{"id":43095,"date":"2015-09-17T11:25:58","date_gmt":"2015-09-17T16:25:58","guid":{"rendered":"https:\/\/content.findlaw-admin.com\/ability-legal\/contracts\/uncategorized\/agreement-and-plan-of-merger-nabisco-holdings-corp-and-philip.html"},"modified":"2015-09-17T11:25:58","modified_gmt":"2015-09-17T16:25:58","slug":"agreement-and-plan-of-merger-nabisco-holdings-corp-and-philip","status":"publish","type":"corporate_contracts","link":"https:\/\/corporate.findlaw.com\/contracts\/planning\/agreement-and-plan-of-merger-nabisco-holdings-corp-and-philip.html","title":{"rendered":"Agreement and Plan of Merger &#8211; Nabisco Holdings Corp. and Philip Morris Cos. Inc."},"content":{"rendered":"<pre>                          AGREEMENT AND PLAN OF MERGER\n\n                                   dated as of\n\n                                  June 25, 2000\n\n                                      among\n\n                             NABISCO HOLDINGS CORP.,\n\n                          PHILIP MORRIS COMPANIES INC.,\n\n                                       and\n\n                            STRIKE ACQUISITION CORP.\n\n\n                                TABLE OF CONTENTS\n\n                                                                            PAGE\n                                                                            ----\n                                    ARTICLE 1\n                                   DEFINITIONS\n\n      SECTION 1.01. DEFINITIONS................................................1\n\n                                    ARTICLE 2\n                                   THE MERGER\n\n      SECTION 2.01. THE MERGER.................................................5\n      SECTION 2.02. CONVERSION OF SHARES.......................................6\n      SECTION 2.03. SURRENDER AND PAYMENT......................................6\n      SECTION 2.04. DISSENTING SHARES..........................................7\n      SECTION 2.05. STOCK OPTIONS..............................................8\n      SECTION 2.06. ADJUSTMENTS................................................8\n      SECTION 2.07. WITHHOLDING RIGHTS.........................................8\n      SECTION 2.08. LOST CERTIFICATES..........................................9\n\n                                   ARTICLE 3\n                            THE SURVIVING CORPORATION\n\n      SECTION 3.01. CERTIFICATE OF INCORPORATION...............................9\n      SECTION 3.02. BYLAWS.....................................................9\n      SECTION 3.03. DIRECTORS AND OFFICERS.....................................9\n\n                                   ARTICLE 4\n                  REPRESENTATIONS AND WARRANTIES OF THE COMPANY\n\n      SECTION 4.01. CORPORATE EXISTENCE AND POWER..............................9\n      SECTION 4.02. CORPORATE AUTHORIZATION...................................10\n      SECTION 4.03. GOVERNMENTAL AUTHORIZATION................................10\n      SECTION 4.04. NON-CONTRAVENTION.........................................10\n      SECTION 4.05. CAPITALIZATION............................................11\n      SECTION 4.06. SUBSIDIARIES..............................................11\n      SECTION 4.07. SEC FILINGS...............................................12\n      SECTION 4.08. FINANCIAL STATEMENTS......................................13\n      SECTION 4.09. DISCLOSURE DOCUMENTS......................................13\n      SECTION 4.10. ABSENCE OF CERTAIN CHANGES................................13\n      SECTION 4.11. NO UNDISCLOSED LIABILITIES................................15\n      SECTION 4.12. COMPLIANCE WITH LAWS AND COURT ORDERS.....................15\n      SECTION 4.13. LITIGATION................................................16\n      SECTION 4.14. FINDERS' FEES.............................................16\n      SECTION 4.15. OPINION OF FINANCIAL ADVISORS.............................16\n      SECTION 4.16. TAXES.....................................................16\n      SECTION 4.17. EMPLOYEE BENEFIT PLANS....................................17\n      SECTION 4.18. ENVIRONMENTAL MATTERS.....................................20\n      SECTION 4.19. INTELLECTUAL PROPERTY.....................................21\n      SECTION 4.20. ANTITAKEOVER STATUTE......................................21\n      SECTION 4.21. REAL PROPERTY.............................................21\n      SECTION 4.22. CONTRACTS; JOINT VENTURES.................................21\n      SECTION 4.23. INDEBTEDNESS..............................................22\n\n\n                                       i\n\n\n                                   ARTICLE 5\n                    REPRESENTATIONS AND WARRANTIES OF PARENT\n\n      SECTION 5.01. CORPORATE EXISTENCE AND POWER.............................22\n      SECTION 5.02. CORPORATE AUTHORIZATION...................................23\n      SECTION 5.03. GOVERNMENTAL AUTHORIZATION................................23\n      SECTION 5.04. NON-CONTRAVENTION.........................................23\n      SECTION 5.05. DISCLOSURE DOCUMENTS......................................23\n      SECTION 5.06. FINDERS' FEES.............................................24\n      SECTION 5.07. FINANCING.................................................24\n\n                                   ARTICLE 6\n                            COVENANTS OF THE COMPANY\n\n      SECTION 6.01. CONDUCT OF THE COMPANY....................................24\n      SECTION 6.02. STOCKHOLDER ACTION BY WRITTEN CONSENT; INFORMATION \n                    MATERIAL..................................................27\n      SECTION 6.03. ACCESS TO INFORMATION.....................................28\n      SECTION 6.04. NO SOLICITATION; OTHER OFFERS.............................28\n      SECTION 6.05. THIRD PARTY STANDSTILL AGREEMENTS.........................29\n\n                                   ARTICLE 7\n                               COVENANTS OF PARENT\n\n      SECTION 7.01. CONFIDENTIALITY...........................................30\n      SECTION 7.02. OBLIGATIONS OF MERGER SUBSIDIARY..........................30\n      SECTION 7.03. DIRECTOR AND OFFICER LIABILITY............................30\n      SECTION 7.04. EMPLOYEE MATTERS..........................................31\n\n                                   ARTICLE 8\n                       COVENANTS OF PARENT AND THE COMPANY\n\n      SECTION 8.01. REASONABLE BEST EFFORTS...................................33\n      SECTION 8.02. CERTAIN FILINGS...........................................33\n      SECTION 8.03. PUBLIC ANNOUNCEMENTS......................................33\n      SECTION 8.04. FURTHER ASSURANCES........................................33\n      SECTION 8.05. NOTICES OF CERTAIN EVENTS.................................34\n\n                                   ARTICLE 9\n                            CONDITIONS TO THE MERGER\n\n      SECTION 9.01. CONDITIONS TO OBLIGATIONS OF EACH PARTY...................34\n      SECTION 9.02. CONDITIONS TO THE OBLIGATIONS OF PARENT AND MERGER \n                    SUBSIDIARY................................................35\n      SECTION 9.03. CONDITIONS TO THE OBLIGATIONS OF THE COMPANY..............35\n\n                                   ARTICLE 10\n                                   TERMINATION\n\n      SECTION 10.01. TERMINATION..............................................36\n      SECTION 10.02. EFFECT OF TERMINATION....................................38\n\n                                   ARTICLE 11\n                                  MISCELLANEOUS\n\n      SECTION 11.01. NOTICES..................................................38\n      SECTION 11.02. NON-SURVIVAL OF REPRESENTATIONS AND WARRANTIES...........39\n      SECTION 11.03. AMENDMENTS; NO WAIVERS...................................40\n      SECTION 11.04. EXPENSES.................................................40\n      SECTION 11.05. SUCCESSORS AND ASSIGNS...................................41\n      SECTION 11.06. GOVERNING LAW............................................41\n      SECTION 11.07. JURISDICTION.............................................41\n      SECTION 11.08. WAIVER OF JURY TRIAL.....................................42\n      SECTION 11.09. COUNTERPARTS; EFFECTIVENESS; BENEFIT.....................42\n      SECTION 11.10. ENTIRE AGREEMENT.........................................42\n      SECTION 11.11. CAPTIONS.................................................42\n      SECTION 11.12. SEVERABILITY.............................................42\n      SECTION 11.13. SPECIFIC PERFORMANCE.....................................42\n\n\n                                       ii\n\n\n                          AGREEMENT AND PLAN OF MERGER\n\n      AGREEMENT AND PLAN OF MERGER dated as of June 25, 2000, among Nabisco\nHoldings Corp., a Delaware corporation (the \"Company\"), Philip Morris Companies\nInc., a Virginia corporation (\"Parent\"), and Strike Acquisition Corp., a\nDelaware corporation and a wholly-owned subsidiary of Parent (\"Merger\nSubsidiary\").\n\n      WHEREAS, the respective Boards of Directors of Parent, Merger Subsidiary\nand the Company have approved this Agreement, and deem it advisable and in the\nbest interests of their respective stockholders to consummate the merger of\nMerger Subsidiary with and into the Company on the terms and conditions set\nforth herein; and\n\n      WHEREAS, as a condition and inducement to Parent entering this Agreement,\nconcurrently with the execution and delivery of this Agreement, Parent and\nNabisco Group Holdings Corp., a Delaware corporation (\"NGH\"), a significant\nstockholder of the Company, are entering into a voting and indemnity agreement\n(the \"NGH Voting Agreement\") pursuant to which, among other things, NGH has\nagreed to vote its Shares in favor of the above-described merger, subject to\napproval by NGH's stockholders.\n\n      NOW, THEREFORE, the parties hereto agree as follows:\n\n\n                                    ARTICLE 1\n                                   DEFINITIONS\n\n\n      SECTION 1.01. Definitions. (a) The following terms, as used herein, have\nthe following meanings:\n\n      \"Affiliate\" means, with respect to any Person, any other Person directly\nor indirectly controlling, controlled by or under common control with such\nPerson.\n\n      \"Benefit Arrangement\" means any employment, severance or similar contract,\nplan, policy, fund or arrangement (whether or not written) providing for\ncompensation, bonus, profit-sharing, stock option, or other stock-related rights\nor other forms of incentive or deferred compensation, perquisites, vacation\nbenefits, insurance coverage (including any self-insured arrangements), health\nor medical benefits, disability benefits, worker's compensation, supplemental\nunemployment benefits, severance benefits and post-employment or retirement\nbenefits (including compensation, pension, health, medical or life insurance or\nother benefits) that (i) is not an Employee Plan, (ii) is entered into,\nmaintained, administered or contributed to, \n\n\n                                       1\n\n\nas the case may be, by the Company or any of its Affiliates and (iii) covers any\nemployee or former employee of the Company or any of its Subsidiaries employed\nin the United States.\n\n      \"Business Day\" means a day other than Saturday, Sunday or other day on\nwhich commercial banks in New York, New York are authorized or required by law\nto close.\n\n      \"Class A Shares\" means the shares of Class A common stock, $0.01 par\nvalue, of the Company.\n\n      \"Class B Shares\" means the shares of Class B common stock, $0.01 par\nvalue, of the Company.\n\n      \"Code\" means the Internal Revenue Code of 1986.\n\n      \"Company Balance Sheet\" means the consolidated balance sheet of the\nCompany as of December 31, 1999 and the footnotes thereto set forth in the\nCompany 10-K.\n\n      \"Company Intellectual Property Rights\" means all material Intellectual\nProperty Rights owned or licensed and used or held for use by the Company or any\nof its Subsidiaries.\n\n      \"Company 10-K\" means the Company's annual report on Form 10-K for the\nfiscal year ended December 31, 1999.\n\n      \"Controlled Group Liability\" means any and all liabilities (i) under Title\nIV of ERISA, (ii) under Section 302 of ERISA, (iii) under Sections 412 and 4971\nof the Code, (iv) as a result of a failure to comply with the continuation\ncoverage requirements of Section 601 et seq. of ERISA and Section 4980B of the\nCode and (v) under corresponding or similar provisions of foreign laws or\nregulations, other than such liabilities that arise solely out of, or relate\nsolely to, the Employee Plans, Benefit Arrangements and International Plans\nlisted in the Company Disclosure Schedule.\n\n      \"Delaware Law\" means the General Corporation Law of the State of Delaware.\n\n      \"Employee Arrangement\" means any Benefit Arrangement, Employee Plan or\nInternational Plan.\n\n      \"Employee Plan\" means any \"employee benefit plan\", as defined in Section\n3(3) of ERISA, that (i) is subject to any provision of ERISA, (ii) is\nmaintained, administered or contributed to by the Company or any of its\nAffiliates and (iii) covers any employee or former employee of the Company or\nany of its Subsidiaries.\n\n      \"Environmental Laws\" means any federal, state, local or foreign law,\nregulation, rule, order or decree, in each case as in effect on the date hereof,\nthat has as its principal purpose the protection of the environment or the\neffect of the environment on human health and safety.\n\n      \"Environmental Permits\" means all permits, licenses, certificates or\napprovals \n\n\n                                       2\n\n\nnecessary for the operation of the Company or any of its Subsidiaries as\ncurrently conducted to comply with all applicable Environmental Laws.\n\n      \"ERISA\" means the Employee Retirement Income Security Act of 1974.\n\n      \"ERISA Affiliate\" of any entity means any other entity that, together with\nsuch entity, would be treated as a single employer under Section 414 of the Code\nor Section 4001(b)(1) or 4001(a)(14) of ERISA.\n\n      \"Governmental Entity\" means any federal, state, local or foreign\ngovernment or any court, tribunal, administrative agency or commission or other\ngovernmental or other regulatory authority or agency, domestic, foreign or\nsupranational.\n\n      \"HSR Act\" means the Hart-Scott-Rodino Antitrust Improvements Act of 1976.\n\n      \"Intellectual Property Right\" means any trademark, service mark, trade\nname, mask work, invention, patent, trade secret, copyright, know-how or\nproprietary information contained on any website, processes, formulae, products,\ntechnologies, discoveries, apparatus, Internet domain names, trade dress and\ngeneral intangibles of like nature (together with goodwill), customer lists,\nconfidential information, licenses, software, databases and compilations\nincluding any and all collections of data and all documentation thereof\n(including any registrations or applications for registration of any of the\nforegoing) or any other similar type of proprietary intellectual property right.\n\n      \"International Plan\" means any employment, severance or similar contract\nor arrangement (whether or not written) or any plan, policy, fund, program or\narrangement or contract providing for compensatory severance, insurance coverage\n(including any self-insured arrangements), workers' compensation, disability\nbenefits, supplemental unemployment benefits, vacation benefits, pension or\nretirement benefits or for deferred compensation, profit-sharing, bonuses, stock\noptions, stock appreciation rights or other forms of incentive compensation or\npost-retirement insurance, compensation or benefits that (i) is not an Employee\nPlan or a Benefit Arrangement, (ii) is entered into, maintained, administered or\ncontributed to by the Company or any of its Affiliates and (iii) covers any\nemployee or former employee of the Company or any of its Subsidiaries.\n\n      \"Lien\" means, with respect to any property or asset, any mortgage, lien,\npledge, charge, security interest, encumbrance or other adverse claim of any\nkind in respect of such property or asset. For purposes of this Agreement, a\nPerson shall be deemed to own subject to a Lien, any property or asset that it\nhas acquired or holds subject to the interest of a vendor or lessor under any\nconditional sale agreement, capital lease or other title retention agreement\nrelating to such property or asset.\n\n      \"Material Adverse Effect\" means, with respect to any Person, a material\nadverse effect on the condition (financial or otherwise), business, assets or\nresults of operations of such Person and its Subsidiaries, taken as a whole\nexcept any such effect resulting from or arising in \n\n\n                                       3\n\n\nconnection with: (i) changes in circumstances or conditions affecting food\ncompanies in general, (ii) changes in general economic or business conditions or\nin financial markets in the United States or (iii) this Agreement or the\ntransactions contemplated hereby or the announcement hereof.\n\n      \"Multiemployer Plan\" means a multiemployer plan, as defined in Section\n3(37) of ERISA.\n\n      \"1933 Act\" means the Securities Act of 1933.\n\n      \"1934 Act\" means the Securities Exchange Act of 1934.\n\n      \"PBGC\" means the Pension Benefit Guaranty Corporation.\n\n      \"Person\" means an individual, corporation, partnership, limited liability\ncompany, association, trust or other entity or organization, including a\ngovernment or political subdivision or an agency or instrumentality thereof.\n\n      \"SEC\" means the Securities and Exchange Commission.\n\n      \"Shares\" means the Class A Shares and the Class B Shares.\n\n      \"Significant Joint Ventures\" means, together with their Subsidiaries, (i)\nBladeland Limited, (ii) Nabisco South Africa (Proprietary) Limited, (iii) PT\nNabisco Foods, (iv) Beijing Yili Food Company, (v) Beijing Nabisco Food Company\nand (vi) any comparable joint venture or partnership of the Company or any of\nits Subsidiaries.\n\n      \"Subsidiary\" means, with respect to any Person, any entity of which\nsecurities or other ownership interests having ordinary voting power to elect a\nmajority of the board of directors or other persons performing similar functions\nare at any time directly or indirectly owned by such Person.\n\n      \"Tax Sharing Agreement\" means the Tax Sharing Agreement dated as of June\n14, 1999 among NGH, R.J. Reynolds Tobacco Holdings, Inc., R. J. Reynolds Tobacco\nCompany and the Company, as such agreement may be amended from time to time.\n\n      \"Title IV Plan\" means a plan subject to Title IV of ERISA other than any\nMultiemployer Plan.\n\n      \"Withdrawal Liability\" means liability to or with respect to a\nMultiemployer Plan as a result of a complete or partial withdrawal from such\nMultiemployer Plan, as those terms are defined in Part I of Subtitle E of Title\nIV of ERISA.\n\n      Any reference in this Agreement to a statute shall be to such statute, as\namended from time to time, and to the rules and regulations promulgated\nthereunder.\n\n\n                                       4\n\n\n      (b) Each of the following terms is defined in the Section set forth\nopposite such term:\n\n      Term                                               Section\n      ----                                               -------\n      Acquisition Proposal.........................       6.04\n      Agents.......................................       6.04\n      Certificates.................................       2.03\n      Change in Tax Law............................       10.01\n      Company Disclosure Schedule..................     Article 4\n      Company Employees............................       7.04\n      Company Information Statement................       4.09\n      Company Properties...........................       4.21\n      Company SEC Documents........................       4.07\n      Company Securities...........................       4.05\n      Company Subsidiary Securities................       4.06\n      Confidentiality Agreement....................       6.03\n      Contracts....................................       4.22\n      Effective Time...............................       2.01\n      Exchange Agent...............................       2.03\n      Filed Contracts..............................       4.22\n      Financing Agreements.........................       5.07\n      GAAP.........................................       4.08\n      Indemnified Person...........................       7.03\n      IRS..........................................       4.16\n      JV Agreements................................       4.22\n      Merger.......................................       2.01\n      Merger Consideration.........................       2.02\n      NGH..........................................     recitals\n      NGH Stockholder Meeting......................       10.01\n      NGH Voting Agreement.........................     recitals\n      Preferred Shares.............................       4.05\n      RJR..........................................       10.01\n      Superior Proposal............................       6.04\n      Surviving Corporation........................       2.01\n      Tax Return...................................       4.16\n      Taxes........................................       4.16\n      Taxing Authority.............................       4.16\n\n\n                                       5\n\n\n                                    ARTICLE 2\n                                   THE MERGER\n\n\n      SECTION 2.01. The Merger. (a) At the Effective Time, Merger Subsidiary\nshall be merged (the \"Merger\") with and into the Company in accordance with\nDelaware Law, whereupon the separate existence of Merger Subsidiary shall cease,\nand the Company shall be the surviving corporation (the \"Surviving\nCorporation\").\n\n      (b) As soon as practicable after satisfaction or, to the extent permitted\nhereunder, waiver of all conditions to the Merger, the Company and Merger\nSubsidiary will file a certificate of merger with the Delaware Secretary of\nState and make all other filings or recordings required by Delaware Law in\nconnection with the Merger. The Merger shall become effective at such time (the\n\"Effective Time\") as the certificate of merger is duly filed with the Delaware\nSecretary of State or at such later time as is specified in the certificate of\nmerger.\n\n      (c) From and after the Effective Time, the Surviving Corporation shall\npossess all the rights, powers, privileges and franchises and be subject to all\nof the obligations, liabilities, restrictions and disabilities of the Company\nand Merger Subsidiary, all as provided under Delaware Law.\n\n      SECTION 2.02. Conversion of Shares. At the Effective Time:\n\n      (a) except as otherwise provided in Section 2.02(b) or Section 2.04, each\nShare outstanding immediately prior to the Effective Time shall be converted\ninto the right to receive $55.00 in cash, without interest (the \"Merger\nConsideration\");\n\n      (b) each Share held by the Company as treasury stock or owned by Parent or\nany of its Subsidiaries immediately prior to the Effective Time shall be\ncanceled, and no payment shall be made with respect thereto; and\n\n      (c) each share of common stock of Merger Subsidiary outstanding\nimmediately prior to the Effective Time shall be converted into and become one\nshare of common stock of the Surviving Corporation with the same rights, powers\nand privileges as the shares so converted and shall constitute the only\noutstanding shares of capital stock of the Surviving Corporation.\n\n      SECTION 2.03. Surrender and Payment. (a) Prior to the Effective Time,\nParent shall appoint an agent (the \"Exchange Agent\") reasonably acceptable to\nthe Company for the purpose of exchanging certificates representing Shares (the\n\"Certificates\") for the Merger Consideration. At the Effective Time, Parent will\ndeposit with the Exchange Agent the Merger Consideration to be paid in respect\nof the Shares. Promptly after the Effective Time, Parent will send, or will\ncause the Exchange Agent to send, to each holder of Shares at the Effective Time\na letter of transmittal and instructions (which shall specify that the delivery\nshall be effected, and risk of loss and title shall pass, only upon proper\ndelivery of the Certificates to the Exchange Agent) for use in such exchange.\n\n      (b) Each holder of Shares that have been converted into the right to\nreceive the Merger Consideration will be entitled to receive, upon surrender to\nthe Exchange Agent of a Certificate, \n\n\n                                       6\n\n\ntogether with a properly completed letter of transmittal, the Merger\nConsideration payable for each Share represented by such Certificate. Until so\nsurrendered, each such Certificate shall represent after the Effective Time for\nall purposes only the right to receive such Merger Consideration.\n\n      (c) If any portion of the Merger Consideration is to be paid to a Person\nother than the Person in whose name the surrendered Certificate is registered,\nit shall be a condition to such payment that the Certificate so surrendered\nshall be properly endorsed or otherwise be in proper form for transfer and that\nthe Person requesting such payment shall pay to the Exchange Agent any transfer\nor other taxes required as a result of such payment to a Person other than the\nregistered holder of such Certificate or establish to the satisfaction of the\nExchange Agent that such tax has been paid or is not payable.\n\n      (d) After the Effective Time, there shall be no further registration of\ntransfers of Shares. If, after the Effective Time, Certificates are presented to\nthe Surviving Corporation, they shall be canceled and exchanged for the Merger\nConsideration provided for, and in accordance with the procedures set forth, in\nthis Article 2.\n\n      (e) Any portion of the Merger Consideration made available to the Exchange\nAgent pursuant to Section 2.03(a) (and any interest or other income earned\nthereon) that remains unclaimed by the holders of Shares one year after the\nEffective Time shall be returned to Parent, upon demand, and any such holder who\nhas not exchanged Shares for the Merger Consideration in accordance with this\nSection 2.03 prior to that time shall thereafter look only to Parent for payment\nof the Merger Consideration in respect of such Shares without any interest\nthereon. Notwithstanding the foregoing, Parent shall not be liable to any holder\nof Shares for any amount paid to a public official pursuant to applicable\nabandoned property, escheat or similar laws. Any amounts remaining unclaimed by\nholders of Shares three years after the Effective Time (or such earlier date\nimmediately prior to such time when the amounts would otherwise escheat to or\nbecome property of any governmental authority) shall become, to the extent\npermitted by applicable law, the property of Parent free and clear of any claims\nor interest of any Person previously entitled thereto.\n\n      (f) Any portion of the Merger Consideration made available to the Exchange\nAgent pursuant to Section 2.03(a) to pay for Shares for which appraisal rights\nhave been perfected shall be returned to Parent, upon demand.\n\n      SECTION 2.04. Dissenting Shares. Notwithstanding Section 2.02, Shares\noutstanding immediately prior to the Effective Time and held by a holder who has\nnot voted in favor of the Merger or consented thereto in writing and who has\ndemanded appraisal for such Shares in accordance with Delaware Law shall not be\nconverted into a right to receive the Merger Consideration, unless such holder\nfails to perfect, withdraws or otherwise loses its right to appraisal. If, after\nthe Effective Time, such holder fails to perfect, withdraws or loses its right\nto appraisal, such Shares shall be treated as if they had been converted as of\nthe Effective Time into \n\n\n                                       7\n\n\na right to receive the Merger Consideration. The Company shall give Parent\nprompt notice of any demands received by the Company for appraisal of Shares.\nExcept as required by applicable law or with the prior written consent of\nParent, the Company shall not make any payment with respect to, or settle or\noffer to settle, any such demands.\n\n      SECTION 2.05. Stock Options. (a) At or immediately prior to the Effective\nTime, each employee or director stock option to purchase Shares outstanding\nunder any stock option or compensation plan or arrangement of the Company,\nwhether or not vested or exercisable, shall be canceled, and the Company shall\npay each holder of any such option at the time provided below for each such\noption an amount in cash determined by multiplying (i) the excess, if any, of\nthe Merger Consideration per Share over the applicable exercise price of such\noption by (ii) the number of Shares such holder could have purchased (assuming\nfull vesting of all options) had such holder exercised such option in full\nimmediately prior to the Effective Time. In the case of each such option that is\noutstanding on the date hereof, such payment shall be made before, at or\npromptly after the Effective Time. In all other cases, such payment shall be\nmade when and if such option is exercised (or vests, if converted into a right\nto receive cash) in accordance with its terms.\n\n      (b) Prior to the Effective Time, the Company shall (i) use its best\nefforts to obtain any consents from holders of options to purchase Shares\ngranted under the Company's stock option or compensation plans or arrangements\nand (ii) make any amendments to the terms of such stock option or compensation\nplans or arrangements that, in the case of either clauses (i) or (ii), are\nnecessary to give effect to the transactions contemplated by Section 2.05(a).\nNotwithstanding any other provision of this Section, payment may be withheld in\nrespect of any employee stock option until such necessary consents are obtained,\nand the Company shall withhold from such payments all amounts required by\napplicable law or regulation to be withheld for taxes or otherwise.\n\n      SECTION 2.06. Adjustments. If, during the period between the date of this\nAgreement and the Effective Time, any change in the outstanding Shares shall\noccur, including by reason of any reclassification, recapitalization, stock\nsplit or combination, exchange or readjustment of Shares, or stock dividend\nthereon with a record date during such period, the Merger Consideration and any\nother amounts payable pursuant to this Agreement shall be appropriately\nadjusted.\n\n      SECTION 2.07. Withholding Rights. Each of the Surviving Corporation and\nParent shall be entitled to deduct and withhold from the consideration otherwise\npayable to any Person pursuant to this Article 2 such amounts as it is required\nto deduct and withhold with respect to the making of such payment under any\nprovision of federal, state, local or foreign tax law. If the Surviving\nCorporation or Parent, as the case may be, so withholds amounts, such amounts\nshall be treated for all purposes of this Agreement as having been paid to the\nholder of the Shares in respect of which the Surviving Corporation or Parent, as\nthe case may be, made such deduction and withholding.\n\n      SECTION 2.08. Lost Certificates. If any Certificate shall have been lost,\nstolen or \n\n\n                                       8\n\n\ndestroyed, upon the making of an affidavit of that fact by the Person claiming\nsuch Certificate to be lost, stolen or destroyed and, if required by the\nSurviving Corporation, the posting by such Person of a bond, in such reasonable\namount as the Surviving Corporation may direct, as indemnity against any claim\nthat may be made against it with respect to such Certificate, the Exchange Agent\nwill pay, in exchange for such lost, stolen or destroyed Certificate, the Merger\nConsideration to be paid in respect of the Shares represented by such\nCertificate, as contemplated by this Article.\n\n                                    ARTICLE 3\n                            THE SURVIVING CORPORATION\n\n      SECTION 3.01. Certificate of Incorporation. The certificate of\nincorporation of the Company in effect at the Effective Time shall be the\ncertificate of incorporation of the Surviving Corporation until amended in\naccordance with applicable law.\n\n      SECTION 3.02. Bylaws. The bylaws of Merger Subsidiary in effect at the\nEffective Time shall be the bylaws of the Surviving Corporation until amended in\naccordance with applicable law.\n\n      SECTION 3.03. Directors and Officers. From and after the Effective Time,\nuntil successors are duly elected or appointed and qualified in accordance with\napplicable law, (i) the directors of Merger Subsidiary at the Effective Time\nshall be the directors of the Surviving Corporation and (ii) the officers of the\nCompany at the Effective Time shall be the officers of the Surviving\nCorporation.\n\n                                    ARTICLE 4\n                  REPRESENTATIONS AND WARRANTIES OF THE COMPANY\n\n      Except as set forth in the corresponding sections or subsections of the\ndisclosure schedule delivered by the Company to Parent on or prior to the date\nhereof (the \"Company Disclosure Schedule\") or in the Company SEC Documents, the\nCompany represents and warrants to Parent that:\n\n      SECTION 4.01. Corporate Existence and Power. The Company is a corporation\nduly incorporated, validly existing and in good standing under the laws of the\nState of Delaware and has all corporate powers and all governmental licenses,\nauthorizations, permits, consents and approvals required to carry on its\nbusiness as now conducted, except for those licenses, authorizations, permits,\nconsents and approvals the absence of which would not reasonably be expected to\nhave, individually or in the aggregate, a Material Adverse Effect on the\nCompany. The Company is duly qualified to do business as a foreign corporation\nand is in good standing in \n\n\n                                       9\n\n\neach jurisdiction where such qualification is necessary, except for those\njurisdictions where failure to be so qualified would not reasonably be expected\nto have, individually or in the aggregate, a Material Adverse Effect on the\nCompany. The Company has heretofore made available to Parent true and complete\ncopies of the certificate of incorporation and bylaws of the Company as\ncurrently in effect.\n\n      SECTION 4.02. Corporate Authorization. (a) The execution, delivery and\nperformance by the Company of this Agreement and the consummation by the Company\nof the transactions contemplated hereby are within the Company's corporate\npowers and, except for the affirmative vote of the holders of a majority of the\noutstanding Shares in connection with the consummation of the Merger, have been\nduly authorized by all necessary corporate action on the part of the Company.\nThe affirmative vote of the holders of a majority of the outstanding Shares is\nthe only vote of the holders of any of the Company's capital stock necessary in\nconnection with the consummation of the Merger. This Agreement has been duly\nexecuted and delivered by the Company and constitutes a valid and binding\nagreement of the Company.\n\n      (b) At a meeting duly called and held, the Company's Board of Directors\nhas (i) determined that this Agreement and the transactions contemplated hereby\nare fair to and in the best interests of the Company's stockholders, (ii)\ndeclared advisable, approved and adopted this Agreement and the transactions\ncontemplated hereby and (iii) resolved (subject to Section 6.04(c)) to recommend\napproval and adoption of this Agreement and the Merger by its stockholders.\n\n      SECTION 4.03. Governmental Authorization. The execution, delivery and\nperformance by the Company of this Agreement and the consummation by the Company\nof the transactions contemplated hereby require no action by or in respect of,\nor filing with, any Governmental Entity, other than (i) the filing of a\ncertificate of merger with respect to the Merger with the Delaware Secretary of\nState and appropriate documents with the relevant authorities of other states in\nwhich the Company is qualified to do business, (ii) compliance with any\napplicable requirements of the HSR Act and of laws, rules and regulations in\nforeign jurisdictions governing antitrust or merger control matters, (iii)\ncompliance with any applicable requirements of the 1933 Act, the 1934 Act and\nany other applicable securities or takeover laws, whether state or foreign and\n(iv) any actions or filings the absence of which would not reasonably be\nexpected to have, individually or in the aggregate, a Material Adverse Effect on\nthe Company or materially to impair the ability of the Company to consummate the\ntransactions contemplated by this Agreement.\n\n      SECTION 4.04. Non-contravention. The execution, delivery and performance\nby the Company of this Agreement and the consummation of the transactions\ncontemplated hereby do not and will not (i) contravene, conflict with, or result\nin any violation or breach of any provision of the certificate of incorporation\nor bylaws of the Company or of the similar organizational documents of any of\nits material Subsidiaries, (ii) assuming compliance with the matters referred to\nin Section 4.03, contravene, conflict with, or result in a violation or breach\nof any provision of any applicable law, regulation, judgment, injunction, order\nor decree, (iii) require any consent or \n\n\n                                       10\n\n\nother action by any Person under, constitute (with or without notice or lapse of\ntime or both) a default under, or cause or permit the termination, cancellation,\nacceleration or other change of any right or obligation or the loss of any\nbenefit to which the Company or any of its Subsidiaries is entitled under any\nprovision of any agreement or other instrument binding upon the Company or any\nof its Subsidiaries (or their respective Company Properties) or any license,\nfranchise, permit, certificate, approval or other similar authorization\naffecting, or relating in any way to, the assets or business of the Company and\nits Subsidiaries or (iv) result in the creation or imposition of any Lien on any\nasset of the Company or any of its Subsidiaries, except, in the case of clauses\n(ii), (iii) and (iv), for such matters as would not reasonably be expected to\nhave, individually or in the aggregate, a Material Adverse Effect on the Company\nor prevent or materially delay the consummation of the Merger.\n\n      SECTION 4.05. Capitalization. (a) The authorized capital stock of the\nCompany consists of (i) 1 billion shares of common stock, $0.01 par value per\nshare, of which (x) 265,000,000 shares have been designated as Class A Shares,\n(y) 213,250,000 shares have been designated as Class B Shares and (z) the\nremaining 521,750,000 shares may be designated by the Board of Directors of the\nCompany as either Class A Shares or Class B Shares prior to issuance, and (ii)\n75,000,000 shares of preferred stock, par value $0.01 per share (the \"Preferred\nShares\"). As of June 22, 2000, there were outstanding: (1) 52,704,984 Class A\nShares (including equivalents payable in cash or Class A Shares); (2)\n213,250,000 Class B Shares; (3) employee and director stock options to purchase\nan aggregate of 20,913,569 Class A Shares; and (4) no Preferred Shares. All\nshares of capital stock of the Company outstanding as of the date hereof have\nbeen duly authorized and validly issued and are fully paid and nonassessable.\nAll Class A Shares issuable upon exercise of outstanding employee or director\nstock options have been duly authorized and, when issued in accordance with the\nterms thereof, will be validly issued and will be fully paid and nonassessable.\n\n      (b) Except as set forth in this Section 4.05 and for changes since June\n22, 2000 resulting from the exercise of employee or director stock options\noutstanding on such date, there are no outstanding (i) shares of capital stock\nor voting securities of the Company, (ii) securities of the Company convertible\ninto or exchangeable for shares of capital stock or voting securities of the\nCompany or (iii) options or other rights to acquire from the Company or other\nobligation of the Company to issue, any capital stock, voting securities or\nsecurities convertible into or exchangeable for capital stock or voting\nsecurities of the Company (the items in clauses (i), (ii) and (iii) being\nreferred to collectively as the \"Company Securities\"). There are no outstanding\nobligations of the Company or any of its Subsidiaries to repurchase, redeem or\notherwise acquire any of the Company Securities.\n\n      SECTION 4.06. Subsidiaries. (a) Each Subsidiary of the Company is a\ncorporation duly incorporated, validly existing and in good standing under the\nlaws of its jurisdiction of incorporation, has all powers and all governmental\nlicenses, authorizations, permits, consents and approvals required to carry on\nits business as now conducted, except for those licenses, authorizations,\npermits, consents and approvals the absence of which would not reasonably be\nexpected to have, individually or in the aggregate, a Material Adverse Effect on\nthe Company. \n\n\n                                       11\n\n\nEach such Subsidiary is duly qualified to do business as a foreign corporation\nand is in good standing in each jurisdiction where such qualification is\nnecessary, except for those jurisdictions where failure to be so qualified would\nnot reasonably be expected to have, individually or in the aggregate, a Material\nAdverse Effect on the Company. All material Subsidiaries of the Company and\ntheir respective jurisdictions of incorporation are identified in the Company\n10-K. Section 4.06 of the Company Disclosure Schedule identifies the Company's\ndirect and indirect percentage ownership of each Subsidiary.\n\n      (b) All of the outstanding capital stock of, or other voting securities or\nownership interests in, each Subsidiary of the Company, is owned by the Company,\ndirectly or indirectly, free and clear of any Lien and free of any other\nlimitation or restriction (including any restriction on the right to vote, sell\nor otherwise dispose of such capital stock or other voting securities or\nownership interests). There are no outstanding (i) securities of the Company or\nany of its Subsidiaries convertible into or exchangeable for shares of capital\nstock or other voting securities or ownership interests in any Subsidiary of the\nCompany or (ii) options or other rights to acquire from the Company or any of\nits Subsidiaries, or other obligation of the Company or any of its Subsidiaries\nto issue, any capital stock or other voting securities or ownership interests\nin, or any securities convertible into or exchangeable for any capital stock or\nother voting securities or ownership interests in, any Subsidiary of the Company\n(the items in clauses (i) and (ii) being referred to collectively as the\n\"Company Subsidiary Securities\"). There are no outstanding obligations of the\nCompany or any of its Subsidiaries (i) to repurchase, redeem or otherwise\nacquire any of the Company Subsidiary Securities, (ii) to register any Company\nSubsidiary Securities under the 1933 Act or any state securities law or (iii) to\ngrant preemptive or antidilutive rights with respect to any Company Subsidiary\nSecurities.\n\n      SECTION 4.07. SEC Filings. (a) The Company has made available to Parent\n(i) the Company's annual reports on Form 10-K for its fiscal years ended\nDecember 31, 1999 and 1998, (ii) its quarterly report on Form 10-Q for its\nfiscal quarter ended March 31, 2000, (iii) its proxy or information statements\nrelating to meetings of, or actions taken without a meeting by, the stockholders\nof the Company held since December 31, 1999 and (iv) all of its other reports,\nstatements, schedules and registration statements filed with the SEC since\nDecember 31, 1999 (the documents referred to in this Section 4.07(a),\ncollectively, the \"Company SEC Documents\").\n\n      (b) As of its filing date, each Company SEC Document complied as to form\nin all material respects with the applicable requirements of the 1933 Act and\nthe 1934 Act, as the case may be.\n\n      (c) As of its filing date (or, if amended or superceded by a filing prior\nto the date hereof, on the date of such filing), each Company SEC Document filed\npursuant to the 1934 Act did not contain any untrue statement of a material fact\nor omit to state any material fact necessary in order to make the statements\nmade therein, in the light of the circumstances under which they were made, not\nmisleading.\n\n\n                                       12\n\n\n      (d) Each Company SEC Document that is a registration statement, as amended\nor supplemented, if applicable, filed pursuant to the 1933 Act, as of the date\nsuch statement or amendment became effective, did not contain any untrue\nstatement of a material fact or omit to state any material fact required to be\nstated therein or necessary to make the statements therein not misleading.\n\n      (e) Other than Nabisco, Inc., no Subsidiary of the Company is subject to\nthe periodic reporting requirements of the 1934 Act.\n\n      SECTION 4.08. Financial Statements. The audited consolidated financial\nstatements and unaudited consolidated interim financial statements (including\nthe related notes) of the Company included in the Company SEC Documents fairly\npresent in all material respects, in conformity with United States generally\naccepted accounting principles (\"GAAP\") applied on a consistent basis (except as\nmay be indicated in the notes thereto), the consolidated financial position of\nthe Company and its consolidated Subsidiaries as of the dates thereof and their\nconsolidated results of operations and cash flows for the periods then ended\n(subject to normal year-end adjustments that are not expected to be material in\namount in the case of any unaudited interim financial statements).\n\n      SECTION 4.09. Disclosure Documents. The information statement of the\nCompany to be filed with the SEC in connection with the Merger (the \"Company\nInformation Statement\") and any amendments or supplements thereto will, when\nfiled, comply as to form in all material respects with the applicable\nrequirements of the 1934 Act. At the time the Company Information Statement or\nany amendment or supplement thereto is first mailed to stockholders of the\nCompany, the Company Information Statement, as supplemented or amended, if\napplicable, will not contain any untrue statement of a material fact or omit to\nstate any material fact necessary in order to make the statements made therein,\nin the light of the circumstances under which they were made, not misleading.\nThe representations and warranties contained in this Section 4.09 will not apply\nto statements or omissions included in the Company Information Statement based\nupon information furnished to the Company by Parent specifically for use\ntherein.\n\n      SECTION 4.10. Absence of Certain Changes. Since December 31, 1999, the\nbusiness of the Company and its Subsidiaries has been conducted in the ordinary\ncourse consistent with past practices and there has not been:\n\n      (a) any event, occurrence, development or state of circumstances or facts\nthat, either individually or in the aggregate, has had or is reasonably likely\nto have a Material Adverse Effect on the Company;\n\n      (b) any declaration, setting aside or payment of any dividend or other\ndistribution with respect to any shares of capital stock of the Company (other\nthan customary quarterly cash dividends on the Shares in an amount not greater\nthan $.188 per Share per quarter), or any repurchase, redemption or other\nacquisition by the Company or any of its Subsidiaries of any outstanding shares\nof capital stock or other securities of, or other ownership interests in, the\n\n\n                                       13\n\n\nCompany or any of its Subsidiaries;\n\n      (c) any amendment of any material term of any outstanding security of the\nCompany or any of its Subsidiaries;\n\n      (d) any incurrence, assumption or guarantee by the Company or any of its\nSubsidiaries of any indebtedness for borrowed money other than in the ordinary\ncourse of business and in amounts and on terms consistent with past practices;\n\n      (e) any creation or other incurrence by the Company or any of its\nSubsidiaries of any Lien on any material asset other than in the ordinary course\nof business consistent with past practices;\n\n      (f) any making of any loan, advance or capital contributions to or\ninvestment in any Person not wholly owned, directly or indirectly, by the\nCompany, other than immaterial amounts in the ordinary course of business\nconsistent with past practices;\n\n      (g) any damage, destruction or other casualty loss (whether or not covered\nby insurance) affecting the business or assets of the Company or any of its\nSubsidiaries that has had or would reasonably be expected to have a Material\nAdverse Effect on the Company;\n\n      (h) any transaction or commitment made, or any contract or agreement\nentered into, by the Company or any of its Subsidiaries relating to its assets\nor business (including the acquisition or disposition of any assets) or any\nrelinquishment by the Company or any of its Subsidiaries of any contract or\nother right, in either case, material to the Company and its Subsidiaries, taken\nas a whole, other than transactions and commitments in the ordinary course of\nbusiness consistent with past practices and those contemplated by this\nAgreement;\n\n      (i) any change in any method of accounting, method of tax accounting or\naccounting principles or practice by the Company or any of its Subsidiaries,\nincluding, without limitation, any amendment of the Tax Sharing Agreement,\nexcept for any such change which is not significant or which is required by\nreason of a concurrent change in GAAP;\n\n      (j) any (i) grant of any severance or termination pay to (or amendment to\nany existing arrangement with) any director, officer or (to the extent material\nin the aggregate) employee of the Company or any of its Subsidiaries, (ii)\nestablishment, adoption or amendment (except as required by applicable law) of\nany collective bargaining, bonus, profit-sharing, thrift, pension, retirement or\nother benefit plan or arrangement covering any director, officer or employee of\nthe Company or any of its Subsidiaries, (iii) other than as disclosed in Section\n4.10(j)(iii) of the Company Disclosure Schedule, increase in compensation, bonus\nor other benefits payable to any director or executive officer (or other officer\nwith an employment agreement) of the Company, or (iv) other than in the ordinary\ncourse of business consistent with past practice, increase in compensation,\nbonus or other benefits payable to any employee not described in clause (iii) of\n\n\n                                       14\n\n\nthe Company or any of its Subsidiaries;\n\n      (k) any material labor dispute, other than routine individual grievances,\nor any activity or proceeding by a labor union or representative thereof to\norganize any employees of the Company or any of its Subsidiaries, which\nemployees were not subject to a collective bargaining agreement at December 31,\n1999, or any material lockouts, strikes, slowdowns, work stoppages or threats\nthereof by or with respect to such employees;\n\n      (l) any settlement or waiver of a material litigation or claim; or\n\n      (m) any agreement to do any of the foregoing.\n\n      SECTION 4.11. No Undisclosed Liabilities. There are no liabilities or\nobligations of the Company or any of its Subsidiaries of any kind whatsoever,\nwhether accrued, contingent, absolute, determined, determinable or otherwise,\nother than:\n\n      (a) liabilities or obligations disclosed or provided for in the Company\nBalance Sheet or in the notes thereto or in the Company SEC Documents filed\nprior to the date hereof,\n\n      (b) liabilities or obligations incurred in the ordinary course of business\nthat would not reasonably be expected to have, individually or in the aggregate,\na Material Adverse Effect on the Company,\n\n      (c) immaterial liabilities or obligations not incurred in the ordinary\ncourse which, taken together, are not material to the Company and its\nSubsidiaries taken as a whole,\n\n      (d) liabilities or obligations under this Agreement, or\n\n      (e) liabilities or obligations incurred in connection with the\ntransactions contemplated hereby and disclosed in the Company Disclosure\nSchedule.\n\n      No representations or warranties with respect to environmental matters are\nbeing made in this Section 4.11.\n\n      SECTION 4.12. Compliance with Laws and Court Orders. Neither the Company\nnor any of its Subsidiaries nor any of their respective properties is in\nviolation of, or has since December 31, 1999 violated, any applicable law,\nstatute, ordinance, rule, regulation, judgment, injunction, order or decree,\nexcept for violations that have not had and would not reasonably be expected to\nhave, individually or in the aggregate, a Material Adverse Effect on the Company\nor prevent or materially delay the consummation of the Merger. The Company and\nits Subsidiaries are in compliance with the terms of all required governmental\nlicenses, authorizations, permits, consents and approvals, except where the\nfailure so to comply would not, individually or in the aggregate, reasonably be\nexpected to have a Material Adverse Effect on the Company.\n\n\n                                       15\n\n\n      SECTION 4.13. Litigation. There is no action, suit, investigation or\nproceeding pending, or, to the knowledge of the Company, threatened, against the\nCompany or any of its Subsidiaries, or any of their respective properties before\nany court or arbitrator or before or by any Governmental Entity, that, if\ndetermined or resolved adversely in accordance with the plaintiff's demands,\nwould reasonably be expected to have a Material Adverse Effect on the Company or\nprevent or materially delay the consummation of the Merger. Neither the Company\nnor any of its Subsidiaries is subject to any outstanding order, writ,\ninjunction or decree that, individually or in the aggregate, would reasonably be\nexpected to have a Material Adverse Effect on the Company or prevent or\nmaterially delay the consummation of the Merger.\n\n      SECTION 4.14. Finders' Fees. Except for UBS Warburg LLC, Morgan Stanley &amp; Co. Incorporated and Bear, Stearns &amp; Co. Inc., copies of whose engagement\nagreements have been provided to Parent, there is no investment banker, broker,\nfinder or other intermediary that has been retained by or is authorized to act\non behalf of the Company or any of its Subsidiaries who might be entitled to any\nfee or commission from the Company or any of its Affiliates in connection with\nthe transactions contemplated by this Agreement. The fees, commissions and\nexpenses of UBS Warburg, LLC, Morgan Stanley &amp; Co. Incorporated, Bear, Stearns &amp; Co. Inc., Davis Polk &amp; Wardwell, Deloitte &amp; Touche LLP and any other advisors\nretained by the Company or NGH in connection with the transactions contemplated\nby this Agreement to be paid by the Company will not exceed $50 million.\n\n      SECTION 4.15. Opinion of Financial Advisors. The Company has received an\nopinion of UBS Warburg LLC and an opinion of Morgan Stanley &amp; Co. Incorporated,\neach dated as of the date of this Agreement and each to the effect that, as of\nthe date of such opinion, the Merger Consideration is fair to the Company's\nstockholders from a financial point of view. Complete and correct signed copies\nof such opinions will be delivered to Parent as soon as practicable after the\ndate of this Agreement.\n\n      SECTION 4.16. Taxes. (a) The Company and each of its Subsidiaries has\ntimely filed (or has had timely filed on its behalf) or will file or cause to be\ntimely filed all material Tax Returns required by applicable law to be filed by\nit or on its behalf prior to or as of the Effective Time, and all such Tax\nReturns are, or will be at the time of filing, true and complete in all material\nrespects.\n\n      (b) The Company and each of its Subsidiaries has paid (or has had paid on\nits behalf), or, where payment is not yet due, has established (or has had\nestablished on its behalf and for its sole benefit and recourse) or (with\nrespect to new contingencies arising after the date hereof) will establish or\ncause to be established in accordance with GAAP on or before the Effective Time\nan adequate accrual for the payment of, all taxes due with respect to any period\nending prior to or as of the Effective Time.\n\n      (c) The federal income Tax Returns filed with respect to the Company and\nits Subsidiaries have been examined and settled with the Internal Revenue\nService (the \"IRS\") (or the applicable statutes of limitation for the assessment\nof federal income Taxes for such periods \n\n\n                                       16\n\n\nhave expired) for all years through 1994.\n\n      (d) There are no material Liens or encumbrances for Taxes on any of the\nassets of the Company or any of its Subsidiaries.\n\n      (e) The Company and its Subsidiaries have complied in all material\nrespects with all applicable laws, rules and regulations relating to the payment\nand withholding of Taxes.\n\n      (f) No federal, state, local or foreign audits or administrative\nproceedings are pending with regard to any material Taxes or Tax Return of the\nCompany or its Subsidiaries and none of them has received a written notice of\nany proposed audit or proceeding regarding any pending audit or proceeding.\n\n      (g) \"Taxes\" shall mean any and all taxes, charges, fees, levies or other\nassessments, including income, gross receipts, excise, real or personal\nproperty, sales, withholding, social security, retirement, unemployment,\noccupation, use, goods and services, service use, license, value added, capital,\nnet worth, payroll, profits, withholding, franchise, transfer and recording\ntaxes, fees and charges, and any other taxes, assessment or similar charges\nimposed by the IRS or any taxing authority (whether domestic or foreign\nincluding any state, county, local or foreign government or any subdivision or\ntaxing agency thereof (including a United States possession)) (a \"Taxing\nAuthority\"), whether computed on a separate, consolidated, unitary, combined or\nany other basis; and such term shall include any interest whether paid or\nreceived, fines, penalties or additional amounts attributable to, or imposed\nupon, or with respect to, any such taxes, charges, fees, levies or other\nassessments. \"Tax Return\" shall mean any report, return, document, declaration\nor other information or filing required to be supplied to any Taxing Authority\nor jurisdiction (foreign or domestic) with respect to Taxes, including\ninformation returns, any documents with respect to or accompanying payments of\nestimated Taxes, or with respect to or accompanying requests for the extension\nof time in which to file any such report, return, document, declaration or other\ninformation.\n\n      SECTION 4.17. Employee Benefit Plans. (a) The Company has made available\nto Parent copies of each material Employee Plan (and, if applicable, related\ntrust agreements) and all amendments thereto and written interpretations thereof\ntogether with the most recent annual report (Form 5500 including, if applicable,\nSchedule B thereto), summary plan description and any material modifications\nthereto, annual financial report and actuarial valuation report prepared in\nconnection with any such Employee Plan and all trust agreements, insurance\ncontracts and other funding vehicles relating thereto. The Company Disclosure\nSchedule identifies each such Employee Plan that is (i) a Multiemployer Plan,\n(ii) a Title IV Plan or (iii) maintained in connection with any trust described\nin Section 501(c)(9) of the Code.\n\n      (b) Each material Employee Plan that is intended to be qualified under\nSection 401(a) of the Code is so qualified and has been so qualified during the\nperiod since its adoption; each trust created under any such Plan is exempt from\ntax under Section 501(a) of the Code and has \n\n\n                                       17\n\n\nbeen so exempt since its creation. The Company has made available to Parent the\nmost recent determination letter of the Internal Revenue Service relating to\neach such Employee Plan. Each material Employee Plan has been maintained in\nsubstantial compliance with its terms and with the requirements prescribed by\nany and all applicable statutes, orders, rules and regulations, including ERISA\nand the Code.\n\n      (c) The Company has made available to Parent copies (or if there is no\nwritten plan document, any existing written descriptions) of each material\nBenefit Arrangement (and, if applicable, related trust agreements) and all\namendments thereto and written interpretations thereof. Each such Benefit\nArrangement has been maintained in substantial compliance with its terms and\nwith the requirements prescribed by any and all applicable statutes, orders,\nrules and regulations and has been maintained in good standing with applicable\nregulatory authorities.\n\n      (d) There has been no failure of a group health plan (as defined in\nSection 5000(b)(1) of the Code) to meet the requirements of Code Section\n4980B(f) with respect to a qualified beneficiary (as defined in Section\n4980B(g)). Neither the Company nor any of its Subsidiaries has contributed to a\nnonconforming group health plan (as defined in Section 5000(c)) and no ERISA\nAffiliate of the Company or any of its Subsidiaries has incurred a tax under\nSection 5000(a) that is or could become a liability of the Company or any of its\nSubsidiaries.\n\n      (e) The Company has made available to Parent copies of each material\nInternational Plan. Each such International Plan has been maintained in\nsubstantial compliance with its terms and with the requirements prescribed by\nany and all applicable statutes, orders, rules and regulations (including any\nspecial provisions relating to qualified plans where such Plan was intended so\nto qualify) and has been maintained in good standing with applicable regulatory\nauthorities. There has been no amendment to, written interpretation of or\nannouncement (whether or not written) by the Company or any of its Subsidiaries\nrelating to, or change in employee participation or coverage under, any material\nInternational Plan that would increase materially the expense of maintaining\nsuch International Plan above the level of expense incurred in respect thereof\nfor the most recent fiscal year ended prior to the date hereof. Each such\nInternational Plan that is intended to be funded and\/or book-reserved is fully\nfunded and\/or book-reserved, as appropriate, based upon reasonable actuarial\nassumptions.\n\n      (f) The Company Disclosure Schedule contains a complete list of all\nmaterial Employee Arrangements. Except as specifically provided in the foregoing\ndocuments made available to Parent, no amendments to any such Employee\nArrangement have been adopted or approved nor has the Company or any of its\nAffiliates undertaken to make any such amendments or to adopt or approve any new\nmaterial Employee Arrangement.\n\n      (g) All material contributions required to be made to any Employee\nArrangement or any trust or other arrangement funding any of the foregoing by\napplicable law or regulation or by any plan document or other contractual\nundertaking, and all material premiums due or payable with respect to insurance\npolicies funding any Employee Arrangement, for any period through \n\n\n                                       18\n\n\nthe date hereof have been timely made or paid in full.\n\n      (h) With respect to each Title IV Plan: (i) there does not exist any\naccumulated funding deficiency within the meaning of Code Section 412 or Section\n302 of ERISA, whether or not waived; (ii) no reportable event within the meaning\nof Section 4043(c) of ERISA for which the 30-day notice requirement has not been\nwaived has occurred, and the consummation of the transactions contemplated by\nthis Agreement will not result in the occurrence of any such reportable event;\n(iii) all premiums to the PBGC have been timely paid in full; (iv) no material\nliability (other than for premiums to the PBGC) under Title IV of ERISA has been\nor is expected to be incurred by the Company or any of its Subsidiaries; and (v)\nthe PBGC has not instituted proceedings to terminate any such Title IV Plan and,\nto the Company's knowledge, no condition exists that presents a risk that such\nproceedings will be instituted or which would constitute grounds under Section\n4042 of ERISA for the termination of, or the appointment of a trustee to\nadminister, any such Title IV Plan.\n\n      (i) There does not now exist, nor do any circumstances exist that could\nresult in, any Controlled Group Liability that would be a material liability of\nthe Company or any of its Subsidiaries following the Closing. None of the\nCompany and its Subsidiaries nor any of their respective ERISA Affiliates has\nincurred any material Withdrawal Liability that has not been satisfied in full.\nWith respect to each Employee Plan that is a Multiemployer Plan: (i) if the\nCompany or any of its Subsidiaries or any of their respective ERISA Affiliates\nwere to experience a withdrawal or partial withdrawal from such plan, no\nmaterial Withdrawal Liability would be incurred; and (ii) none of the Company\nand its Subsidiaries, nor any of their respective ERISA Affiliates has received\nany notification, nor has any reason to believe, that any such Employee Plan is\nin reorganization, has been terminated, is insolvent, or may reasonably be\nexpected to be in reorganization, to be insolvent, or to be terminated.\n\n      (j) The Company Disclosure Schedule sets forth: (i) an accurate and\ncomplete list of each material Employee Arrangement under which the execution\nand delivery of this Agreement or the consummation of the transactions\ncontemplated hereby could (either alone or in conjunction with any other event\nsuch as termination of employment) result in, cause the accelerated vesting,\nfunding or delivery of, or increase the amount or value of, any payment or\nbenefit to any employee, officer or director of the Company, or any of its\nSubsidiaries, or for which the Company or any of its Subsidiaries could be\nliable, or would limit the right of the Company or any of its Subsidiaries to\namend, merge, terminate or receive a reversion of assets from any material\nEmployee Arrangement or related trust; (ii) the aggregate dollar amounts payable\nby the Company and its Subsidiaries pursuant to or with respect to bonuses and\nother incentive compensation in connection with or as a result of the\nconsummation of the transactions contemplated hereby; (iii) the aggregate\nliabilities of the Company and its Subsidiaries, together with any corresponding\nassets held in any grantor trust of the Company and its Subsidiaries, pursuant\nto each Employee Arrangement (other than Employee Plans that are qualified under\nSection 401(a) of the Code) providing any supplemental or excess retirement\nbenefits or other deferred compensation (whether elective or nonelective), in\neach case determined as of the date \n\n\n                                       19\n\n\nset forth in the Company Disclosure Schedule and (iv) the aggregate amounts of\nchange-of-control severance and other change-of-control payments (whether\ncontingent or not) that have been or will be deferred under the Company's\nDeferred Compensation Plan. No outstanding options to purchase Shares granted to\nany current or former employee or director of the Company or any of its\nAffiliates contain any provision that would entitle the holder to receive any\ncash payment with respect thereto in connection with the consummation of the\ntransactions contemplated hereby in excess of the amounts provided for in\nSection 2.05 hereof.\n\n      (k) There are no pending or threatened claims (other than claims for\nbenefits in the ordinary course), investigations, lawsuits or arbitrations which\nhave been asserted or instituted, and, to the Company's knowledge, no set of\ncircumstances exists which may reasonably be expected to give rise to a claim or\nlawsuits, against the material Employee Arrangements, any fiduciaries thereof\nwith respect to their duties to such Employee Arrangements or the assets of any\nof the trusts under any of such Employee Arrangements which could reasonably be\nexpected to result in any material liability of the Company or any of its\nSubsidiaries to the PBGC, the Department of Treasury, the Department of Labor,\nor any other U.S. or foreign governmental authority, or to any of such Employee\nArrangements, any participant in any such Employee Arrangement, or any other\nparty. Without limiting the generality of the foregoing, neither the Company nor\nany of its Affiliates has any actual or contingent liability under any such\nEmployee Arrangement or under any applicable law or regulation for pay or\nbenefits incurred as a result of corporate restructuring, downsizing, layoffs or\nsimilar events that has not been fully satisfied or adequately reserved for in\nthe audited consolidated financial statements (including the related notes) and\nunaudited consolidated financial statements (including the related notes) of the\nCompany included in the Company SEC Documents.\n\n      SECTION 4.18. Environmental Matters. Except as would not reasonably be\nexpected to have, individually or in the aggregate, a Material Adverse Effect on\nthe Company:\n\n            (i) no written notice, demand, request for information, citation,\n      summons or order has been received, no penalty has been assessed, and no\n      investigation, action, claim, suit or proceeding is pending or, to the\n      knowledge of the Company, threatened by any Governmental Entity or other\n      Person which alleges a violation by the Company or any Subsidiary of the\n      Company of any Environmental Law;\n\n            (ii) the Company and its Subsidiaries are in compliance with all\n      Environmental Laws and all Environmental Permits; and\n\n            (iii) there are no liabilities or obligations of the Company or any\n      of its Subsidiaries of any kind whatsoever, whether accrued, contingent,\n      absolute, determined, determinable or otherwise arising (x) under or in\n      connection with any Environmental Law or any related claim or (y) in\n      connection with any environmental matter.\n\n      SECTION 4.19. Intellectual Property. The Company and its Subsidiaries own,\nor are \n\n\n                                       20\n\n\nvalidly licensed or otherwise have the right to use, all Company Intellectual\nProperty Rights used in the conduct of their businesses, except where the\nfailure to own or possess valid rights to such Company Intellectual Property\nRights would not, individually or in the aggregate, reasonably be expected to\nhave a Material Adverse Effect on the Company. No Company Intellectual Property\nRight is subject to any outstanding judgment, injunction, order, decree or\nagreement restricting the use thereof by the Company or any of its Subsidiaries\nor restricting the licensing thereof by the Company or any of its Subsidiaries\nto any Person, except for any judgment, injunction, order, decree or agreement\nwhich would not, individually or in the aggregate, reasonably be expected to\nhave a Material Adverse Effect on the Company. Neither the Company nor any of\nits Subsidiaries is infringing on any other Person's Intellectual Property\nRights and to the knowledge of the Company no Person is infringing on any\nCompany Intellectual Property Rights, except, in either case, as would not\nreasonably be expected, individually or in the aggregate, to have a Material\nAdverse Effect on the Company. Except for such matters as would not reasonably\nbe expected to have a Material Adverse Effect on the Company, as of May 31, 2000\n(i) neither the Company nor any of its Subsidiaries was a defendant in any\naction, suit, investigation or proceeding relating to, or otherwise was notified\nof, any alleged claim of infringement of any Intellectual Property Right and\n(ii) the Company and its Subsidiaries had no outstanding claim or suit for any\ncontinuing infringement by any other Person of any Company Intellectual Property\nRights.\n\n      SECTION 4.20. Antitakeover Statute. The Company has taken all action\nnecessary to exempt the Merger and this Agreement and the transactions\ncontemplated hereby from the provisions of Section 203 of Delaware Law.\n\n      SECTION 4.21. Real Property. Except as would not reasonably be expected,\nindividually or in the aggregate, to have a Material Adverse Effect on the\nCompany: (i) the Company or its Subsidiaries have good and marketable fee title\nor a valid leasehold interest in all of the real property and related equipment\nused by the Company or its Subsidiaries or otherwise reflected in the Company's\nfinancial statements identified in Section 4.08 above (collectively, the\n\"Company Properties\"), in each case free and clear of any Liens or rights of\nthird parties and (ii) the Company Properties (taking into account, without\nlimitation, all Liens related thereto, all zoning and other restrictions\napplicable thereto and the condition thereof) are suitable and adequate for the\nconduct of the businesses of the Company and its Subsidiaries as currently\nconducted.\n\n      SECTION 4.22. Contracts; Joint Ventures. (a) Except for employee benefit\nplans and any contracts filed as an exhibit to any Company SEC Documents (\"Filed\nContracts\"), Section 4.22(a) of the Company Disclosure Schedule lists all oral\nor written contracts, agreements, guarantees and leases that exist as of the\ndate hereof to which the Company or any of its Subsidiaries is a party or by\nwhich it is bound which are or would be required to be filed as an exhibit to\nthe Company SEC Documents (the listed contracts and the Filed Contracts, the\n\"Contracts\"). All of the Contracts governed by the laws of the United States or\nany state and, to the knowledge of the Company, all of the Contracts governed by\nthe laws of any foreign jurisdiction, are valid and binding obligations of the\nCompany or such Subsidiary and, to the \n\n\n                                       21\n\n\nknowledge of the Company, the valid and binding obligation of each other party\nthereto, with only such exceptions as would not, individually or in the\naggregate, have a Material Adverse Effect on the Company. Neither the Company or\nsuch Subsidiary nor, to the knowledge of the Company, any other party thereto is\nin violation of or in default in respect of, nor has there occurred an event or\ncondition which with the passage of time or giving of notice (or both) would\nconstitute a default under or permit the termination of, any such Contract,\nexcept such violations or defaults under or terminations which would not,\nindividually or in the aggregate, reasonably be expected to have a Material\nAdverse Effect on the Company.\n\n      (b) The Company has made available to Parent complete and correct copies\nof all agreements relating to the formation and governance of the Significant\nJoint Ventures (the \"JV Agreements\"). Other than as contained in the JV\nAgreements, the Company has no obligations of any kind whatsoever, whether\naccrued, contingent, absolute, determined, determinable or otherwise, to loan\nfunds to, make capital contributions to, or guarantee indebtedness or other\nobligations of, the Significant Joint Ventures.\n\n      SECTION 4.23. Indebtedness. At the date hereof, the Company and its\nSubsidiaries have outstanding indebtedness for borrowed money (including,\nwithout limitation, off-balance sheet indebtedness, guarantees of third party\nindebtedness and capitalized lease obligations) in an aggregate principal amount\nnot greater than $4.5 billion.\n\n                                    ARTICLE 5\n                    REPRESENTATIONS AND WARRANTIES OF PARENT\n\n      Parent represents and warrants to the Company that:\n\n      SECTION 5.01. Corporate Existence and Power. Each of Parent and Merger\nSubsidiary is a corporation duly incorporated, validly existing and in good\nstanding under the laws of its jurisdiction of incorporation and has all\ncorporate powers and all governmental licenses, authorizations, permits,\nconsents and approvals required to carry on its business as now conducted,\nexcept for those licenses, authorizations, permits, consents and approvals the\nabsence of which would not reasonably be expected to have, individually or in\nthe aggregate, a Material Adverse Effect on Parent. Since the date of its\nincorporation, Merger Subsidiary has not engaged in any activities other than in\nconnection with or as contemplated by this Agreement or in connection with\narranging any financing required to consummate the transactions contemplated\nhereby.\n\n      SECTION 5.02. Corporate Authorization. The execution, delivery and\nperformance by Parent and Merger Subsidiary of this Agreement and the\nconsummation by Parent and Merger Subsidiary of the transactions contemplated\nhereby are within the corporate powers of Parent and Merger Subsidiary and have\nbeen duly authorized by all necessary corporate action. This Agreement has been\nduly executed and delivered by Parent and Merger Subsidiary and \n\n\n                                       22\n\n\nconstitutes a valid and binding agreement of each of Parent and Merger\nSubsidiary.\n\n      SECTION 5.03. Governmental Authorization. The execution, delivery and\nperformance by Parent and Merger Subsidiary of this Agreement and the\nconsummation by Parent and Merger Subsidiary of the transactions contemplated\nhereby require no action by or in respect of, or filing with, any Governmental\nEntity, other than (i) the filing of a certificate of merger with respect to the\nMerger with the Delaware Secretary of State and appropriate documents with the\nrelevant authorities of other states in which Parent is qualified to do\nbusiness, (ii) compliance with any applicable requirements of the HSR Act and of\nlaws, rules and regulations in foreign jurisdictions governing antitrust or\nmerger control matters, (iii) compliance with any applicable requirements of the\n1933 Act, the 1934 Act and any other applicable securities or takeover laws,\nwhether state or foreign and (iv) any actions or filings the absence of which\nwould not reasonably be expected to have, individually or in the aggregate, a\nMaterial Adverse Effect on Parent or materially to impair the ability of Parent\nand Merger Subsidiary to consummate the transactions contemplated by this\nAgreement.\n\n      SECTION 5.04. Non-contravention. The execution, delivery and performance\nby Parent and Merger Subsidiary of this Agreement and the consummation by Parent\nand Merger Subsidiary of the transactions contemplated hereby do not and will\nnot (i) contravene, conflict with, or result in any violation or breach of any\nprovision of the certificate of incorporation or bylaws of Parent or Merger\nSubsidiary, (ii) assuming compliance with the matters referred to in Section\n5.03, contravene, conflict with, or result in any violation or breach of any\nprovision of any law, regulation, judgment, injunction, order or decree or (iii)\nrequire any consent or other action by any Person under, constitute (with or\nwithout notice of lapse of time or both) a default under, or cause or permit the\ntermination, cancellation, acceleration or other change of any right or\nobligation or the loss of any benefit to which Parent or Merger Subsidiary is\nentitled under any provision of any agreement or other instrument binding upon\nParent or Merger Subsidiary, except, in the case of clauses (ii) and (iii), for\nsuch matters as would not reasonably be expected to have, individually or in the\naggregate, a Material Adverse Effect on Parent or prevent or materially delay\nthe consummation of the Merger.\n\n      SECTION 5.05. Disclosure Documents. The information with respect to Parent\nand any of its Subsidiaries that Parent furnishes to the Company specifically\nfor use in the Company Information Statement will not contain any untrue\nstatement of a material fact or omit to state any material fact necessary in\norder to make the statements made therein, in the light of the circumstances\nunder which they were made, not misleading at the time such Company Information\nStatement or any amendment or supplement thereto is first mailed to stockholders\nof the Company.\n\n      SECTION 5.06. Finders' Fees. Except for Chase Securities Inc., Credit\nSuisse First Boston and Wasserstein Perella &amp; Co., Inc., whose fees will be paid\nby Parent, there is no investment banker, broker, finder or other intermediary\nthat has been retained by or is authorized to act on behalf of Parent who might\nbe entitled to any fee or commission from the Company or any of its Affiliates\nupon consummation of the transactions contemplated by this Agreement.\n\n\n                                       23\n\n\n      SECTION 5.07. Financing. Parent has received and furnished copies to the\nCompany of fully executed and operative agreements (the \"Financing Agreements\")\nwith Chase Securities Inc. and Credit Suisse First Boston Corp. dated as of June\n22, 2000 pursuant to which such entities have agreed, subject to the terms and\nconditions thereof, to provide financing to Parent in an amount sufficient,\ntogether with existing credit facilities, cash on hand and other liquid\nsecurities owned directly or indirectly by Parent, to pay all cash amounts\npayable to Company stockholders and optionholders in connection with the\ntransactions contemplated by this Agreement, to effect, assuming the accuracy of\nthe Company's representations in this Agreement, all necessary refinancing of\nexisting indebtedness of the Company and its Subsidiaries or of Parent and its\nSubsidiaries that is required as a result of the transactions contemplated by\nthis Agreement, and to pay all related fees and expenses. As of the date hereof,\nParent knows of no facts or circumstances that could reasonably be expected to\nresult in any of the conditions set forth in the Financing Agreements not being\nsatisfied.\n\n                                    ARTICLE 6\n                            COVENANTS OF THE COMPANY\n\n      The Company agrees that:\n\n      SECTION 6.01. Conduct of the Company. From the date hereof until the\nEffective Time, the Company and its Subsidiaries shall conduct their business\nand operate their properties in the ordinary course consistent with past\npractice and shall use their reasonable best efforts to preserve intact their\nbusiness organizations and relationships with third parties and to keep\navailable the services of their present officers and employees. Without limiting\nthe generality of the foregoing, except with the prior written consent of Parent\nor as contemplated by this Agreement or as set forth in the Company Disclosure\nSchedule, from the date hereof until the Effective Time neither the Company nor\nany of its Subsidiaries shall:\n\n      (a) declare, set aside or pay any dividend or other distribution with\nrespect to any share of its capital stock, other than (x) customary quarterly\ncash dividends on the Shares in an amount not to exceed $.188 per Share per\nquarter and (y) dividends and other distributions paid by any Subsidiary of the\nCompany to the Company or any wholly-owned Subsidiary of the Company;\n\n      (b) repurchase, redeem or otherwise acquire any shares of capital stock or\nother securities of, or other ownership interests in, the Company or any of its\nSubsidiaries;\n\n      (c) issue, deliver, pledge, encumber or sell any Shares, or any securities\nconvertible into Shares, or any rights, warrants or options to acquire any\nShares, other than (i) issuances pursuant to stock-based awards or options that\nare outstanding on the date hereof, as referenced in Section 4.05 of this\nAgreement, or are granted in accordance with the following clause (ii), and (ii)\nadditional options to acquire Shares granted at fair market value or other\nawards based on \n\n\n                                       24\n\n\nShares under the terms of the Company's stock plans as in effect on the date\nhereof in the ordinary course consistent with past practice, but in no event\nshall such options and awards relate to more than 100,000 Shares, nor shall any\nsuch options or awards be granted to any officers or directors of the Company or\ncontain any provisions relating to the acceleration of vesting that are\ntriggered by the execution of this Agreement or the consummation of the Merger;\n\n      (d) amend its Certificate of Incorporation or By-Laws or other comparable\norganizational documents or amend any terms of the outstanding securities of the\nCompany or its Subsidiaries;\n\n      (e) merge or consolidate with any other Person, make any investment in any\nother Person, including any joint venture, or acquire the stock or assets or\nrights of any other Person other than (i) pursuant to existing contracts or\ncommitments as set forth in Section 6.01 of the Company Disclosure Schedule,\n(ii) in each case in the ordinary course of business consistent with past\npractice, purchases of raw materials, property, plant and equipment, services\nand items used or consumed in the manufacturing process, (iii) capital\nexpenditures made pursuant to the Company's 2000 Capital Expenditure Program, a\ncopy of which has been made available to Parent, or (iv) transactions that are\nin the ordinary course consistent with past practice and not individually in\nexcess of $5 million;\n\n      (f) sell, lease, license or otherwise dispose of any Subsidiary or any\nassets, securities, rights or property other than (but for purposes of clauses\n(i) - (iii), excluding matters addressed in Section 6.01(r)) (i) pursuant to\nexisting contracts or commitments as set forth in Section 6.01 of the Company\nDisclosure Schedule, (ii) sales of inventory and equipment in the ordinary\ncourse of business consistent with past practice, or (iii) transactions that are\nin the ordinary course consistent with past practice and not individually in\nexcess of $10 million;\n\n      (g) incur any indebtedness (whether or not reflected on the Company's\nbalance sheet) for borrowed money, guarantee any such indebtedness, enter into\nany new or amend existing facilities relating to indebtedness, issue or sell any\ndebt securities or warrants or other rights to acquire any debt securities or\nguarantee any debt securities, other than any indebtedness, guarantee or\nissuance incurred under current facilities (or renewals or replacements thereof\nmade in consultation with Parent) in the ordinary course of business consistent\nwith past practice in an aggregate amount not to exceed $4.6 billion outstanding\nat any time or incurred between the Company and any of its wholly owned\nSubsidiaries or between any of such wholly owned Subsidiaries;\n\n      (h) except as required under any collective bargaining agreement (whether\nnow or hereafter in effect) or under Section 2.05 or as may be mutually agreed\nupon between Parent and the Company, enter into or adopt any new, or amend any\nexisting, Employee Arrangement, other than as required by law, except that, in\norder to retain a current employee or recruit a new employee, in each case\nconsistent with past practice, the Company or its Subsidiaries may amend\nEmployee Arrangements with individual employees who are not officers or\ndirectors of the \n\n\n                                       25\n\n\nCompany if such amendments will result in not more than a de minimis additional\ncost to the Company or its Subsidiaries and will not materially increase the\nobligations of the Company or its Subsidiaries;\n\n      (i) except (i) as permitted under Section 6.01(h) or (ii) to the extent\nrequired under any collective bargaining agreement (whether now or hereafter in\neffect) or by written employment agreements existing on the date of this\nAgreement and listed in the Company Disclosure Schedule, increase the\ncompensation payable or to become payable to its officers, directors or\nemployees, except for increases in the ordinary course of business consistent\nwith past practice in salaries or wages of employees (who are not executive\nofficers or directors of the Company or any of its Subsidiaries) that, in any\nevent, do not result in aggregate increases in such compensation by more than 2%\nover the compensation in effect on the date of this Agreement;\n\n      (j) renew any collective bargaining agreement or enter into any new\ncollective bargaining agreement, if such renewed or new collective bargaining\nagreement would materially increase the costs and\/or obligations imposed on the\nCompany and its Subsidiaries thereunder;\n\n      (k) contribute any amount to any Employee Arrangement or any trust or\nother arrangement funding any Employee Arrangement, except to the extent\nrequired by the existing terms of such Employee Arrangement, trust or other\nfunding arrangement, by any collective bargaining agreement now or hereafter in\neffect, by any written employment agreement existing on the date of this\nAgreement and listed in the Company Disclosure Schedule, or by applicable law;\n\n      (l) (i) adopt a plan of complete or partial liquidation, dissolution,\nmerger, consolidation, restructuring, recapitalization or other reorganization\nor (ii) enter into any agreement or exercise any discretion providing for\nacceleration of payment or performance as a result of a change of control of the\nCompany or its Subsidiaries;\n\n      (m) renew or enter into any non-compete, exclusivity or similar agreement\nthat would restrict or limit, in any material respect, the operations of the\nCompany or its Subsidiaries, or, after the Effective Time, of Parent or its\nSubsidiaries;\n\n      (n) enter into, modify in any material respect, amend in any material\nrespect or terminate any (i) Contract or (ii) agreement having a term longer\nthan one year and having an aggregate value over its term greater than $10\nmillion;\n\n      (o) (i) renew, enter into, amend or waive any material right under (A) any\ncontract with or loan to any Affiliate of the Company (other than its\nwholly-owned Subsidiaries), except with respect to certain employment matters as\npermitted under other covenants contained herein, (B) any distribution agreement\nthat is not terminable without penalty on thirty days notice, other than any\ndistribution agreement which involves or would be expected to involve monthly\nsales not in excess of $25,000 and which is otherwise in the ordinary course of\nbusiness consistent with past \n\n\n                                       26\n\n\npractice or (C) any JV Agreement except as permitted under Section 6.01(e)(2) of\nthe Company Disclosure Schedule, or (ii) exercise any voting or veto rights\nunder the United Biscuits transaction documents (as set forth in Section 4.10(h)\nof the Company Disclosure Schedule) with respect to acquisitions, dispositions\nor the incurrence of additional indebtedness, other than (x) the refinancing\ndescribed in such documents and (y) the fulfillment of any existing commitments\nof the Company and its Subsidiaries under such documents;\n\n      (p) settle or compromise any material litigation, or waive, release or\nassign any material claims, including with respect to any Company Intellectual\nProperty Rights;\n\n      (q) adopt any change, other than as required by the SEC or by GAAP, in its\naccounting policies, procedures or practices;\n\n      (r) sell, license, lease or otherwise dispose of any Company Intellectual\nProperty Rights or any brand or line of business, other than pursuant to\nagreements in place on the date hereof and disclosed in Section 6.01(r) of the\nCompany Disclosure Schedule;\n\n      (s) agree or commit to do any of the foregoing.\n\n      SECTION 6.02. Stockholder Action by Written Consent; Information Material.\nIn lieu of calling a meeting of the Company's stockholders, the Company will\nseek approval and adoption of this Agreement and the Merger by written consent\nof NGH. Such approval will be sought so that, on the same Business Day as the\nNGH Stockholder Meeting, such consent shall be obtained and shall be effective\n(assuming that the NGH Stockholder Approval (as defined in the NGH Voting\nAgreement) is obtained). Subject to Section 6.04(c), the Board of Directors of\nthe Company shall recommend approval and adoption of this Agreement and the\nMerger by the Company's stockholders. In connection with such action by written\nconsent, the Company will (i) promptly prepare and file with the SEC, use its\nbest efforts to have cleared by the SEC and thereafter mail to its stockholders\nas promptly as practicable the Company Information Statement, (ii) use its best\nefforts to obtain the necessary approvals by its stockholders of this Agreement\nand the transactions contemplated hereby and (iii) otherwise comply with all\nlegal requirements applicable to such approvals.\n\n      SECTION 6.03. Access to Information. From the date hereof until the\nEffective Time and subject to applicable law and the Confidentiality Agreement\ndated as of April 19, 2000 between NGH and Parent, as modified (the\n\"Confidentiality Agreement\"), the Company shall (i) give Parent, its counsel,\nfinancial advisors, auditors and other authorized representatives reasonable\naccess to the offices, properties, books and records of the Company and its\nSubsidiaries, (ii) furnish to Parent, its counsel, financial advisors, auditors\nand other authorized representatives such financial and operating data and other\ninformation as such Persons may reasonably request, (iii) instruct the\nemployees, counsel, financial advisors, auditors and other authorized\nrepresentatives of the Company and its Subsidiaries to cooperate with Parent in\nits investigation of the Company and its Subsidiaries and (iv) promptly advise\nParent orally and in writing of any \n\n\n                                       27\n\n\nfact or circumstance reasonably likely to have a Material Adverse Effect on the\nCompany. Any investigation pursuant to this Section shall be conducted in such\nmanner as not to interfere unreasonably with the conduct of the business of the\nCompany and its Subsidiaries. No information or knowledge obtained by Parent in\nany investigation pursuant to this Section shall affect or be deemed to modify\nany representation or warranty made by the Company hereunder.\n\n      SECTION 6.04. No Solicitation; Other Offers. (a) From the date hereof\nuntil the earlier of the Effective Time and the termination of this Agreement in\naccordance with Article 10, the Company and its Subsidiaries will not, and the\nCompany will use its reasonable best efforts to cause the officers, directors,\nemployees, investment bankers, consultants or other agents or representatives\n(collectively, \"Agents\") of the Company and its Subsidiaries not to, directly or\nindirectly, (i) solicit, initiate or encourage the submission of any Acquisition\nProposal, (ii) engage in discussions or negotiations with any Person concerning\nan Acquisition Proposal, (iii) disclose any nonpublic information relating to\nthe Company or any of its Subsidiaries to any Person who, to the knowledge of\nthe Company, is considering making, or has made, an Acquisition Proposal or (iv)\ntake any other action to facilitate any inquiries or the making of any proposal\nthat constitutes or that could reasonably be expected to lead to an Acquisition\nProposal. The Company will notify Parent promptly (but in no event later than 24\nhours) after receipt by the Company of any Acquisition Proposal or any request\nfor nonpublic information relating to the Company or any of its Subsidiaries by\nany Person who, to the knowledge of the Company, is making, or has made, an\nAcquisition Proposal. The Company shall promptly provide such notice orally and\nin writing and shall identify the Person making, and all terms and conditions\nof, any such Acquisition Proposal or request. The Company shall keep Parent\npromptly informed of the status and details of any such Acquisition Proposal\n(including amendments or proposed amendments) or request and any discussions or\nnegotiations pursuant to Section 6.04(b) and the Company shall provide to Parent\ncopies of any written communications between the Company and any Person making\nthe Acquisition Proposal. The Company shall, and the Company shall use\nreasonable best efforts to cause its Subsidiaries and the Agents of the Company\nand its Subsidiaries to, cease immediately and cause to be terminated all\nactivities, discussions and negotiations, if any, with any Persons conducted\nprior to the date hereof with respect to any Acquisition Proposal. Nothing\ncontained in this Agreement shall prevent the Board of Directors of the Company\nfrom complying with Rule 14d-9 or Rule 14e-2 under the 1934 Act with respect to\nany Acquisition Proposal.\n\n      (b) Notwithstanding the foregoing, the Company may prior to receipt of the\nNGH Stockholder Approval (as defined in the NGH Voting Agreement), negotiate or\notherwise engage in substantive discussions with, and furnish nonpublic\ninformation to, any Person in response to an unsolicited Acquisition Proposal by\nsuch Person if (i) the Company has complied with the terms of Section 6.04(a),\n(ii) the Board of Directors of the Company determines in good faith that such\nAcquisition Proposal is likely to result in a Superior Proposal and, after\nconsultation with outside legal counsel, that the failure to take such action\nwould constitute a breach of its fiduciary duties under applicable law, (iii)\nsuch Person executes a confidentiality agreement with terms no less favorable to\nthe Company than those contained in the Confidentiality Agreement (except as to\nthe standstill provisions) and (iv) the Company shall have delivered to Parent\nprior \n\n\n                                       28\n\n\nwritten notice advising Parent that it intends to take such action.\n\n      (c) The Board of Directors of the Company shall be permitted to withdraw,\nor modify in a manner adverse to Parent, its recommendation to its stockholders\nreferred to in Section 6.02 hereof, but only if (i) the Company has complied\nwith the terms of Section 6.04(a), (ii) the Company has received an unsolicited\nAcquisition Proposal which the Board of Directors determines in good faith\nconstitutes a Superior Proposal, (iii) the Board of Directors of the Company\ndetermines in good faith, after consultation with outside legal counsel, that\nthe failure to take such action would constitute a breach of its fiduciary\nduties under applicable law and (iv) the Company shall have delivered to Parent\na prior written notice advising Parent that it intends to take such action.\n\n      (d) For purposes of this Agreement:\n\n      \"Acquisition Proposal\" means any offer or proposal for a merger,\nreorganization, consolidation, share exchange, business combination, or other\nsimilar transaction involving the Company or any of its Subsidiaries or any\nproposal or offer to acquire, directly or indirectly, more than 35% of the\nvoting securities of the Company, or a substantial portion of the assets of the\nCompany and its Subsidiaries taken as a whole, other than the transactions\ncontemplated by this Agreement.\n\n      \"Superior Proposal\" means any bona fide written Acquisition Proposal (i)\non terms that the Board of Directors of the Company determines in good faith\n(after consultation with a financial advisor of nationally recognized reputation\nand taking into account all the terms and conditions of the Acquisition Proposal\nincluding the legal, financial and regulatory aspects of the proposal) provide\ngreater value to the Company's stockholders than the transaction contemplated\nhereunder, as amended pursuant to Section 10.01(d) if applicable and (ii) that\nis reasonably likely to be consummated by the Person making such Acquisition\nProposal.\n\n      (e) The Company will promptly provide to Parent any information regarding\nthe Company provided to any Person making an Acquisition Proposal that was not\npreviously provided to Parent.\n\n      SECTION 6.05. Third Party Standstill Agreements. During the period from\nthe date of this Agreement until the Effective Time or earlier termination of\nthis Agreement, the Company shall not terminate, amend, modify or waive any\nprovision of any confidentiality or standstill agreement relating to the making\nof an Acquisition Proposal to which it or any of its Subsidiaries is a party\n(other than any involving Parent or its Subsidiaries). During such period, the\nCompany agrees to use reasonable best efforts to enforce, to the fullest extent\npermitted under applicable law, the provisions of any such agreements, including\nseeking injunctions to prevent any breaches of such agreements and to enforce\nspecifically the terms and provisions thereof in any court of the United States\nor any state thereof having jurisdiction.\n\n\n                                       29\n\n\n                                    ARTICLE 7\n                               COVENANTS OF PARENT\n\n      Parent agrees that:\n\n      SECTION 7.01. Confidentiality. Prior to the Effective Time and after any\ntermination of this Agreement, Parent will hold, and will use its reasonable\nbest efforts to cause its officers, directors, employees, accountants, counsel,\nconsultants, advisors and agents to hold, in confidence all documents and\ninformation concerning the Company or any of its Subsidiaries furnished to\nParent or its Affiliates in connection with the transactions contemplated by\nthis Agreement in accordance with the terms of the Confidentiality Agreement.\n\n      SECTION 7.02. Obligations of Merger Subsidiary. Parent will take all\naction necessary to cause Merger Subsidiary to perform its obligations under\nthis Agreement and to consummate the Merger on the terms and conditions set\nforth in this Agreement.\n\n      SECTION 7.03. Director and Officer Liability. Parent shall cause the\nSurviving Corporation, and the Surviving Corporation hereby agrees, to do the\nfollowing:\n\n      (a) For six years after the Effective Time, the Surviving Corporation\nshall indemnify and hold harmless each present and former officer and director\nof the Company (each an \"Indemnified Person\") in respect of acts or omissions\noccurring at or prior to the Effective Time to the fullest extent permitted by\nDelaware Law or any other applicable laws or provided under the Company's\ncertificate of incorporation and bylaws in effect on the date hereof, provided\nthat such indemnification shall be subject to any limitation imposed from time\nto time under applicable law.\n\n      (b) The Surviving Corporation shall pay all expenses, including reasonable\nfees and expenses of counsel, that an Indemnified Person may incur in enforcing\nthe indemnity and other obligations provided for in this Section 7.03. The\nSurviving Corporation shall be entitled to assume the defense of any action,\nsuit, investigation or proceeding and the Surviving Corporation shall not be\nliable to any Indemnified Person for any legal expenses of separate counsel or\nany other expenses subsequently incurred by such Indemnified Person in\nconnection with the defense thereof, except that if the Surviving Corporation\nelects not to assume such defense or counsel for the Indemnified Person advises\nthat there are issues that raise conflicts of interest between the Surviving\nCorporation and the Indemnified Person, the Indemnified Person may retain\ncounsel reasonably satisfactory to the Surviving Corporation, and the Surviving\nCorporation shall pay all reasonable fees and expenses of such counsel for the\nIndemnified Person promptly as statements therefor are received; provided that\nthe Surviving Corporation shall not be liable for the fees of more than one\ncounsel for all Indemnified Persons, other than local counsel, unless a conflict\nof interest shall be caused thereby, and provided further that the Surviving\nCorporation shall not be liable for any settlement effected without its written\nconsent (which consent shall not be unreasonably withheld).\n\n\n                                       30\n\n\n      (c) For six years after the Effective Time, the Surviving Corporation\nshall provide officers' and directors' liability insurance in respect of acts or\nomissions occurring prior to the Effective Time covering each such Indemnified\nPerson currently covered by the Company's officers' and directors' liability\ninsurance policy on terms with respect to coverage and amount no less favorable\nthan those of such policy in effect on the date hereof; provided if the\naggregate annual premiums for such insurance at any time during such period\nshall exceed 200% of the per annum rate of premium paid by the Company and its\nSubsidiaries as of the date hereof for such insurance, then Parent shall, or\nshall cause its Subsidiaries to, provide only such coverage as shall then be\navailable at an annual premium equal to 200% of such rate.\n\n      (d) If the Surviving Corporation or any of its successors or assigns (i)\nconsolidates with or merges into any other Person and shall not be the\ncontinuing or surviving corporation or entity of such consolidation or merger,\nor (ii) transfers or conveys all or substantially all of its properties and\nassets to any Person, then, and in each such case, to the extent necessary,\nproper provision shall be made so that the successors and assigns of the\nSurviving Corporation, as the case may be, shall assume the obligations set\nforth in this Section 7.03.\n\n      (e) The rights of each Indemnified Person under this Section 7.03 shall be\nin addition to any rights such Person may have under the certificate of\nincorporation or bylaws of the Company or any of its Subsidiaries, under\nDelaware Law or any other applicable laws or under any agreement of any\nIndemnified Person with the Company or any of its Subsidiaries. These rights\nshall survive consummation of the Merger and are intended to benefit, and shall\nbe enforceable by, each Indemnified Person.\n\n      SECTION 7.04. Employee Matters. (a) For a period of two years after the\nEffective Time, the Surviving Corporation will provide employee compensation and\nbenefits for the benefit of current and former employees of the Company and its\nSubsidiaries, other than employees represented by collective bargaining units\nand employees with which the Company or NGH have entered into employment\nagreements (the compensation and benefits for which such employees shall be in\naccordance with their respective collective bargaining agreement or employment\nagreement), (\"Company Employees\") that are in the aggregate not less favorable\nto such employees than the Employee Arrangements. The foregoing notwithstanding,\nin the event the employment of any Company Employee is terminated other than for\ncause during the two-year period beginning at the Effective Time, such employee\nshall receive severance or separation benefits in an aggregate amount at least\nequal to the severance or separation benefits such employee would have received\nunder such circumstances under the Employee Arrangements listed in the Company\nDisclosure Schedule.\n\n      (b) The Surviving Corporation shall give Company Employees full credit for\npurposes of eligibility, vesting and, for purposes of vacation and severance\nbenefits only, benefit accrual under any such plans or arrangements maintained\nby the Surviving Corporation pursuant to Section 7.04(a) for such employees'\nservice recognized for such purposes under the Employee \n\n\n                                       31\n\n\nArrangements.\n\n      (c) As soon as practicable after the date of this Agreement, the Company\nshall take all steps necessary or appropriate to (i) delete from the Company's\nDeferred Compensation Plan and all other Employee Arrangements (other than\nEmployee Plans that are qualified under Section 401(a) of the Code and contracts\ncurrently in effect with individual employees with respect to benefits accrued\nas of the date of this Agreement) providing any supplemental or excess\nretirement benefits or other deferred compensation (whether elective or\nnonelective) any and all provisions limiting or eliminating the ability to amend\nor terminate such plans after a \"change of control\" or similar events, except\nfor such limitations that merely prevent the reduction or elimination of rights\nand benefits that have already vested or accrued thereunder, and (ii) ensure\nthat the provision for employer matching contributions under the Company's\nDeferred Compensation Plan does not apply to amounts deferred under that plan\nthat are payable as a result of a \"change of control\" or otherwise in connection\nwith the consummation of the transactions contemplated hereby, and to eliminate\nsuch provision effective not later than the Effective Time.\n\n      (d) Nothing contained in this Agreement shall be construed to prevent the\ntermination of employment of any Company Employee or the amendment or\ntermination of any particular Employee Arrangement to the extent permitted by\nits terms as in effect immediately before the Effective Time.\n\n                                    ARTICLE 8\n                       COVENANTS OF PARENT AND THE COMPANY\n\n      The parties hereto agree that:\n\n      SECTION 8.01. Reasonable Best Efforts. Subject to the terms and conditions\nof this Agreement, Company and Parent will use their reasonable best efforts to\ntake, or cause to be taken, all actions and to do, or cause to be done, all\nthings necessary, proper or advisable under applicable laws and regulations to\nconsummate the transactions contemplated by this Agreement. In furtherance and\nnot in limitation of the foregoing, each of Parent and Company agrees (i) to\nmake an appropriate filing of a Notification and Report Form pursuant to the HSR\nAct (and to make such other filings as are required under laws, rules and\nregulations in foreign jurisdictions governing antitrust or merger control\nmatters) with respect to the transactions contemplated hereby as promptly as\npracticable after the date hereof and to supply as promptly as practicable any\nadditional information and documentary material that may be requested pursuant\nto the HSR Act (or pursuant to such foreign laws, rules or regulations) and (ii)\nto take all other actions necessary to cause the expiration or termination of\nthe applicable waiting periods under the HSR Act (and to obtain the necessary\napprovals under such foreign laws, rules or regulations) as soon as practicable,\nincluding, in the case of Parent, entering into any required settlement,\n\n\n                                       32\n\n\nundertaking, consent decree or stipulation with any Governmental Entity or\nimplementing any required divestiture, hold separate or similar transaction with\nrespect to any assets; provided, that, Parent shall not be required to agree,\nand the Company shall not agree without Parent's consent, to waive any\nsubstantial rights or to accept any substantial limitation on its operations or\nto dispose of any significant assets in connection with obtaining any such\nconsent or authorization unless such waiver, limitation or disposition would not\nreasonably be expected to have a Material Adverse Effect on the Company, Parent\nor Parent's food business, and provided, further, that at Parent's written\nrequest, the Company shall agree to any such waiver, limitation or disposal,\nwhich agreement may, at the Company's option, be conditioned upon and effective\nonly as of the Effective Time.\n\n      SECTION 8.02. Certain Filings. The Company and Parent shall cooperate with\none another and use their best efforts (i) in connection with the preparation of\nthe Company Information Statement, (ii) in determining whether any action by or\nin respect of, or filing with, any governmental body, agency, official, or\nauthority is required, or any actions, consents, approvals or waivers are\nrequired to be obtained from parties to any material contracts, in connection\nwith the consummation of the transactions contemplated by this Agreement and\n(iii) in taking such actions or making any such filings, furnishing information\nrequired in connection therewith or with the Company Information Statement and\nseeking timely to obtain any such actions, consents, approvals or waivers.\n\n      SECTION 8.03. Public Announcements. Parent and the Company will consult\nwith each other before issuing any press release or making any public statement\nwith respect to this Agreement or the transactions contemplated hereby and,\nexcept as may be required by applicable law or any listing agreement with any\nnational securities exchange, will not issue any such press release or make any\nsuch public statement prior to such consultation.\n\n      SECTION 8.04. Further Assurances. At and after the Effective Time, the\nofficers and directors of the Surviving Corporation will be authorized to\nexecute and deliver, in the name and on behalf of the Company or Merger\nSubsidiary, any deeds, bills of sale, assignments or assurances and to take and\ndo, in the name and on behalf of the Company or Merger Subsidiary, any other\nactions and things to vest, perfect or confirm of record or otherwise in the\nSurviving Corporation any and all right, title and interest in, to and under any\nof the rights, properties or assets of the Company acquired or to be acquired by\nthe Surviving Corporation as a result of, or in connection with, the Merger.\n\n      SECTION 8.05. Notices of Certain Events. Each of the Company and Parent\nshall promptly notify the other of:\n\n      (a) any notice or other communication from any Person alleging that the\nconsent of such Person is or may be required in connection with the transactions\ncontemplated by this Agreement;\n\n      (b) any notice or other communication from any Governmental Entity in\nconnection \n\n\n                                       33\n\n\nwith the transactions contemplated by this Agreement; and\n\n      (c) any actions, suits, claims, investigations or proceedings commenced\nor, to its knowledge, threatened against, relating to or involving or otherwise\naffecting the Company, Parent or any of their respective Subsidiaries that\nrelate to the consummation of the transactions contemplated by this Agreement.\n\n                                    ARTICLE 9\n                            CONDITIONS TO THE MERGER\n\n      SECTION 9.01. Conditions to Obligations of Each Party. The obligations of\nthe Company, Parent and Merger Subsidiary to consummate the Merger are subject\nto the satisfaction of the following conditions:\n\n      (a) this Agreement shall have been approved and adopted by the\nstockholders of the Company in accordance with Delaware Law;\n\n      (b) no provision of any applicable law or regulation and no judgment,\ntemporary restraining order, preliminary or permanent injunction, order, decree\nor other legal restraint or prohibition shall prohibit the consummation of the\nMerger;\n\n      (c) any applicable waiting period under the HSR Act relating to the Merger\nshall have expired or been terminated; and\n\n      (d) Parent and the Company shall have received in respect of the Merger\nand any matters arising therefrom confirmation by way of a decision from the\nCommission of the European Communities under Regulation No. 4064\/89 (with or\nwithout the initiation of proceedings under Article 6(1)(c) thereof) that the\nMerger and any matters arising therefrom are compatible with the common market.\n\n      SECTION 9.02. Conditions to the Obligations of Parent and Merger\nSubsidiary. The obligations of Parent and Merger Subsidiary to consummate the\nMerger are subject to the satisfaction of the following further conditions:\n\n      (a) the Company shall have performed in all material respects all of its\nobligations hereunder required to be performed by it at or prior to the\nEffective Time;\n\n      (b) except with respect to the representations and warranties of the\nCompany contained in Section 4.10(a) of this Agreement, the representations and\nwarranties of the Company contained in this Agreement and in any certificate or\nother writing delivered by the Company pursuant hereto, disregarding all\nqualifications and exceptions contained therein relating to \n\n\n                                       34\n\n\nmateriality or Material Adverse Effect or any similar standard or qualification,\nshall be true in all material respects at and as of the Effective Time as if\nmade at and as of such time (or, if given as of a specific date, at and as of\nsuch date) with only such exceptions as would not reasonably be expected to\nhave, individually or in the aggregate, a Material Adverse Effect on the\nCompany;\n\n      (c) the representations and warranties of the Company contained in Section\n4.10(a) of this Agreement shall be true at and as of the Effective Time as if\nmade at and as of such time;\n\n      (d) Parent shall have received a certificate signed by an executive of the\nCompany to the foregoing effect; and\n\n      (e) all consents or approvals of any Governmental Entity required in\nconnection with the consummation of the transactions contemplated hereby shall\nhave been obtained, except for such consents or approvals which, if not\nobtained, would not, individually or in the aggregate, have a Material Adverse\nEffect on the Company;\n\n      SECTION 9.03. Conditions to the Obligations of the Company. The\nobligations of the Company to consummate the Merger are subject to the\nsatisfaction of the following further conditions:\n\n      (a) each of Parent and Merger Subsidiary shall have performed in all\nmaterial respects all of its obligations hereunder required to be performed by\nit at or prior to the Effective Time;\n\n      (b) the representations and warranties of Parent and Merger Subsidiary\ncontained in this Agreement and in any certificate or other writing delivered by\nParent or Merger Subsidiary pursuant hereto, disregarding all qualifications and\nexceptions contained therein relating to materiality or Material Adverse Effect\nor any similar standard or qualification, shall be true in all material respects\nat and as of the Effective Time as if made at and as of such time (or, if given\nas of a specific date, at and as of such date) with only such exceptions as\nwould not reasonably be expected to have, individually or in the aggregate, a\nMaterial Adverse Effect on Parent; and\n\n      (c) the Company shall have received a certificate signed by an executive\nofficer of Parent to the foregoing effect.\n\n                                   ARTICLE 10\n                                   TERMINATION\n\n      SECTION 10.01. Termination. This Agreement may be terminated and the\nMerger may be abandoned at any time prior to the Effective Time (notwithstanding\nany approval of this Agreement by the stockholders of the Company):\n\n\n                                       35\n\n\n      (a) by mutual written agreement of the Company and Parent;\n\n      (b) by either the Company or Parent, if:\n\n            (i) the Merger has not been consummated on or before April 30, 2001,\n      provided that the right to terminate this Agreement pursuant to this\n      Section 10.01(b)(i) shall not be available to any party whose breach of\n      any provision of this Agreement results in the failure of the Merger to be\n      consummated by such time;\n\n            (ii) there shall be any law or regulation that makes consummation of\n      the Merger illegal or otherwise prohibited or any judgment, injunction,\n      order or decree of any Governmental Entity enjoining Company or Parent\n      from consummating the Merger is entered and such judgment, injunction,\n      decree or order shall have become final and nonappealable;\n\n            (iii) this Agreement shall not have been approved and adopted in\n      accordance with Delaware Law by the Company's stockholders by reason of\n      the failure to obtain the required vote of NGH's stockholders for approval\n      of the sale of NGH's Shares pursuant this Agreement at a duly held meeting\n      (including any adjournments thereof) of NGH's stockholders (the \"NGH\n      Stockholder Meeting\"); or\n\n            (iv) the NGH Voting Agreement shall have terminated pursuant to\n      Section 7(b) or 7(c) thereof;\n\n      (c) by Parent, if\n\n            (i) the Board of Directors of the Company shall have failed to\n      recommend or shall have withdrawn, or modified in a manner adverse to\n      Parent, its approval or recommendation of this Agreement or the Merger,\n      shall have approved or recommended a Superior Proposal, or shall have\n      resolved to do any of the foregoing,\n\n            (ii) the Company shall have entered into, or publicly announced its\n      intention to enter into, a definitive agreement or an agreement in\n      principle with respect to a Superior Proposal; or\n\n            (iii) the Company shall have (1) failed to perform in any material\n      respect any material obligation or to comply in any material respect with\n      any material agreement or covenant of the Company to be performed or\n      complied with by it under this Agreement or (2) breached any of its\n      representations or warranties such that the condition set forth in Section\n      9.02(b) or 9.02(c) cannot be satisfied, which failure under clause (1) or\n      (2) shall not be cured within 15 Business Days of notice from Parent (or\n      such longer period during which the Company exercises reasonable best\n      efforts to cure);\n\n\n                                       36\n\n\n      (d) by the Company, if the Board of Directors of the Company authorizes\nthe Company, subject to complying with the terms of this Agreement, to enter\ninto a written agreement concerning a Superior Proposal, provided however that\n(i) the Company shall have complied with Section 6.04, (ii) the Company shall\nhave given Parent at least three Business Days written prior notice of its\nintention to terminate the Agreement, attaching a description of all material\nterms and conditions of the Superior Proposal to such notice, (iii) during such\nthree Business Days or greater period, the Company engages in good faith\nnegotiations with Parent with respect to such changes as Parent may propose to\nthe terms of the Merger and this Agreement, (iv) Parent does not make prior to\nsuch termination of this Agreement a definitive, binding offer which the Board\nof Directors of the Company determines, in good faith after consultation with\nits financial advisors, is at least as favorable to the stockholders of the\nCompany as the Superior Proposal, and (v) the Company prior to such termination\npursuant to this Section 10.01(d) pays to Parent in immediately available funds\nthe fee required to be paid pursuant to Section 11.04(b). The Company agrees to\nnotify Parent promptly if its intention to enter into a written agreement\nreferred to in its notification shall change at any time after giving such\nnotification;\n\n      (e) by the Company, if Parent or Merger Subsidiary shall have (i) failed\nto perform in any material respect any material obligation or to comply in any\nmaterial respect with any material agreement or covenant of Parent or Merger\nSubsidiary to be performed or complied with by it under this Agreement or (ii)\nbreached any of such party's representations or warranties contained in this\nAgreement such that the condition set forth in Section 9.03(b) cannot be\nsatisfied, which failure or breach described in such clause (i) or (ii) shall\nnot be cured within 15 Business Days of notice from the Company (or such longer\nperiod during which Parent or Merger Subsidiary exercises reasonable best\nefforts to cure); or\n\n      (f) by either the Company or Parent, if since the date of this Agreement,\nthere has been a change in the Code, final or temporary Treasury Regulations\npromulgated under Section 355(e) or Section 358(g), published pronouncements of\nthe Internal Revenue Service having the same force and effect as final or\ntemporary Treasury Regulations promulgated under Section 355(e) or Section\n358(g), case law applying Section 355(e) or Section 358(g), or other relevant\nbinding legal authority relating to Section 355(e) or Section 358(g)\n(collectively \"Change in Tax Law\"), that (i) would apply to a transaction\nconsummated subsequent to such Change in Tax Law notwithstanding the existence\nof a binding written agreement with respect to such transaction, and (ii) would\nreasonably be expected to result in (A) the imposition of tax on gain realized\nwith respect to the stock of the Company arising out of the distribution on May\n18, 1999 by R.J. Reynolds Tobacco Holdings, Inc. (\"RJR\") to NGH of all of the\noutstanding Class B Shares or on gain realized with respect to the stock of RJR\narising out of the distribution on June 14, 1999 by NGH to the holders of its\ncommon stock of all of the outstanding common stock of RJR, or (B) a material\nincrease in the tax liability of NGH resulting from the Merger as compared to\nthe tax liability that would have arisen in the absence of such Change in Tax\nLaw.\n\nThe party desiring to terminate this Agreement pursuant to this Section 10.01\n(other than \n\n\n                                       37\n\n\npursuant to Section 10.01(a)) shall give notice of such termination to the other\nparty.\n\n      SECTION 10.02. Effect of Termination. If this Agreement is terminated\npursuant to Section 10.01, this Agreement shall become void and of no effect\nwith no liability on the part of any party (or any stockholder, director,\nofficer, employee, agent, consultant or representative of such party) to the\nother party hereto, provided that, if such termination shall result from the\nwillful (i) failure of either party to fulfill a condition to the performance of\nthe obligations of the other party or (ii) failure of either party to perform a\ncovenant hereof, such party shall be fully liable for any and all liabilities\nand damages incurred or suffered by the other party as a result of such failure.\nThe provisions of Sections 7.01, 11.04, 11.06, 11.07 and 11.08 shall survive any\ntermination hereof pursuant to Section 10.01.\n\n                                   ARTICLE 11\n                                  MISCELLANEOUS\n\n      SECTION 11.01. Notices. All notices, requests and other communications to\nany party hereunder shall be in writing (including facsimile transmission) and\nshall be given,\n\n      if to Parent or Merger Subsidiary, to:\n\n            Philip Morris Companies Inc.\n            120 Park Avenue\n            New York, New York 10017\n            Attention: Charles R. Wall\n            Fax: (917) 663-5817\n\n            with a copy to:\n\n            Wachtell, Lipton, Rosen &amp; Katz\n            51 West 52nd Street\n            New York, New York 10019\n            Attention: Martin Lipton\n                       Andrew J. Nussbaum\n            Fax: (212) 403-2000\n\n            and\n\n            Hunton &amp; Williams\n            200 Park Avenue\n            New York, New York 10166\n            Attention: Jerry E. Whitson\n            Fax: (212) 309-1100\n\n\n                                       38\n\n\n      if to the Company, to:\n\n            Nabisco Holdings Corp.\n            7 Campus Drive\n            Parsippany, New Jersey 07054\n            Attention: James A. Kirkman III\n            Fax: (973) 539-9150\n\n            with a copy to:\n\n            Davis Polk &amp; Wardwell\n            450 Lexington Avenue\n            New York, New York 10017\n            Attention: William L. Rosoff\n            Fax: (212) 450-4800\n\nor such other address or facsimile number as such party may hereafter specify\nfor the purpose by notice to the other parties hereto. All such notices,\nrequests and other communications shall be deemed received on the date of\nreceipt by the recipient thereof if received prior to 5 p.m. in the place of\nreceipt and such day is a Business Day in the place of receipt. Otherwise, any\nsuch notice, request or communication shall be deemed not to have been received\nuntil the next succeeding Business Day in the place of receipt.\n\n      SECTION 11.02. Non-Survival of Representations and Warranties. The\nrepresentations and warranties contained herein and in any certificate or other\nwriting delivered pursuant hereto shall not survive the Effective Time or the\ntermination of this Agreement.\n\n      SECTION 11.03. Amendments; No Waivers. (a) Any provision of this Agreement\nmay be amended or waived prior to the Effective Time if, but only if, such\namendment or waiver is in writing and is signed, in the case of an amendment, by\neach party to this Agreement or, in the case of a waiver, by each party against\nwhom the waiver is to be effective, provided that, after the adoption of this\nAgreement by the stockholders of the Company and without their further approval,\nno such amendment or waiver shall reduce the amount or change the kind of\nconsideration to be received in exchange for the Shares.\n\n      (b) No failure or delay by any party in exercising any right, power or\nprivilege hereunder shall operate as a waiver thereof nor shall any single or\npartial exercise thereof preclude any other or further exercise thereof or the\nexercise of any other right, power or privilege. The rights and remedies herein\nprovided shall be cumulative and not exclusive of any rights or remedies\nprovided by law.\n\n      SECTION 11.04. Expenses. (a) Except as otherwise provided in this Section,\nall costs and expenses incurred in connection with this Agreement shall be paid\nby the party incurring such \n\n\n                                       39\n\n\ncost or expense.\n\n      (b) If:\n\n            (i) the Company shall terminate this Agreement pursuant to Section\n      10.01(d);\n\n            (ii) Parent shall terminate this Agreement (A) pursuant to Section\n      10.01(c)(i) or 10.01(c)(ii), or (B) pursuant to Section 10.01(c)(iii)\n      (other than as a result of a breach of representation not caused by action\n      (including breach of a covenant contained herein) of the Company after the\n      date hereof and not capable of being cured using reasonable best efforts)\n      if, in the case of this clause (B), at such time a third party shall have\n      made an Acquisition Proposal and within nine months after termination of\n      this Agreement the Company enters into a definitive agreement in respect\n      of any Acquisition Proposal or such a transaction is consummated; or\n\n            (iii) either the Company or Parent shall terminate this Agreement\n      pursuant to Section 10.01(b)(iii) or 10.01(b)(iv) and (A) prior to the NGH\n      Stockholder Meeting a third party or the Company shall have publicly\n      announced an Acquisition Proposal and (B) within nine months after\n      termination of this Agreement the Company enters into a definitive\n      agreement in respect of any Acquisition Proposal or such a transaction is\n      consummated;\n\nthen in any case as described in clause (i), (ii) or (iii), the Company shall\npay to Parent (by wire transfer of immediately available funds not later than\nthe date of termination of this Agreement or, in the case of clauses (ii)(B) and\n(iii), the earlier of the date of such definitive agreement or consummation of\nsuch a transaction) an amount equal to $445 million, less any amounts previously\npaid pursuant to Section 11.04(c); provided however that such amount shall be\nreduced by the amount of any fee paid by NGH to Parent pursuant to Section 8(b)\nof the NGH Voting Agreement. The Company shall be entitled to deduct and\nwithhold from any payments made to Parent under this Section 11.04(b) such\namounts as may be required to be deducted or withheld therefrom under the Code\nor under any applicable provisions of state or local tax law. To the extent such\namounts are so deducted or withheld, such amounts shall be treated for purposes\nof this Section 11.04(b) as having been paid to Parent.\n\n      (c) If:\n\n            (i) Parent shall terminate this Agreement pursuant to Section\n      10.01(c)(iii) and at such time a third party shall have made an\n      Acquisition Proposal; or\n\n            (ii) the Company or Parent shall terminate this Agreement pursuant\n      to Section 10.01(b)(iii);\n\nthen the Company shall within five Business Days pay to Parent in immediately\navailable funds up to $30 million as reimbursement for documented expenses\nincurred in connection with the \n\n\n                                       40\n\n\nnegotiation and execution of this Agreement.\n\n      (d) If the Company shall terminate this Agreement pursuant to Section\n10.01(e), then Parent shall within five Business Days pay to the Company in\nimmediately available funds up to $30 million as reimbursement for documented\nexpenses incurred in connection with the negotiation and execution of this\nAgreement.\n\n      SECTION 11.05. Successors and Assigns. The provisions of this Agreement\nshall be binding upon and inure to the benefit of the parties hereto and their\nrespective successors and assigns, provided that no party may assign, delegate\nor otherwise transfer any of its rights or obligations under this Agreement\nwithout the consent of each other party hereto, except that Parent or Merger\nSubsidiary may transfer or assign, in whole or from time to time in part, to one\nor more of its Affiliates, the right to enter into the transactions contemplated\nby this Agreement, but no such transfer or assignment will relieve Parent or\nMerger Subsidiary of its obligations hereunder.\n\n      SECTION 11.06. Governing Law. This Agreement shall be governed by and\nconstrued in accordance with the law of the State of Delaware, without regard to\nthe conflicts of law rules of such state.\n\n      SECTION 11.07. Jurisdiction. Any suit, action or proceeding seeking to\nenforce any provision of, or based on any matter arising out of or in connection\nwith, this Agreement or the transactions contemplated hereby may be brought in\nany federal court located in the State of Delaware or any Delaware state court,\nand each of the parties hereby consents to the jurisdiction of such courts (and\nof the appropriate appellate courts therefrom) in any such suit, action or\nproceeding and irrevocably waives, to the fullest extent permitted by law, any\nobjection that it may now or hereafter have to the laying of the venue of any\nsuch suit, action or proceeding in any such court or that any such suit, action\nor proceeding brought in any such court has been brought in an inconvenient\nform. Process in any such suit, action or proceeding may be served on any party\nanywhere in the world, whether within or without the jurisdiction of any such\ncourt. Without limiting the foregoing, each party agrees that service of process\non such party as provided in Section 11.01 shall be deemed effective service of\nprocess on such party.\n\n      SECTION 11.08. WAIVER OF JURY TRIAL. EACH OF THE PARTIES HERETO HEREBY\nIRREVOCABLY WAIVES ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING\nARISING OUT OF OR RELATED TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED\nHEREBY.\n\n      SECTION 11.09. Counterparts; Effectiveness; Benefit. This Agreement may be\nsigned in any number of counterparts, each of which shall be an original, with\nthe same effect as if the signatures thereto and hereto were upon the same\ninstrument. This Agreement shall become effective when each party hereto shall\nhave received counterparts hereof signed by all of the other parties hereto.\nExcept as provided in Section 7.03, no provision of this Agreement is intended\nto confer any rights, benefits, remedies, obligations, or liabilities hereunder\nupon any \n\n\n                                       41\n\n\nPerson other than the parties hereto and their respective successors and\nassigns.\n\n      SECTION 11.10. Entire Agreement. This Agreement and the Confidentiality\nAgreement constitute the entire agreement between the parties with respect to\nthe subject matter of this Agreement and supersedes all prior agreements and\nunderstandings, both oral and written, between the parties with respect to the\nsubject matter of this Agreement.\n\n      SECTION 11.11. Captions. The captions herein are included for convenience\nof reference only and shall be ignored in the construction or interpretation\nhereof.\n\n      SECTION 11.12. Severability. If any term, provision, covenant or\nrestriction of this Agreement is held by a court of competent jurisdiction or\nother authority to be invalid, void or unenforceable, the remainder of the\nterms, provisions, covenants and restrictions of this Agreement shall remain in\nfull force and effect and shall in no way be affected, impaired or invalidated\nso long as the economic or legal substance of the transactions contemplated\nhereby is not affected in any manner materially adverse to any party. Upon such\na determination, the parties shall negotiate in good faith to modify this\nAgreement so as to effect the original intent of the parties as closely as\npossible in an acceptable manner in order that the transactions contemplated\nhereby be consummated as originally contemplated to the fullest extent possible.\n\n      SECTION 11.13. Specific Performance. The parties hereto agree that\nirreparable damage would occur if any provision of this Agreement were not\nperformed in accordance with the terms hereof and that the parties shall be\nentitled, without posting a bond or similar indemnity, to an injunction or\ninjunctions to prevent breaches of this Agreement or to enforce specifically the\nperformance of the terms and provisions hereof in any federal court located in\nthe State of Delaware or any Delaware state court, in addition to any other\nremedy to which they are entitled at law or in equity.\n\n\n                                       42\n\n\n      IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be\nduly executed by their respective authorized officers as of the day and year\nfirst above written.\n\n                                    NABISCO HOLDINGS CORP.\n\n                                    By: \/s\/  James M. Kilts              \n                                        ----------------------------------------\n                                        Name:  James M. Kilts\n                                        Title: President and Chief Executive \n                                               Officer\n\n\n                                    PHILIP MORRIS COMPANIES INC.\n\n                                    By: \/s\/  Louis Camilleri             \n                                        ----------------------------------------\n                                        Name:  Louis Camilleri\n                                        Title: Senior Vice President and Chief \n                                               Financial Officer\n\n\n                                    STRIKE ACQUISITION CORP.\n\n                                    By: \/s\/  Nancy DeLisi                \n                                        ----------------------------------------\n                                        Name:  Nancy DeLisi\n                                        Title: President\n\n\n                                       43\n\n<\/pre>\n","protected":false},"template":"","meta":{"_acf_changed":false,"_stopmodifiedupdate":true,"_modified_date":"","_cloudinary_featured_overwrite":false},"corporate_contracts_companies":[8280],"corporate_contracts_industries":[9425],"corporate_contracts_types":[9622,9626],"class_list":["post-43095","corporate_contracts","type-corporate_contracts","status-publish","hentry","corporate_contracts_companies-nabisco-holdings-corp","corporate_contracts_industries-food__grains","corporate_contracts_types-planning","corporate_contracts_types-planning__merger"],"acf":[],"_links":{"self":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts\/43095","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts"}],"about":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/types\/corporate_contracts"}],"wp:attachment":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/media?parent=43095"}],"wp:term":[{"taxonomy":"corporate_contracts_companies","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_companies?post=43095"},{"taxonomy":"corporate_contracts_industries","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_industries?post=43095"},{"taxonomy":"corporate_contracts_types","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_types?post=43095"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}