

6.

ASSIGNMENT

7.

COSTS

8.

SEVERABILITY

9.

VARIATION, WAIVER AND CONSENT

9.1

Variation/waiver to be in writing

9.2

Variation/waiver shall not affect other rights

9.3

Consent to be in writing

10.

RIGHTS AND REMEDIES CUMULATIVE

10.1

Enforcement of rights

10.2

Remedies cumulative

11.

CONFLICT

12.

FURTHER ASSURANCE

13.

CONTRACTS (RIGHTS OF THIRD PARTIES) ACT 1999

14.

NOTICES

14.1

Save as otherwise provided in this Agreement, any notice, demand or other
communication (“Notice“) to be given by any party under, or in
connection with, this Agreement shall be in writing and signed by or on behalf
of the party giving it. Any Notice shall be served by delivering it by hand to
the address set out in clause 14.2 marked for the attention of the relevant
party set out in clause 14.2 (or as otherwise notified from time to time in
accordance with the provisions of this clause 14). Any Notice so served by hand
shall be deemed to have been duly given or made when delivered, provided that
where delivery by hand occurs after 6.00 p.m. on a Business Day or on a day
which is not a Business Day, service shall be deemed to occur at 9.00 a.m. on
the following Business Day.

14.2

The addresses of the parties for the purpose of clause 14.1 are as follows:

BBY Inc.

Address:

7601 Penn Avenue South, Richfield MN 55423

United States of America

Attention:

Todd G. Hartman

CPW Plc

Address:

1 Portal Way, London, W3 6RS, England

Attention:

Tim Morris

14.3

A party may notify all other parties to this Agreement of a change to its
name, relevant addressee or address for the purposes of this clause 14, provided
that such notice shall only be effective on:

(a)

the date specified in the notification as the date on which the change is to
take place; or

(b)

if no date is specified or the date specified is less than five Business Days
after the date on which notice is given, the date following five Business Days
after notice of any change has been given.

14.4

In proving service it shall be sufficient to prove that the envelope
containing such notice was properly addressed and delivered to the address shown
thereon.

15.

COUNTERPARTS

16.

GOVERNING LAW

17.

JURISDICTION

/s/ TODD G. HARTMAN

/s/ NIGEL LANGSTAFF