SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K/A
[X ] Annual Report Pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934 [Fee Required]
For the Fiscal Year Ended December 31, 1997
or
[ ] Transition Report Pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934
Commission file number 1-12271
CARSON, INC.
(Exact name of registrant as specified in its charter)
DELAWARE 06-1428605
(State or other jurisdiction of incorporation (I.R.S. Employer Identification
or organization) Number)
64 Ross Road, Savannah Industrial Park
Savannah, Georgia 31405
(Address, including zip code, of principal executive offices)
Registrant's telephone number, including area code:(912) 651-3400
Securities Registered Pursuant to Section 12 (b) of the Act:
Title of Each Class: Name of Exchange On Which Registered:
Common Stock - Class A, $0.01 Par Value New York Stock Exchange
Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.Yes _X_ No___
Securities Registered Pursuant to Section 12 (g) of the Act: None
Indicate by check mark if disclosure of delinquent filers pursuant to Item 405
of Regulation S-K is not contained herein, and will not be contained, to the
best of registrant's knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K or any amendment to this
Form 10-K. [ ]
Aggregate market value of the voting stock held by non-affiliates of the
registrant, computed by reference to the closing price on The New York Stock
Exchange on December 31, 1997 was: $ 17,999,660
Indicate the number of shares outstanding of each of the registrant's classes,
as of the latest practicable date.
Title of Each Class: Outstanding at February 28, 1998:
Common Stock - Class A, $0.01 Par Value 5,033,248 shares
Common Stock - Class B, $0.01 Par Value 1,859,677 shares
Common Stock - Class C, $0.01 Par Value 8,127,937 shares
15,020,862 shares
Documents incorporated by reference:
Definitive Proxy Statement to be filed for the 1998 Annual Meeting of
Shareholders on May 8, 1998 -- Part III.
<PAGE>
3. Exhibits incorporated by reference or filed with this report
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
*3.1 Amended and Restated Certificate of Incorporation of Carson, Inc.
*3.2 By-laws of Carson, Inc.
***3.3 Restated Certificate of Incorporation of Carson Products Company
***3.4 By-laws of Carson Products Company
***4.1 Indenture, dated as of November 6 1997, among Carson, Inc., Carson
Products Company and Marine Midland Bank, as trustee
***4.2 Form of 103/8% Senior Subordinated Note due 2007, Series B (included as
Exhibit B to Exhibit 4.1)
*9 Voting Trust Agreement dated as of August 23, 1995, by and among Dr. Leroy
Keith, S. Garrett Stonehouse, Harrow-Lewis Corporation and Northwest
Capital, Inc.
*10.1 Employment Agreement dated as of August 23, 1995,as amended as of July
31, 1996, between Carson Products Company and Dr. Leroy Keith
*10.2 Employment Agreement dated as of July 7, 1995, as amended as of July 31,
1996, between Carson Products Company and Joyce M. Roche
*10.3 Employment Agreement dated as of June 7, 1995, as amended as of July 31,
1996, between Carson Products Company and Dennis E. Smith
*10.4 Employment Agreement dated as of June 7, 1995, as amended as of July 31,
1996, between Carson Products Company and John P. Brown, Jr.
*10.7 Employment Agreement dated as of September 1, 1995, as amended as of July
31, 1996, between Carson Products Company and Allena Lee-Brown
*10.8 Employment Agreement dated as of March 11, 1996, as amended as of July 31,
1996, between Carson Products Company and Miriam Muley
***10.9 Employment Agreement dated as of May 9, 1995, between Carson Products
Company and Robert W. Pierce
*10.10 Management Assistance Agreement dated as of August 23, 1995 between
Carson Products Company and Morningside Capital Group L.L.C.
***10.11 First Amendment dated as of October 18, 1996 to the Management
Assistance Agreement dated as of August 23, 1995 between Carson Products
Company and Morningside Capital Group L.L.C.
***10.12 Second Amendment dated as of November 6, 1996 to the Management
Assistance Agreement dated as of August 23, 1995 between Carson Products
Company and Morningside Capital Group L.L.C.
*10.13 Management Agreement dated as of June 26, 2996 between Carson Products
Company and AM Cosmetics, Inc.
***10.14 First Amendment dated as of June 1, 1997 to the Management Agreement
dated as of June 26, 1996 between Carson Products Company and AM Cosmetics,
Inc.
***10.15 Second Amendment dated as of October 6, 1997 to the Management
Agreement dated as of June 26, 1996 between Carson Products Company and AM
Cosmetics, Inc.
*10.16 Subscription Agreement dated as of June 26, 1996 between Carson Products
Company and Morningside AM Acquisition Corp.
45
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*10.17 Carson, Inc. 1996 Long-term Incentive Plan
*10.18 Carson, Inc. 1996 Non-Employee Directors Equity Incentive Program
*10.19 Subscription Agreement dated as of August 23, 1995 by and among Carson,
Inc. and Investors set forth in Schedule I
*10.20 Subscription Agreement dated as of August 23, 1995 by and among Carson,
Inc. and DNL Partners, Limited Partnership
*10.21 Subscription Agreement dated as of August 23, 1995 by and among Carson,
Inc. and Indosuez Carson Partners and Indosuez CM II, Inc.
*10.22 Subscription Agreement dated as of August 15, 1995 by and among Carson,
Inc. and the individuals (outside directors) named therein
*10.23 Subscription Agreement dated as of August 15, 1995 by and among Carson,
Inc. and the individuals (members of senior management) named therein
*10.24 Licensing Agreement dated April 7, 1994, as amended May 14, 1996, between
Carson Products Company and Carson Products Company S.A. (Proprietary)
Limited
*10.25 Distribution Agreement dated May 14, 1996 between Carson Products Company
and Carson Products Company S.A. (Proprietary) Limited
*10.26 Promissory note between Joyce Roche and Carson, Inc.
*10.27 Promissory note between John P. Brown and Carson, Inc.
*10.28 Promissory note between Dennis Smith and Carson, Inc.
*10.33 Pledge Agreement dated August 13, 1996 between John P. Brown and Carson,
Inc.
*10.34 Pledge Agreement dated August 13, 1996 between Miriam Muley and Carson,
Inc.
*10.35 Pledge Agreement dated August 13, 1996 between Joyce Roche and Carson,
Inc.
*10.36 Pledge Agreement dated August 13, 1996 between Dennis Smith and Carson,
Inc.
**10.37 Asset Purchase Agreement dated as of March 27, 1997 between Carson
Products Company and Conopco, Inc. d/b/a Chesebrough-Pond's USA Co.
**10.38 Asset Purchase Agreement dated as of March 27, 1997 between Carson
Products Company and Jean Philippe Fragrances, Inc.
**10.39 Service Agreement dated as of April 30, 1997 between Carson Products
Company and Conopco, Inc. d/b/a Chesebrough-Pond's USA Co.
**10.40 Broker Agreement dated as of September 19, 1997 between Carson Products
Company and AM Cosmetics, Inc.
***10.41 Manufacturing Agreement dated as of April 30, 1997 between Carson
Products Company and AM Cosmetics, Inc.
***10.42 Credit Agreement dated as of November 6, 1997 among Carson Products
Company, Credit Agricole Indosuez and the lenders named therein
***10.43 Term Loan and Revolving Credit Deed to Secure Debt, Assignment of
Leases and Security Agreement dated as of November 6, 1997 made by Carson
Products Company in favor of Credit Agricole Indosuez
***10.44 Borrower General Security Agreement dated as of November 6, 1997 made
by Carson Products Company in favor of Credit Agricole Indosuez
***10.45 Borrower Intellectual Property Security Agreement dated as of November
6, 1997 made by Carson Products Company in favor of Credit Agricole
Indosuez
***10.46 Borrower Securities Pledge Agreement dated as of November 6, 1997 made
by Carson Products Company in favor of Credit Agricole Indosuez
***10.47 Holdings Securities Pledge Agreement dated as of November 6, 1997 made
by Carson, Inc. In favor of Credit Agricole Indosuez
10.48 Employment Agreement dated as of July 14, 1997, between Carson Products
Company and Richard A. Bozzell
10.49 Employment Agreement dated as of September 8, 1997, between Carson
Products Company and Donald Riley
10.50 Promissory note between Miriam Muley and Carson, Inc.
+10.51 Asset Purchase Agreement dated as of December 11, 1997 between Carson
Products(Proprietary) Limited, A&J Cosmetics (Proprietary) and Allan
Townsend.
***12.1 Statement re Computation of Ratio of Earnings to Fixed Charges
*16 Letter regarding Change in Certifying Accountant from Price Waterhouse LLP
***18 Letter re Change in Accounting Principles, dated August 11, 1997 from
Deloitte & Touche LLP to Carson, Inc., incorporated herein by reference to
Carson, Inc.'s Quarterly Report on Form 10-Q of the quarter ended June 30,
1997, as amended
***21.1 Subsidiaries of Carson, Inc.
23.2 Consent of Deloitte & Touche LLP
***24.1 Powers of Attorney (included on signature pages of this Annual Report on
Form 10-K)
27 Financial Data Schedule
* Incorporated herein by reference to the Registrant's Registration Statement on
Form S-1 filed with the Securities and Exchange Commission on October 14, 1996
File No. 333-10191 and the amendments thereto.
** Incorporated herein by reference to Carson, Inc.'s Current Report on Form 8-K
as of May 15, 1997, as amended by Form 8-KA dated July 14, 1997, July 16, 1997
and October 9, 1997.
*** Incorporated herein by reference to the Registrant's Registration Statement
on Form S-4 filed with the Securities and Exchange Commission on October 31,
1997 File No. 333-42831.
+ Portions of such exhibit have been excluded pursuant to a request for
confidential treatment. Such material has been filed separately with the
Securities and Exchange Commission on the date hereof.
46
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registration has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
CARSON, INC.
Date: April 17, 1998 By: /s/ Robert W. Pierce
Robert W. Pierce
Executive Vice President and Chief
Financial Officer(Principal
Accounting and Financial Officer)
48
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AGREEMENT
entered into between
CARSON PRODUCTS (PROPRIETARY) LIMITED
(Registration No. 93/02698107)
and
A & J COSMETICS (PROPRIETARY) LIMITED
(Registration No. 97/02712/07)
and
ALLAN TOWNSEND
(Identity No. 490313 5089 00 2)
1
<PAGE>
TABLE OF CONTENTS
CLAUSE DESCRIPTION PAGE
No.
1. INTERPRETATION AND PRELIMINARY.............................1
2. RESOLUTIVE CONDITION.......................................6
3. MANAGEMENT CONTROL.........................................7
4. SALE OF THE BUSINESS.......................................8
5. PURCHASE PRICE.............................................9
6. PAYMENT OF THE PURCHASE PRICE..............................9
7. CALCULATION OF THE ADJUSTMENT AMOUNT......................10
8. PURCHASER'S GUARANTEE.....................................13
9. STOCKTAKING...............................................14
10. EMPLOYEES.................................................14
11. SECTION 34 ADVERTISEMENT..................................15
12. DELIVERY..................................................15
13. THE DEBTS.................................................16
14. WARRANTIES................................................16
15. AGREEMENTS OF LEASE.......................................18
16. TOWNSEND SERVICE AGREEMENT................................18
17. DEED OF SURETYSHIP........................................18
18. INDEMNITY.................................................18
19. PRODUCT RETURNS...........................................19
20. TRADE MARKS AND PRODUCT FORMULATIONS......................19
21. RESTRAINT.................................................19
22. AGENT'S COMMISSION........................................22
23. PRESS ANNOUNCEMENTS.......................................22
24. THE KNOW-HOW..............................................22
25. CONFIDENTIAL INFORMATION..................................22
26. DOMICILIUM CITANDI ET EXECUTANDI..........................23
27. BREACH....................................................24
28. WHOLE AGREEMENT, NO AMENDMENT.............................25
29. COSTS.....................................................25
30. VALUE-ADDED TAX...........................................25
31. JOINT AND SEVERAL LIABILITY OF TOWNSEND AND THE SELLER....26
ANNEXURE A - DESIGNATED FIXED ASSETS
ANNEXURE B - PRODUCTS
ANNEXURE C - PRODUCT FORMULATIONS
ANNEXURE D - INDICITIVE INCOME STATEMENTS REFLECTING PROFITS
ANNEXURE E - TRADEMARKS
ANNEXURE F - SALES AND PROFIT BUDGET
ANNEXURE G - SPECIFIED EMPLOYEES
ANNEXURE~H - TERMS OF HIRE OF LEASE PREMISES
ANNEXURE~I - TOWNSEND SERVICE AGREEMENT
i
<PAGE>
WHEREBY IT IS AGREED AS FOLLOWS
1. INTERPRETATION AND PRELIMINARY
The headings of the clauses in this agreement are for the purpose of convenience
and reference only and shall not be used in the interpretation of nor modify nor
amplify the terms of this agreement nor any clause hereof. Unless a contrary
intention clearly appears~-
1.1. words importing -
1.1.1. any one gender include the other two genders;
1.1.2. the singular include the plural and vice versa; and
1.1.3. natural persons include created entities incorporate or
unincorporate) and the state and vice versa;
1.2. the following terms shall have the meanings assigned to them hereunder
and cognate expressions shall have corresponding meanings, namely -
1.2.1. "ad valorem" means, in the context of the calculation of profits in
terms of the agreement, the ad valorem as calculated on the value of invoice
sales;
1.2.2. "the Act" means the Companies Act 61 of 1973;
1.2.3. "adjustment amount" means the amount to be calculated in terms of
clause 7 below;
1.2.4. "business" means the business of the manufacture, marketing
distribution of the products, presently conducted by the seller under the name,
as more fully described in clause 4;
1.2.5. "debts" means the claims against trade debtors in respect of the
business on the effective date;
1.2.6. "designated date" means the date of issue by the purchaser's
auditors of the specified certificate referred to in clause 2.2 below which
reflects the fulfillment of the resolutive condition;
1.2.7. "designated fixed assets" means those fixed assets reflected in
Annexure A hereto;
1.2.8. "effective date" means 27 October 1997;
1.2.9. "fixed assets" means all plant, equipment and the fixed assets used
in connection with and comprising part of the business including at least the
designated fixed assets;
1.2.10. "invoiced sales" means the invoiced sales of products after
deducting (to the extent that they may have been included in aforegoing) trade
and cash discounts, ad valorem duties, value-added tax or any refunds made in
respect of products;
1.2.11. "know-how" means the know-how relating to the manufacturing of the
products and the product formulations;
1.2.12. "premises" means the leased premises at which the business is
carried on, being the factory premises situate at 86 Wolhuter Street, Jeppe,
Johannesburg;
1.2.13. "prime rate" means the basic rate of interest per annum publicly
quoted by THE STANDARD BANK OF SOUTH AFRICA LIMITED ("the Bank") as the rate at
which the Bank lends on overdraft, compounded monthly in arrears, and calculated
on a 365 (three hundred and sixty five) day year factor, irrespective of whether
or not the year is a leap year, as reflected in a certificate issued by a
manager of the Bank (whose appointment and authority shall not be necessary to
prove);
1.2.14. "products" means the toiletry products as more fully described in
Annexure~B;
1.2.15. "product formulations" means the formulations and methods for the
manufacture of the products, certain of which are more fully described in
Annexure~C;
1.2.16. "profits" means :-
a) in respect of clause 2 below, the net profits of the business during
the specified period after deduction of all costs and expenses and
after deducting therefrom tax at an imputed rate equal to the standard
rate of taxation applicable to companies as at 31 December 1997 as
prescribed pursuant to the provisions of the Income Tax Act (58 of
1962, as amended), provided that - * depreciation over the specified
period shall be effected at an agreed value of R20 500,00 (twenty
thousand five hundred rand) per month; and * no expenses attributable
to the sale of the business of whatsoever nature (whether direct or
indirect) shall be categorised as an expense of the business over the
specified period and any such expenditure shall be ignored for the
purposes of the profit calculation;
b) in the context of clause 7, the net profits of the business during the
adjustment period after deduction of all costs and expenses and after
deducting therefrom tax at an imputed rate equal to the standard rate
of taxation applicable to companies as at 31 December 1998 as
prescribed pursuant to the Income Tax Act (58 of 1962, as amended) to
be calculated subject to the provisions of clause 7.5.3 below.
Attached hereto marked Annexure D are indicative income statements
reflecting the factors to be taken into account in determining profits
of the purposes of this agreement;
1.2.17. "purchaser" means CARSON PRODUCTS (PROPRIETARY) LIMITED;
1.2.18. "resolutive condition" means the resolutive condition contemplated
in clause 2 below;
1.2.19. "seller" means A & J COSMETICS (PROPRIETARY) LIMITED;
1.2.20. "specified period" means the period commencing on the effective
date and ending on 31 December 1997 (both days inclusive);
1.2.21. "stock" means finished stock, work-in-progress and raw materials on
hand in respect of the business as at the effective date including
stock-in-transit and including any slow moving, damaged or unsaleable stock;
1.2.22. "sundry assets" means packaging, stationery, brochures, stocks of
sundry tools and like items, consumables and the like on hand in respect of the
business as at the effective date;
1.2.23. "TOWNSEND" means ALLAN TOWNSEND;
1.2.24. "trade marks" means the trade marks and other intellectual property
as registered or pending registration pertaining to the business and/or the
products as more fully detailed in Annexure E;
1.3. any reference in this agreement to "date of signature hereof" shall be
read as meaning a reference to the date of the last signature of this agreement;
1.4. any reference to an enactment is to that enactment as at the date of
signature hereof and as amended or re-enacted from time to time;
1.5. if any provision in a definition is a substantive provision conferring
rights or imposing obligations on any party, notwithstanding that it is only in
the definition clause, effect shall be given to it as if it were a substantive
provision in the body of the agreement;
1.6. when any number of days is prescribed in this agreement, same shall be
reckoned exclusively of the first and inclusively of the last day unless the
last day falls on a Saturday, Sunday or public holiday, in which case the last
day shall be the next succeeding day which is not a Saturday, Sunday or public
holiday;
1.7. where figures are referred to in numerals and in words, if there is
any conflict between the two, the words shall prevail;
1.8. where any term is defined within the context of any particular clause
in this agreement, the term so defined, unless it is clear from the clause in
question that the term so defined has limited application to the relevant
clause, shall bear the meaning ascribed to it for all purposes in terms of this
agreement, notwithstanding that that term has not been defined in this
interpretation clause;
1.9. the expiration or termination of this agreement shall not affect such
of the provisions of this agreement as expressly provide that they will operate
after any such expiration or termination or which of necessity must continue to
have effect after such expiration or termination, notwithstanding that the
clauses themselves do not expressly provide for this.
2. RESOLUTIVE CONDITION
2.1. This agreement is subject to the following resolutive condition,
namely, that a certificate is issued by the purchaser's auditors in terms of
clause 2.2 below which reflects that either :-
2.1.1. the profits derived from the business during the specified period
was less than R475 000,00 (four hundred and seventy five thousand rand); or
2.1.2. the gross profit of the business as a percentage of invoiced sales
during the specified period was less than 33.5% (thirty three point five per
cent).
2.2. Forthwith after 31 December 1997 but by no later than 20 January 1998,
the purchaser's auditors shall prepare a certificate reflecting :-
2.2.1. the profits of the business during the specified period;
2.2.2. the gross margin on invoiced sales of the business derived during
the specified period, (referred to herein as the "specified certificate"). In
preparing the specified certificate the purchaser's auditors shall act as
experts and not as arbitrators and their decision shall, in the absence of
manifest error, be final and binding on the parties.
2.3. If the specified certificate should reveal either that the profits of
the business during the specified period were less than R475 000,00 (four
hundred and seventy five thousand rand) or that the gross margin on invoiced
sales of the business derived during the specified period was less than 33.5%
(thirty three point five per cent), then (unless the purchaser elects to waive
the fulfillment of the resolutive condition, which it shall be entitled to do by
furnishing written notice to such effect to the seller within 7 (seven) days of
receipt of the specified certificate), the resolutive condition will be deemed
to have been fulfilled and, with effect from the date of issue of the specified
certificate, the provisions of this agreement shall ipso facto terminate and the
purchaser shall deliver to the seller at the seller's cost the business on the
basis that the business will be taken by the seller voetstoots in its then
condition and save as aforesaid and subject to the provisions of clause 3.2,
there shall be no further restitution consequent upon the non-fulfillment of the
resolutive condition.
Without detracting from the generality from the aforesaid provisions,
should the resolutive condition be fulfilled, :- the purchaser shall be deemed
to have receded all of its rights, title and interest in and to the trade marks
to the seller and hereby appoints the seller as its attorney and agent in rem
suam to do all such things and sign all such forms and documentation as may be
necessary to effect the re-cession of the trade marks to the seller; and neither
the seller nor TOWNSEND will be bound by the restraint of trade provisions
contemplated in clause 21 below; the confidentiality provisions contemplated in
clause 25 shall continue to be of full force and effect.
3. MANAGEMENT CONTROL
3.1. On the effective date, the purchaser shall be entitled to assume
control of the management of the business and shall act or omit to act in regard
to the business in such manner as may be mutually agreed to as between the
purchaser and TOWNSEND, provided that the business shall be conducted in the
usual manner for business of this type. No joint venture shall come into force
between the seller and the purchaser concerning the business.
3.2. If the resolutive condition is fulfilled and accordingly this
agreement ceases retrospectively to be of force or effect, then :-
3.2.1. the seller shall resume control of the business immediately after
the designated date and the purchaser shall be deemed to have conducted the
business as between the effective date to the designated date as the agent of
the seller;
3.2.2. as soon as practicable after the designated date, an adjustment
account shall be prepared by the purchaser auditors (on the instructions of
either the purchaser or the seller) relating to the conduct of the business from
the date of assumption of control to the designated date as well as in respect
of any prepayments made by the purchaser in respect of the business for the
periods after the designated date (the "adjustment account").
The purpose of the adjustment account shall be to determine the amount, if
any, payable by the purchaser to the seller (or vice versa) so as for all
intents and purposes to place the seller and the purchaser in the same financial
position as they would have been in had this agreement never been entered into.
The auditors' fees for the preparation of the adjustment account shall be borne
by the purchaser and the seller in equal shares. Payment in terms of the
adjustment account together with interest at the prime rate, calculated from the
effective date shall become due and payable within 7 (seven) days after it has
been prepared. To the extent that the purchaser incurs any liability (whether
for taxation or otherwise) in respect of the conduct of the business as between
the effective date and the date of fulfillment of the resolutive condition, the
seller indemnifies the purchaser against any loss or liability which the
purchaser may suffer as a result of or which may be attributable to the conduct
by the purchaser of the business during the aforesaid period.
4. SALE OF THE BUSINESS
The seller sells, transfers and cedes to the purchaser as an indivisible
whole and as a going concern with effect from the effective date from which date
the risk in and benefits of the business shall vest in the purchaser, the
business comprising -
4.1. the goodwill thereof;
4.2. the fixed assets;
4.3. the stock;
4.4. the product formulations;
4.5. the sundry assets;
4.6. the trade marks and any other trade marks (expressly excluding the
trade mark of Startline), designs and logos, if any, used in the conduct of the
business as well as the underlying inventions relating to any patents;
4.7. all contracts of the business concluded in the ordinary course of
business, including orders relating to stock undelivered as at the effective
date,
but excluding -
4.8. any liabilities (other than the liabilities contemplated in clause
12.1 in respect of the contracts);
4.9. the debts;
4.10. all cash on hand or credit balances at banks in respect of the
business.
5. PURCHASE PRICE
5.1. The purchase price of the business shall, subject to the adjustment
provisions set out in clause 7 below, be R53 500 000,00 (fifty three million
five hundred thousand rand).
5.2. The purchase price of the business shall be allocated as follows -
5.2.1. the fixed assets, at the book value thereof;
5.2.2. sundry assets, at the book value thereof;
5.2.3. the stock, at the cost thereof;
5.2.4. goodwill, R1,00 (one rand);
5.2.5. the balance in respect of the trade marks.
6. PAYMENT OF THE PURCHASE PRICE
6.1. The purchase price shall be payable by the purchaser to the seller as
follows :-
6.1.1. R26 500 000,00 (twenty six million five hundred thousand rand) on 31
January 1998;
6.1.2. R20 000 000,00 (twenty million rand) on or before 3 January 1999;
6.1.3. R7 000 000,00 (seven million rand), subject to any adjustment to be
effected to the purchase price in terms of the provisions of clause 7 below. The
parties shall use their best endeavours to procure that the adjustment amount be
finalised by no later than 31 March 1999. The purchaser undertakes to pay the
adjustment amount to the seller by no later than 31 March 1999.
6.2. Save as provided for in clause 6.3, no interest shall on the
outstanding balance of the purchase price from time to time.
6.3. Save as expressly provided to the contrary in this agreement,
discharge of the purchase price shall be effected without deduction, set off,
commission and/or the like in the manner more fully contemplated in clause 6.4.
All payments not effected on due date will attract interest at the prime rate
from due date of payment to date of payment in full.
6.4. All payments to be effected by the purchaser to the seller in terms of
this agreement shall be made by way of electronic bank transfer into the
seller's following NEDBANK bank account, namely :-
Account Holder: A H TOWNSEND
Account Number: 1962 241351
Branch: John Page Drive
Branch Code: 19620526.
6.5. The discharge by the purchaser of the purchase price to the seller in
the manner contemplated in clause 6.4 shall constitute the full and complete
discharge of the purchase price to the seller and TOWNSEND indemnifies the
purchaser accordingly.
7. CALCULATION OF THE ADJUSTMENT AMOUNT
7.1. The purchase price of the business has been determined and agreed on
the following basis :-
7.1.1. the profits (as calculated in terms of clauses 7.2, 7.3, 7.4 and 7.5
below) of the business (which shall constitute a division of the purchaser)
during the period 1 January 1998 to 31 December 1998 (the "adjustment period")
shall be R5 000 000,00 (five million rand);
7.1.2. to the extent that -
7.1.2.1. the profits of the business during the adjustment period are a
greater than R5 000 000,00 (five million rand) then, for each complete R100
000,00 (one hundred thousand rand) that the profits during the adjustment period
exceed R5 000 000,00 (five million rand), the purchase price shall be increased
by an amount of R500 000,00 (five hundred thousand rand), provided that the
maximum amount by which the purchase price will be increased will,
notwithstanding the actua profits of the business during the adjustment period,
be limited to R11 000 000,00 (eleven million rand) (i.e. a purchase
consideration of R64 500 000,00 (sixty four million five hundred thousand rand);
7.1.2.2. the profits of the business during the adjustment period are less
than R5 000 000,00 (five million rand) then, for each complete R100 000,00 (one
hundred thousand rand) that the profits during the adjustment period are less
than R5~000~000,00 (five million rand), the purchase price shall be reduced by
an amount of R400~000,00 (four hundred thousand rand), provided that the maximum
amount by which the purchase price will be reduced will, notwithstanding the
actual profits of the business during the adjustment period, be limited to
R7~000~000,00 (seven million rand) (i.e. a purchase consideration of
R46~500~000,00 (forty six million five hundred thousand rand).
7.2. The adjustment amount shall be calculated by the purchaser's auditors
and the seller's auditors acting jointly and, failing agreement between them, by
an independent auditor appointed jointly by the purchaser's auditors and the
seller's auditors and, failing agreement between them, appointed by the Chairman
for time being, of the Transvaal society of Chartered Accountants (or its
successor body). Such auditors in resolving the dispute shall act as experts and
not as arbitrators and their decision shall be final and binding on the parties
and they shall determine the parties' liability for their charges. If any
determination is manifestly unjust, that the court exercises its general power,
if any, to correct such determination, the parties shall be bound thereby.
7.3. The seller and the purchaser agree that :-
7.3.1. separate divisional accounts in respect of the business (which shall
constitute the "A&J Division" of the purchaser) shall be maintained for the
adjustment period;
7.3.2. the A&J Division shall be divided into the following 2 (two)
sub-divisions, namely -
7.3.2.1. the non-chain store division;
7.3.2.2. the chain store division;
7.3.3. no expenses attributable to the sale of the business of whatsoever
nature (whether direct or indirect) shall be taken into account as expenses of
the business over the adjustment period and such expenditure shall be ignored
for the purposes of the profit calculation.
7.4. In regard to the non-chain store sub-division :-
7.4.1. same shall be managed by TOWNSEND under the supervision and overall
control of the board of the purchaser;
7.4.2. same will be operated in accordance with the non-binding budget
approved of by the purchaser and TOWNSEND, a copy of which is attached marked
Annexure F;
7.4.3. the profits shall be calculated applying generally accepted
accounting principles, provided that -
7.4.3.1. in calculating the profits, there shall be deducted therefrom tax
at an imputed tax rate equal to the standard rate of taxation applicable to
companies as at 31 December 1998 as prescribed pursuant to the provisions of the
Income Tax Act (58 of 1962, as amended);
7.4.3.2. the maximum amount of depreciation (whether of trade marks,
fixtures, fittings or any other assets) to be applied shall, notwithstanding the
actual depreciation of the aforesaid assets, be deemed to be R2 000 000,00 (two
million rand);
7.4.3.3. to the extent that interest expense exceeds o R174 000,00 (one
hundred and seventy four thousand rand), the interest expense shall be deemed to
be R174 000,00 (one hundred and seventy four thousand rand).
7.5. In regard to the chain store sub-division :-
7.5.1. same shall be managed by the purchaser;
7.5.2. same will be operated in accordance with the non-binding sales and
or fit a budget attached hereto marked Annexure F;
7.5.3. the profits of the sub-division shall be calculated applying
generally accepted accounting principles provided that, to the extent that -
7.5.3.1. advertising expenditure exceeds R1 000 000,00 (one million rand),
the advertising expenditure of the products shall be deemed to be R1 000 000,00
(one million rand);
7.5.3.2. cash settlement discounts exceed 2% (two per cent) of invoiced
sales to chain stores, the cash settlement discount shall be deemed to equal 2%
(two per cent) of invoiced sales to chain stores;
7.5.3.3. trade promotion expenditure exceeds 3 % (three per cent) of
invoiced sales, the trade promotion expenditure shall be deemed to be 3% (three
per cent) of invoiced sales;
7.5.3.4. rebates exceed 5 % (five per cent) of invoiced sales, the rebates
shall be deemed to equal 5 % (five per cent) of invoiced sales;
7.5.3.5. selling, distribution and merchandising costs exceed 9% (nine per
cent) of invoiced sales, such selling, distribution and merchandising cost shall
be deemed to equal 9% (nine per cent) of the invoiced sales;
7.5.3.6. collection and delivery costs exceed 1% (one per cent) of invoiced
sales, such collection and delivery costs shall be deemed to equal 1% (one per
cent) of invoiced sales.
Save as otherwise hereinbefore set out, in calculating the profits of this
sub-division, the balance of the expenses shall be fixed as set out in Annexure
F.
7.6. To the extent that products are manufactured by the purchaser's
subsidiary CARSON PRODUCTS WEST AFRICA ("WEST AFRICA") at any time prior to 31
December 1998, there shall be included in the profits of the business a notional
profit equal to 8% (eight per cent) of the invoiced sales of products
manufactured by WEST AFRICA.
7.7. To the extent that the attributable profits for the 2 (two) month
period commencing on the effective date and ending 31 December 1997 (both days
inclusive) exceeds R525 000,00 (five hundred and twenty five thousand rand), the
increment will be carried forward and be deemed to constitute part of the
profits derived by the A&J Division during the adjustment period.
8. PURCHASER'S GUARANTEE
8.1. As security for the obligations of the purchaser to the seller for the
discharge of the minimum purchase price payable by the purchaser to the seller
in terms of this agreement, the purchaser shall, on 14 November 1997, deliver to
the seller the following guarantees issued by THE STANDARD BANK OF SOUTH AFRICA
LIMITED ("STANDARD BANK"), namely :-
8.1.1. a guarantee for the payment, subject to the non-fulfillment of the
resolutive condition, of R26 500 000,00 (twenty six million five hundred
thousand rand) to be paid by no later than 31 January 1998;
8.1.2. a guarantee for the payment, subject to the non-fulfillment of the
resolutive condition, of R20 000 000,00 (twenty million rand) to be paid by no
later than 3 January 1999.
8.2. CARSON HOLDINGS LIMITED ("CHL"), by its signature hereto, binds itself
as surety and co-principal debtor in solidum with the purchaser for the due
discharge by the purchaser of its obligations, if any, in respect of an
additional R18~000~000,00 (eighteen million rand) of the purchase price of the
business which may become payable by the purchaser to the seller pursuant to the
provisions of clause 7 above (and in particular, clause 7.1.2.1). CHL hereby
renounces all benefits arising from the legal exceptions "non numeratae
pecuniae", "non causa debit", "errore calcul" and "beneficia excussionis et
divisionis", with the force and effect of which CHL hereby declares itself to be
fully acquainted.
9. STOCKTAKING
9.1. It is recorded that the parties caused the stock to be taken in
accordance with the following provisions -
9.1.1. the stocktaking took take place on 25 October 1997 (the "stocktaking
date");
9.1.2. each of the parties was present or represented at the stocktaking;
9.1.3. after the stocktaking was completed, schedules reflecting the
stocktaking were prepared and initialled by the parties.
9.2. The seller warrants that the saleable, undamaged finished stock
reflected in the stocktaking schedules will have a value of not less than R3 700
000,00 (three million seven hundred thousand rand).
10. EMPLOYEES
10.1. The parties agree that the purchaser shall, notwithstanding anything
to the contrary contained in sl 97 of the Labour Relations Act, 1995, only be
obliged to offer employment to those employees of the seller whose names and
salaries appear in Annexure G (the "specified employees"), with effect from the
effective date, on terms which taken on an overall basis but not on an item by
item comparison are no less favourable to the specified employees.
10.2. The seller has agreed to retrench all employees of the business other
than the specified employees and those specified employees who do not accept
offers of employment by the purchaser at the effective date. Any amounts payable
to non-specified employees or specified employees who do not accept employment
by the purchaser shall be for the account of the seller. The seller hereby
indemnifies and holds harmless the purchaser against any claim, loss or damage
or demand which may be made against the purchaser by any of the employees of the
business as a consequence or flowing from the provisions of sl 97 of the Labour
Relations Act, 1995, including any amount which the purchaser may be ordered to
pay by the Labour Court or by any other competent juridical authority.
10.3. All and any claims of whatsoever nature, if any, of the specified
employees who accept employment with the purchaser, which relate to any period
prior to the date upon which they became employees of the purchaser or arising
out of or related to the termination of their employment by the seller,
including without limitation any claim in respect of any alleged unfair labour
practice or unfair dismissal or its equivalent, shall be for the account of the
seller which indemnifies the purchase against any liability the purchaser may
incur or loss the purchaser may suffer (including legal costs on an attorney and
client scale incurred in defending any legal or other proceedings instituted
against the purchaser). Without derogating from the generality of the
aforegoing, the seller confirms that all leave and/or holiday pay accrued by
salaried staff up to 1 November 1997 and for waged staff accrued up to 31
December 1997 will have to be taken or paid in full by 12 January 1998. Any or
all outstanding claims in regard to leave and/or holiday pay shall be for the
sole account of the seller, which indemnifies the purchaser accordingly.
10.4. As regards specified employees who are members of the seller's
provident fund, the seller undertakes to procure that the actuaries of the
provident fund shall, as soon as is reasonably possible but in any event by no
later than 6 (six) months from the effective date, determine in respect of each
of the provident fund members their fund credit. The aggregate of the provident
members' fund credits as confirmed by the fund's actuary shall, together with
all contributions, income and expenditures from the effective date to the date
of transfer, be transferred to a fund nominated by the Purchaser.
11. SECTION 34 ADVERTISEMENT
The purchaser agrees that the transaction shall not be advertised as
contemplated in terms of section 34 of the Insolvency Act, 1936. In
consideration for the purchaser agreeing to this, TOWNSEND hereby indemnifies
the purchaser against any loss or damage of whatsoever nature which may be
sustained or incurred by the purchaser as a result of the provisions of section
34 of the Insolvency Act, 1936 being invoked by any creditor of the seller.
12. DELIVERY
The business shall be delivered to the purchaser on the effective date
(against payment of the relevant portion of the purchase price) from which date
the purchaser shall take legal possession of the business. Delivery shall
include -
12.1. the assignment (with effect from the effective date) of the seller's
rights and prospective obligations in respect of the contracts contemplated in
clause 4.7, to the extent that the other parties to such contracts consent
thereto. The seller undertakes to use its best endeavours to procure the
assignment of the contracts to the purchaser. To the extent that the other
parties to the contracts do not consent to such assignment -
12.1.1. the purchaser shall be entitled as between it and the seller to the
benefit of and shall bear the risk of such contracts from the effective date and
the seller shall bear the risk and be entitled to the benefit of such contracts
prior to the effective date;
12.1.2. the purchaser shall be obliged at its cost but in the seller's name
to discharge the seller's obligations under the contracts after the effective
date;
12.1.3. the parties respectively indemnify each other against any loss of
any nature which may arise as a result of the other of them failing to comply
with its obligations hereunder;
12.2. the affording to the purchaser of access to the seller's documents,
books and records and all information relating to the business;
12.3. the physical delivery of all assets forming part of the business to
the purchaser by handing them to the purchaser;
12.4. insofar as vehicles are concerned, all necessary license papers and
transfer documents, but on the basis that the purchaser shall obtain roadworthy
certificates if necessary;
12.5. the cession of any restraint of trade given to the seller in respect
of the business, to the purchaser.
13. THE DEBTS
13.1. It is recorded that the debts are not included in the assets being
acquired by the purchaser from the seller in terms of this agreement.
13.2. The seller shall be entirely responsible for the recovery of all such
debts. In the event that any of the debts is paid to the purchaser, the
purchaser shall promptly pay such amount over to the seller.
13.3. In the event of the seller receiving any payments of any amount due
to the business in respect of any products delivered on or after the effective
date, the seller shall promptly pay such amount over to the purchaser.
14. WARRANTIES
14.1. The seller warrants that -
14.1.1. the fixed assets and the trade marks are beneficially owned by the
seller which will be able to give free and unencumbered title thereof as well as
of any current assets sold, to the purchaser on the implementation date;
14.1.2. the fixed assets, the stock and any other current assets sold to
the purchaser in terms of this agreement shall, at the effective date and on the
implementation date, be paid up in full and not subject to any lien or
encumbrance of any nature whatsoever;
14.1.3. the designated fixed assets will be delivered to the purchaser on
the effective date without any of such assets missing;
14.1.4. between 1 October 1997 and the effective date, the seller will not
have entered into any transaction or acquired or disposed of any assets or
incurred any liabilities, otherwise than in the normal, ordinary and regular
course of business, nor will it have increased the salaries of the specified
employees during that period other than normal or merit increases determined in
the normal course and no events will have taken place which have or will have
had the effect of impairing the goodwill of the business;
14.1.5. all products which have been manufactured and/or sold by the seller
in respect of the business have been manufactured and/or sold in compliance with
the requirements of all competent authorities, if any;
14.1.6. the seller is not in default of any material obligation affecting
the business, whether under the contracts contemplated in clause 4.7 or under
any legislation or (without limitation eiusdem generis) otherwise;
14.1.7. the seller has disclosed to the purchaser all facts and
circumstances material to this transaction and which are or would be material to
an independent purchaser of the business;
14.1.8. all fixtures, fittings, furniture, plant and equipment as well as
any other assets comprising the business will be in the same condition and good
order as the condition and order of the relevant assets at the time of
inspection thereof by the purchaser during October 1997;
14.1.9. the working environment for the employees of the business is safe
and without risk to health;
14.1.10. the systems of work, plant and machinery utilized in the conduct
of the business are, as far as is reasonably practicable, safe and without risk
to health;
14.1.11. the seller has complied with all its obligations as an employer as
contemplated in the Occupational Safety and Health Act, 1993.
14.2. TOWNSEND warrants that no application for the winding up of the
seller has been presented at date of signature hereof nor will any such
application have been presented on the effective date.
14.3. The seller indemnifies and holds the purchaser harmless against any
loss, liability, damage or expense which the purchaser or the business may
suffer or sustain as a result of or which may be attributable to any breach by
the seller of any of the warranties set out in clause 14.1 above or should any
of the said warranties prove to be incorrect.
14.4. Nothing herein contained shall relieve the seller from its obligation
to make those disclosures which it is in law obliged to make.
14.5. No warranties or representations which are not set forth in this
agreement shall be binding on the seller and the business is purchased on the
basis that it is taken voetstoots.
15. AGREEMENTS OF LEASE
Simultaneously with the execution of this agreement, TOWNSEND and the
seller shall procure that the landlords in respect of the premises enter into
agreements of lease with the purchaser (which hereby undertakes to enter into
such agreements of lease) on the terms set out in Annexure H.
16. TOWNSEND SERVICE AGREEMENT
Simultaneously with the execution of this agreement, TOWNSEND and the
purchaser undertake to enter into the a service agreement on the terms set out
in Annexure I.
17. DEED OF SURETYSHIP
17.1. TOWNSEND, by his signature hereto, binds himself as surety and
co-principal debtor in solidum with the seller for the due and punctual
fulfillment and performance by the seller of all obligations which the seller
may now have or have incurred and from time to time hereinafter have or incur to
the purchaser arising out of, pursuant to or as contemplated in this agreement.
17.2. TOWNSEND hereby renounces all benefits arising from the legal
exceptions "non numeratae pecuniae", "non causa debiti", "errore calcul" and
"beneficia excussionis et divisionis", with the force and effect of which
TOWNSEND hereby declares himself to be fully acquainted.
18. INDEMNITY
The seller indemnifies the purchaser against any claims, which may be made
in respect of finished products and work-in-progress which are included in the
stock forming part of the business. Should any claims be made against the
purchaser in respect of such stock, the purchaser shall afford the seller an
opportunity to assist the purchaser to contest the claim and, subject to an
indemnity in a form acceptable to the purchaser against costs being given by the
seller, shall engage attorneys and counsel nominated by the seller for the said
purpose.
19. PRODUCT RETURNS
The purchaser undertakes to accept the return to it of products dispatched
by seller prior to the effective date, provided that such products are returned
to the business in the ordinary and normal course having regard to the past
practices developed by the seller and the customers concerned in respect of the
products sold by the business. Any products returned and replaced by the
purchaser or in respect of which the purchaser affords the customer a credit
shall be taken into account in determining the profits of the business during
the adjustment period as contemplated in clause 7 above.
20. TRADE MARKS AND PRODUCT FORMULATIONS
20.1. The seller hereby assigns to the purchaser all right, title and
interest in and to the recipes and product formulations relating to the
products, and shall reduce same to writing and deliver same to the purchaser on
the effective date.
20.2. The seller hereby warrants that it is the sole owner of the trade
marks and of the product formulations and is free to assign and transfer them to
the purchaser.
20.3. The seller undertakes to sign all documents and do all things
reasonably necessary to record and effect the assignment of the trade marks in
the relevant registration office in all those countries where such trade marks
have been registered or applied for.
20.4. All costs incurred in effecting the assignment of the trade marks and
trade mark applications shall be borne by the purchaser.
20.5. It is recorded that the seller has disclosed to the purchaser that in
terms of a license agreement with SMITH KLINE BEECHAM, the sale of "Blue Ice"
products is restricted to the wholesale trade only and that sales of "Blue Ice"
products to chain stores is prohibited.
21. RESTRAINT
21.1. In this clause, unless clearly inconsistent with the context, words
and phrases defined hereunder shall bear the meanings assigned to them in this
sub-clause -
21.1.1. "competitive activity" shall mean the manufacture, marketing, sale
and distribution of products or products which may be manufactured, marketed,
sold or distributed in competition with the products;
21.1.2. "the restraint period" shall mean a period of 4 (four) years from
the effective date;
21.1.3. "territory" shall mean the continent of Africa including (without
limitation) Mauritius;
21.2. Subject to clause 21.7 below, the seller hereby undertakes to the
purchaser that it will not, either alone or jointly -
21.2.1. during any part of the restraint period, whether as proprietor,
partner, director, shareholder, employee, member, consultant, contractor,
financier, agent, representative, assistant or otherwise, and whether for reward
or not, directly or indirectly, -
21.2.1.1. carry on in the territory any undertaking; or
21.2.1.2. be interested or engaged in or concerned with any company, close
corporation, firm, undertaking or concern operating in any part of the
territory; or
21.2.1.3. be employed by any company, close corporation, firm, undertaking
or concern operating in any part of the territory in a competitive activity;
21.2.2. during any part of the restraint period and thereafter, to the
extent that the same are protected by law, disclose any trade secrets and/or
confidential information of the business other than to persons connected with
the business and who are required to know such secrets or to have such
confidential information. Trade secrets and confidential information shall
include (but not be limited to) all and whatever information relating to the
business and its suppliers and customer which is not readily available in the
ordinary course of business to its competitors, provided that nothing herein
contained shall prohibit the seller from entering into any joint ventures with
persons who are concerned in competitive activities in the territory, provided
that the subject matter of the joint venture is not a competitive activity in
the territory.
21.3. The seller acknowledges and agrees that -
21.3.1. the restraints imposed upon it in terms of this clause (interpreted
initially in their widest sense as provided in clause 21.3.3) are reasonable as
to subject matter, period and territorial limitation and are not more than
reasonably and necessarily required by the purchaser to maintain the goodwill
of, and its legitimate business interests in respect of the business;
21.3.2. the provisions of clauses 21.2 and 21.3.1 shall be construed as
imposing separate, severable and independent restraints in respect of -
21.3.2.1. each of the months falling within the restraint period;
21.3.2.2. each magisterial district falling within the territory;
21.3.2.3. each activity falling within the ambit of a competitive activity;
21.3.2.4. each capacity in relation to a competitive activity which the
covenantor is prohibited from holding in terms of this clause;
21.3.3. the restraints set out in clause 21.2 shall initially be given the
widest possible interpretation and no restraint or combination of restraints
shall be limited by reference to or inference from any other restraint or
combination of restraints, provided however that the invalidity or
unenforceability of any one or combination of restraints referred to in clause
21.2 (including the restraints interpreted in their widest cumulative sense as
aforesaid) shall not affect the validity or enforceability of any of the other
restraints referred to in clause 21.2 or another combination of such restraints.
21.4. No restraints referred to in this clause shall apply to any direct or
indirect shareholding by the seller in any company listed on a recognised stock
exchange where the aggregate direct and indirect holdings of the seller do not
exceed 5% (five per cent) of any class of that listed company's issued share
capital and the interest of the seller in that company is solely that of a
shareholder.
21.5. The above restraints shall enure also in favour of the successors in
title of the business.The term "successors in title" shall mean any person who -
21.5.1. acquires the goodwill of the business; or
21.5.2. becomes the beneficial owner of such goodwill through his
shareholding in any company; or
21.5.3. has acquired by cession the right to enforce the restraints
embodied herein.
21.6. The provisions of this clause 21 shall apply mutatis mutandis to
TOWNSEND, who undertakes to be bound thereby, any reference to the seller being
read as a reference to TOWNSEND.
21.7. Nothing contained in this clause 21 shall operate to prohibit or
restrict the seller and/or TOWNSEND retaining an interest in D&N WHOLESALERS CC
("D&N"), which is principally involved in the decanting, filling of glycerine,
the sale thereof and the distribution of cosmetics, provided that D&N shall
insofar as deodorants, hand and body lotions and perfumes are concerned,
restrict its activities to the distribution of the latter products.
22. AGENT'S COMMISSION
It is recorded that the sale was not concluded through the instrumentality
of any agent.
23. PRESS ANNOUNCEMENTS The parties agree that the initial press or public
announcements concerning the sale of the business shall be approved by both the
seller and the purchaser, which approval each undertakes shall not be
unreasonably withheld.
24. THE KNOW-HOW
24.1. The seller acknowledges that one of the fundamental bases upon which
this agreement has been concluded by the purchaser is to obtain the know-how.
The seller undertakes that -
24.1.1. no third party would be entitled to interdict or prohibit the
Purchaser from utilizing the know-how for the purposes of the business;
24.1.2. it will not directly or indirectly and whether or not for reward
use, whether for its own benefit or not, any such know-how;
24.1.3. it will not divulge any such know-how to any third party;
24.1.4. it will not make any statements concerning the know-how.
24.2. The seller warrants that it has not in the past disclosed the
know-how to third parties, which disclosure has in any way materially damaged or
could materially damage the business.
24.3. TOWNSEND shall be bound mutatis mutandis by this clause 24.
25. CONFIDENTIAL INFORMATION
Any information obtained by any party to this agreement in terms of, or
arising from the implementation of, this agreement shall be treated as
confidential by the parties and shall not be divulged or permitted to be
divulged to any person nor used or permitted to be used by any person not being
a party to this agreement, without the prior written consent of the other
parties save that -
25.1. any information which is required to be furnished by law or by The
Johannesburg Stock Exchange may be so furnished;
25.2. any party shall be entitled (after consultation with the other
parties so as to avoid embarrassment or prejudice to the extent possible) to
make such information available to its shareholders as may be necessary to
enable such shareholders to consider the value and prospects of their
shareholdings.
26. DOMICILIUM CITANDI ET EXECUTANDI
26.1. The parties choose as their domicilia citandi et executandi for all
purposes under this agreement, whether in respect of court process, notices or
other documents or communications of whatsoever nature, the following addresses
:
26.1.1. purchaser:
Physical: 427 - 15th Road RANDJESPARK
Midrand
Postal: Private Bag X103
HALFWAY HOUSE
1685
Telefax: (011) 314-4777
26.1.2. seller:
Physical: 86 Wolhuter Street
JEPPE
Johannesburg
2001
Postal: P O Box 28251
KENSINGTON
2101
Telefax: (011) 614-7726
26.1.3. TOWNSEND:
Physical: 86 Wolhuter Street
JEPPE
Johannesburg
2001
Postal: P O Box 28251
KENSINGTON
2101
Telefax: (011) 614-7726
26.2. Any notice or communication required or permitted to be given in
terms of this agreement shall be valid and effective only if in writing but it
shall be competent to give notice by telefax.
26.3. Any party may by notice to any other party change the physical
address chosen as its domicilium citandi et executandi vis-a-vis that party to
another physical address where postal delivery occurs in South Africa or its
postal address or its telefax number, provided that the change shall become
effective vis-a-vis that addressee on the 7th business day from the receipt of
the notice by the addressee.
26.4. Any notice to a party -
26.4.1. sent by prepaid registered post (by airmail if appropriate) in
correctly addressed envelope to it at an address chosen as its domicilium
citandi et executandi to which post is delivered shall be deemed to have been
received on the 7th business day after posting (unless the contrary is proved);
26.4.2. delivered by hand to a responsible person during ordinary business
hours at the physical address chosen as its domicilium citandi et executandi
shall be deemed to have been received on the day of delivery; or
26.4.3. sent by telefax to its chosen telefax number stipulated in clause
26.1, shall be deemed to have been received on the date of dispatch (unless the
contrary is proved).
26.5. Notwithstanding anything to the contrary herein contained a written
notice or communication actually received by a party shall be an adequate
written notice or communication to it notwithstanding that it was not sent to or
delivered at its chosen domicilium citandi et executandi.
27. BREACH
If any party breaches any material provision or term of this agreement
(other than those which contain their own remedies or limit the remedies in the
event of a breach thereof) and fails to remedy such breach within 10 (ten) days
of receipt of written notice requiring it to do so (or if it is not reasonably
possible to remedy the breach within 10 (ten) days, within such further period
as may be reasonable in the circumstances provided that the party in breach
furnishes evidence within the period of 10 (ten) days, reasonably satisfactory
to the other party, that it has taken whatever steps are available to it, to
commence remedying the breach)) then the aggrieved party shall be entitled
without notice, in addition to any other remedy available to it at law or under
this agreement, including obtaining an interdict, to cancel this agreement or to
claim specific performance of any obligation whether or not the due date for
performance has arrived, in either event without prejudice to the aggrieved
party's right to claim damages.
28. WHOLE AGREEMENT, NO AMENDMENT
28.1. This agreement constitutes the whole agreement between the parties
relating to the subject matter hereof.
28.2. No amendment or consensual cancellation of this agreement or any
provision or term hereof or of any agreement, bill of exchange or other document
issued or executed pursuant to or in terms of this agreement and no settlement
of any disputes arising under this agreement and no extension of time, waiver or
relaxation or suspension of or agreement not to enforce or to suspend or
postpone the enforcement of any of the provisions or terms of this agreement or
of any agreement, bill of exchang or other document issued pursuant to or in
terms of this agreement shall be binding unless recorded in a written document
signed by the parties. Any such extension, waiver or relaxation or suspension
which is so given or made shall be strictly construed as relating strictly to
the matter in respect whereof it was made or given.
28.3. No extension of time or waiver or relaxation of any of the provisions
or terms of this agreement or any agreement, bill of exchange or other document
issued or executed pursuant to or in terms of this agreement, shall operate as
an estoppel against any party in respect of its rights under this agreement, nor
shall it operate so as to preclude such party thereafter from exercising its
rights strictly in accordance with this agreement.
28.4. To the extent permissible by law no party shall be bound by any
express or implied term, representation, warranty, promise or the like not
recorded herein, whether it induced the contract and/or whether it was negligent
or not.
29. COSTS
All the costs on an attorney and own client basis of EDWARD NATHAN &
FRIEDLAND INC and KALLMEYER & STRIME Attorneys of and incidental to the
preparation of this agreement (including prior drafts and consultations) and the
stamp duty shall be borne by the purchaser and the seller in equal shares.
30. VALUE-ADDED TAX
30.1. The seller and the purchaser agree that the business is disposed of
as a going concern and for the purposes of section 11(1)(e) of the Value-Added
Tax Act, 1991, agree that the business will be an income-earning activity on the
effective date and that the assets which are necessary for carrying on such
business have been disposed of by the seller to the purchaser in terms of this
agreement.
30.2. If, notwithstanding the aforegoing, value-added tax is payable in
respect of any of the assets sold in terms hereof, same shall be borne and paid
by the purchaser.
31. JOINT AND SEVERAL LIABILITY OF TOWNSEND AND THE SELLER
The liability of TOWNSEND and the seller vis-a-vis the purchaser shall be
joint and several.
1
SIGNED by the parties and witnessed on the following dates and at the
following places respectively:
DATE PLACE WITNESS SIGNATURE
For: CARSON PRODUCTS
(PROPRIETARY) LIMITED
1./s/__________________
12/11/97 _______ /s/_________________________
2./s/__________________
For: A & J COSMETICS
(PROPRIETARY) LIMITED
1./s/__________________
12/11/97 _______ /s/_________________________
2./s/__________________
1./s/__________________
12/11/97 _______ /s/ Allan Townsend
2./s/__________________ ALLAN TOWNSEND
For: CARSON HOLDINGS
LIMITED
1./s/__________________
12/11/97 _______ /s/ Malcolm Yesner
2./s/__________________ MALCOLM YESNER
ANNEXURE A - DESIGNATED FIXED ASSETS
Fixed Assets
Motor vehicles
Description
BMW 535i (NHX 793T)
Toyota Forklift
Toyota Dyna (RFP546T)
Hilux (SVX152T)
Crown Forklift
Computer Equipment
Description
Proview Computer
Hewlett Packard Deskjet Printer
Computer 466DX Unix
Fujitsu Printer
Dolpin Computer
IBM Printer
Pentium 166 x 2
Printer HB 850
PS 3600 Delta Range
Metrohm Herisau
ICL notebook
Citoh Printer
Wyse Printer x 2
Wyse tereminal x 2
Printer Seikosha x 2
Buffer Box
Thoroughbred Unix~8
Software programs and modification
Office equipment
Adam D3228 safe
Intercom System
Alarm Systems
Speaker
Pabx system
Polisher
Close Circuit TV
Nashua Fax
Type writer
Helios Minolta Copier
Time Clock
Fridge
Cell Phone and cell Kit x 3
GEC Fridge
Shredder
Trolley
Klc fridge
Furniture and fittings
Office desk x 11
Credenza x 7
Kitchen Cupboard
Printer & Computer stand
Chairs x 26
Factory Chairs x 12
Bookcase & Cabinets x 11
Partitions
Display Cabinet
Lockers x 2
18 CFomp cabinate
Paintings
Wall unit
Plant and Machinery
Conveyer Belt x11
12 Head rochi filler
Bottle unscrambler
Scales x 5
Willie Hunt filler
Vacuum Filler
Martom filler
Bosch Mascar Filler
Gravfil filler 7 heads
Compressor x 7
Tanks x 3
Pamasol Gas filler
Cab Machines
Unscrambler
Dust collector
Powder plant
Silverson mixer x 8
Alcohol Pump x 3
Strapper machines
Hydraulic staker
Drone separator
Labeling Machine
Racking and shelving
Lipstick Mould
Banel bump
Hand bump
Purdy Gravfil capping machine
Pallet Trucks
Auto scrub Machine
Shrink Wrapper x 4
Boiler
Hot Plate
Thermo mate oven
ANNEXURE B - PRODUCTS
<TABLE>
<S> <C> <C> <C> <C>
Price Excl V.A.TPrice Inc. 14% QTY AMOUNT
V.A.T.
NAIL POLISH (12ml) * *
1. Snowy Pink 2. Shell Pink 3. New Pink
4. Sizzling Pink 5. Glitter 6. Clear
7. Sandle Wood 8. Dusty Pink 9. Pearly Peach
10. Valentia Orange 11. Red 12. Scarlet
13. Purple 14. Plum 15. Dark Maroon
16 Bronze 17. Blue 18. Black
19 Creme White 20. Black Cherry 21.____________
Nail Disc
LIPSTICK * *
1. Bright Red 2. Pearly Pink 3. Pinkish Red
4. Light Maroon 5. Dark Pink 6. Maroon
7. Dark Maroon 8. Rose Brown 9. Brown
10. Wine Brown 11. New Pink 12. Plum
13. Pink 14. Cerise 15. Rose Pink
16 Orange 17. Burnished Bronze 18. Lip Gloss
Herbal Bath (500ml) * *
Egg & Brandy Shampoo (500ml)
Cholestrol Hair Conditioner (500ml)
SADIE MASCARA Black Blue Brown Green Purple * *
SADIE MOISTURISING FOUNDATION * *
Honey Glow Amber Beige Tawny Rose Sunset Bronze
Chestnut Ivory Coral Sands Pebble Beach
Furniture Polish * *
Combi Brush Sets
Sadie Aftershave
EYESHADOWS * *
Golden Bronze Antique Copper Emerald Green
Brilliant Gold Super Pearl Royal Blue
Flamenco Red Pink Garnet Violet
Purple Silver Powder Blue
Cerise Khaki Strawberry
Nectar Kingfisher Blue
Shadow Applicators
EYESHADOW QUARTERS No. 1___ No. 2 ___ No. 3___ No. 4___ No. 5___ * *
DUO BLUSHERS No. 1___ No. 2 ___ No. 3___ No. 4___ No. 5___ No. 6___ No. 7___ * *
LOOSE FACE POWDER Satin Pink ____________ Silky Beige__________ * *
EYE PENCILS Black ____ Blue_____ Purple_____ Green_____ Charcoal____ * *
Brown_____
LIP LINERS 12cm
Sun Red________________ Brick_________________ Pink_______________
Pencil Sharpener
Brush Sets * *
SUB TOTAL * *
RAILAGE * *
TOTAL * *
* MATERIAL OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT AND SUBMITTED SEPARATELY.
</TABLE>
ANNEXURE C - PRODUCT FORMULATIONS
<TABLE>
<S> <C> <C> <C>
Product: Sadie Roll On Reg No.
Batch no.
Form. Completed by
Form Authorised by Theor.
Yield
Code Dated commenced Form. checked by
Process instr. no.: Date completed Material Quantities
Wgth Wght Mix
Chkd Re-ch Chkd
Lab Issue unit
Material Code Code Description of Material Standard Adjusted
9900062 *
9900072 *
9900001 *
9810009 *
9850015 *
Quality Bulk Actual Fact Costs: Total Material Costs:
Control Checked by Yield
Labour__________hrs___________
Equip___________kg/1___________
Assay__________________________
NETT BULK COST_____________1/kg
%
R.M. issued by:
Date
* MATERIAL OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT AND SUBMITTED SEPARATELY.
</TABLE>
ANNEXURE D - INDICITIVE INCOME STATEMENTS REFLECTING PROFITS
<TABLE>
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
A & J Cosmetics Division of Carson Products
Budgets Jan-98 to Dec-98
06-Nov-97
USA S.A.
SAR
Description Jan-98 Feb-98 Mar-98 Apr-98 May-98 Jun-98 Jul-98 Aug-98 Sept-98 Oct-98 Nov-98 Dec-98 Fiscal-98 %
* * * * * * * * * * * * * *
SALES
CASH DISCOUNTS .04%
Ad VALORUM TAXES 5.66%
SUNDRY INCOME
NET SALES
COST OF GOODS SOLD
GROSS MARGIN
EXPENSES
MEMBER SALARY
ADVERT
BAD DEBTS
BANK CHARGES
CLEANING
DEPREC
DISCOUNT ALLOWED
DONATIONS
ENTERTAIN
EXPORT EXP
FIRST AID
GEN EXP
GROUP LIFE
INSURANCE
INTEREST
LEASING
LICENSES
MED AID
MOTOR TRAV
POSTAGE
PRINT STAT
REBATES SCORE
REFRESH
RS LEVY
RENT 30%
RM MOTOR
RM OFFICE
SALARIES ADMIN
SALARIES SALES
SALARIES BONUS PROV
SECURITY
STAFF TRAIN
STAFF ADVERT
SUSCRIP
TELEPHONE
WAGES INDIRECT 15%
CONTINGENCY
TOTAL EXPENSES
INCOME BEFORE TAX
INCOME Tax @ 35.0 %
NET INCOME
* MATERIAL OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT AND SUBMITTED SEPARATELY.
</TABLE>
Chain Store Sales Sadie Brand of Carson Products
Budgets Jan-98 to Dec-98 Mar-97
20-Oct-97 EXCHANGE RATE US$ 1.00 = R 4.8 = $1.00
USA S.A.
SAR SOU
TWEL
<TABLE>
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Acct# Description Jan-98 Feb-98 Mar-98 Apr-98 May-98 Jun-98 Jul-98 Aug-98 Sept-98 Oct-98 Nov-98 Dec-98 Fiscal-98 %
Sales Southern Africa * * * * * * * * * * * * * *
5001 Gross Sales
5110 Returns/Adjustments
5201 Promotional Discounts/Bonus Stock
5300 Cash Discounts 2% of Gross sales
5115 Ad Valorum Taxes 5.66%
Net Sales
5600 Cost of Goods Sold (Incl. Plates artwork etc.)
Gross Margin
Selling Expenses
Advertising, Promotions, Research etc
6320 Trade Promotional Expenses 3.0%
3rd party Distribution, sales & merchand 9% of Sales
6510 Travel Expenses
6525 Dedicated Salaries & Wages (Incl. Auto)
6340 Rebates @ 5.0% of Gross Sales
6330 Samples
Total Selling Expenses
Admin Expenses & Deprec.
6605 Collection & Delivery Expenses 1% of Sales
7215 General Admin Fee (Incl. Debtors, financial audit etc.)
7321 Bad Debt Expense
Performance Bonus
All other
Total G&A Expenses
Utilities
7405 Telephone
Total Utility Expenses
Insurance & Taxes
Employee Insurance
7815 Employee Ins - Medical
Pensions
General Insurance
7860 All Insurance
Taxes
7871 Employer Social Security
7872 Unemployment Taxes
7876 Other Taxes RSC Levies
Total Insurance & Taxes
General & Admin Salaries
8005 G&A Salaries/Wages/Travel
7655 13th check (X-mas Bonus)
7660 Performance Bonus
Total G&A Salaries
Total Expenses
Income (Loss) before Interest & Taxes
9905 Income Taxes Payable 35%
Net Income
*MATERIAL OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT AND SUBMITTED SEPARATELY.
</TABLE>
ANNEXURE E - TRADEMARKS
<TABLE>
<S> <C> <C> <C> <C> <C> <C> <C> <C>
TRADE NAME CLASS COUNTRY CERTIFICATE NUMBCERTIFICATE DATE PERIOD EFFECTIVE FROM RENEWED PERIOD
/APPLICATION
Everglade 3 rsa 86/7013 21 November 1989 10 Years 22 october 1986 22 october 1996 10 years
Blue ice 3 rsa 83/6709 29 October 1985 10 years 20 September 1983 20 september 1993 10 years
Blue ice device (3) rsa 97/10819
dida 5 rsa 92/8441 10 march 1995 10 years 6 october 1992
melindy 3 rsa 90/2923 18 march 1993 10 years 18 april 1990
purdy 3 rsa 85/5788 9 march 1987 10 years 8 august 1985 8 august 1995 10 years
aljadent 3 rsa 83/2281 18 july 1994 10 years 15 april 1983 15 april 1993 10 years
cyclone 3 rsa 83/1850 16 may 1984 10 years 24 march 1983 24 march 1993 10 years
cyclone 3 rsa 83/1851 no certificate 24 march 1993 10 years
wild fragrance 3 rsa 93/8610 7 september 1995 10 years 24 september 1993
sadie silk 3 rsa 89/0340 16 october 1991 10 years 19 January 1989
impact 3 rsa 83/1851 16 may 1984 10 years 24 march 1983
impact 3 rsa 91/5166 18 october 1993 10 years 1 july 1991
impact 3 zambia 272/93 9 July 1996 10 years 16 august 1993
impact 3 zimbabwe 609/93 29 november 1993 10 years 15 july 1993
Sadie 3 rsa 77/4007 8 september 1993 10 years 7 september 1977 7 september 1987 10 years
7 september 1997 10 years
sadie 3 rsa 91/5555 6 march 1995 10 years 16 july 1991
sadie 3 zambia 273/93 6 july 1996 10 years 16 august 1993
sadie 3 zimbabwe 605/93 29 november 1993 10 years 15 july 1993
Brookynn withdrawn 15 july 1991
Dida 3 92/8440 withdrawn refer letter dated 5 may 1995 j. galgut
showman 91/5527 withdrawn refer letter dated 17 December 1992 j. galgut
</TABLE>
Startline 3
5
in Progress
25
ANNEXURE F - SALES AND PROFIT BUDGET
A & J Cosmetics Division of Carson Products
Budgets Jan-98 to Dec-98
06-Nov-97
USA S.A.
<TABLE>
SAR
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Description Jan-98 Feb-98 Mar-98 Apr-98 May-98 Jun-98 Jul-98 Aug-98 Sept-98 Oct-98 Nov-98 Dec-98 Fiscal-98 %
* * * * * * * * * * * * *
SALES
CASH DISCOUNTS .04%
Ad VALORUM TAXES 5.66%
SUNDRY INCOME
NET SALES
COST OF GOODS SOLD
GROSS MARGIN
EXPENSES
MEMBER SALARY
ADVERT
BAD DEBTS
BANK CHARGES
CLEANING
DEPREC
DISCOUNT ALLOWED
DONATIONS
ENTERTAIN
EXPORT EXP
FIRST AID
GEN EXP
GROUP LIFE
INSURANCE
INTEREST
LEASING
LICENSES
MED AID
MOTOR TRAV
POSTAGE
PRINT STAT
REBATES SCORE
REFRESH
RS LEVY
RENT 30%
RM MOTOR
RM OFFICE
SALARIES ADMIN
SALARIES SALES
SALARIES BONUS PROV
SECURITY
STAFF TRAIN
STAFF ADVERT
SUSCRIP
TELEPHONE
WAGES INDIRECT 15%
CONTINGENCY
TOTAL EXPENSES
INCOME BEFORE TAX
INCOME Tax @ 35.0 %
NET INCOME
*MATERIAL OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT AND SUBMITTED SEPARATELY.
</TABLE>
Chain Store Sales Sadie Brand of Carson Products
Budgets Jan-98 to Dec-98 Mar-97
20-Oct-97 EXCHANGE RATE US$ 1.00 = R 4.8 = $1.00
USA S.A.
SAR SOU
TWEL
<TABLE>
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Acct# Description Jan-98 Feb-98 Mar-98 Apr-98 May-98 Jun-98 Jul-98 Aug-98 Sept-98 Oct-98 Nov-98 Dec-98 Fiscal-98 %
5001 Gross Sales * * * * * * * * * * * * *
5110 Returns/Adjustments
5201 Promotional Discounts/Bonus Stock
5300 Cash Discounts 2% of Gross sales
5115 Ad Valorum Taxes 5.66%
Net Sales
5600 Cost of Goods Sold (Incl. Plates artwork etc.)
Gross Margin
Selling Expenses
Advertising, Promotions, Research etc
6320 Trade Promotional Expenses 3.0%
3rd party Distribution, sales & merchand 9% of Sales
6510 Travel Expenses
6525 Dedicated Salaries & Wages (Incl. Auto)
6340 Rebates @ 5.0% of Gross Sales
6330 Samples
Total Selling Expenses
Admin Expenses & Deprec.
6605 Collection & Delivery Expenses 1% of Sales
7215 General Admin Fee (Incl. Debtors, financial audit etc.)
7321 Bad Debt Expense
Performance Bonus
All other
Total G&A Expenses
Utilities
7405 Telephone
Total Utility Expenses
Insurance & Taxes
Employee Insurance
7815 Employee Ins - Medical
Pensions
General Insurance
7860 All Insurance
Taxes
7871 Employer Social Security
7872 Unemployment Taxes
7876 Other Taxes RSC Levies
Total Insurance & Taxes
General & Admin Salaries
8005 G&A Salaries/Wages/Travel
7655 13th check (X-mas Bonus)
7660 Performance Bonus
Total G&A Salaries
Total Expenses
Income (Loss) before Interest & Taxes
9905 Income Taxes Payable 35%
Net Income
*MATERIAL OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT AND SUBMITTED SEPARATELY.
</TABLE>
The agreement is to incorporate a clause stating that all employees listed below
are to be employed by Carson Products on the same conditions (as per agreement
given to you) and at the same salary listed below from the 1st January 1998. The
only difference between the hourly paid workers and the salaried staff is that
the salaried staff work 40 hours per week
COMPANY DATE OF Name RATE OF PAY POSITION
NUMBER ENGAGEMENT
3 01/03/78 A. Moloisane 19.617 p/h Sales lady
5 27/07/83 A. Sebesho 29.423 p/h compounder
28 08/08/88 N. Leboho 10.805 p/h production
32 07/08/86 P. Bame 17.159 p/h Stores
44 06/06/86 M. Radebe 19.730 p/h qc asst
54 02/07/90 A. Nhlapo 11.608 p/h production
60 16/07/90 V. Xulu 9.796 p/h stores
61 16/07/90 D. Thusini 10.936 p/h production
62 16/07/90 N. Ngqulunga 11.462 p/h production
63 16/07/90 Z. Khumalo 10.006 p/h production
64 16/07/90 R. Sithole 9.796 p/h production
65 16/07/90 F. Mkhize 9.796 p/h production
66 30/07/90 P. Ngocobo 9.796 p/h production
67 10/07/95 F. Smuts 9.247 p/h stores
68 30/07/90 S. Mthimkhulu 10.006 p/h production
69 30/07/90 I. Hermanus 9.796 p/h production
70 09/03/92 N.mthethwa 8.252 p/h production
71 30/07/90 M. Biyela 9.796 p/h production
72 09/03/92 J. Thabethe 8.252 p/h production
73 30/07/90 D. Jaxa 10.971 p/h production
74 05/12/89 E. Tshandu 11.207 p/h production
75 30/07/90 M. Khumalo 9.796 p/h stores
76 09/03/92 E. Gindi 8.252 p/h production
77 21/06/93 G. Mbatha 7.867 p/h production
78 29/04/91 M. Nhlebela 12.404 p/h stores
79 09/05/94 S. Khasane 7.867 p/h delivery
80 13/08/90 G. Mmekwa 10.006 p/h production
81 09/03/92 A. Thabethe 8.252 p/h production
82 28/08/90 H. Njotini 9.796 p/h production
83 28/08/90 G. Molapo 9.796 p/h production
84 09/03/92 C. Mayisela 8.252 p/h production
85 21/04/97 H.prince 13.437 p/h driver
86 08/10/90 T. Moshe 10.879 p/h compounding
87 05/11/90 E. Gamede 12.008 p/h sales lady
89 19/08/91 L. Sebeko 8.854 p/h cleaning
90 07/07/97 W. Xaba 7.867 p/h production
92 09/03/92 N. Vilakazi 8.252 p/h delivery
93 09/03/92 W. Mkhwanazi 8.252 p/h production
94 31/10/94 S. Mtshali 7.867 p/h production
95 07/07/97 E. Mchunu 7.867 p/h production
96 19/05/92 j. mncube 8.252 p/h production
98 31/08/92 C. Tobias 8.429 p/h production
100 23/08/93 N. Moloisane 8.725 p/h stores
101 18/10/93 A. Marakane 8.538 p/h compounding
102 03/01/94 M. Ramaube 7.867 p/h production
1 01/05/83 N. Davis 11204.00 p/m sales manager
2 26/02/85 M. Fisher 10261.00 p/m prod.manager
4 03/02/86 T. Nakedi 6805.00 p/m compounder
6 01/11/85 P. V/d vyver 11953.00 p/m admin manager
7 01/02/90 D. Merrell 10642.00 p/m w/house manager
17 16/05/91 R. Williams 9254.00 p/m sales internal
18 26/04/93 R. Westbrook 8946.00 p/m qc manager
22 07/08/91 M. Hendry 6975.00 p/m bookkeeper
26 05/06/96 D. Griesel 3675.00 p/m receptionist
01/05/85 J. Emond 5700.00 p/m w/h data clerk
01/01/78 H.r.Townsend 15000.000 p/m managing director
ANNEXURE~H - TERMS OF HIRE OF LEASE PREMISES
1. DEFINITIONS
The following terms shall have the meanings assigned to them hereunder and
cognate expressions shall have a corresponding meaning, namely -
1.1 "building" means the building/s on the property;
1.2 "landlord" means SADIE INVESTMENTS (PROPRIETARY) LIMITED;
1.3 "main agreement" means the agreement to which this annexure constitutes
Annexure~H;
1.4 "tenant" means CARSON PRODUCTS (PROPRIETARY) LIMITED;
1.5 "premises" means the property and the buildings and other improvements
situated on the property;
1.6 "property" means the property situated at 86 Wolhuter Street. Jeppe,
Johannesburg, 2096.
2. RESOLUTIVE CONDITION
This agreement shall be deemed to be subject to the same resolutive
condition as the resolutive condition contained in the main agreement (the
"resolutive condition"). If the resolutive condition is fulfilled and
accordingly the main agreement ceases ipso facto to be of any force or effect,
this agreement of lease shall similarly cease ipso facto to be of any force or
effect and the provisions of clause~2 (read together with clause~3.2) shall be
deemed mutatis mutandis to be incorporated herein.
3. HIRE
The landlord lets to the tenant which hires the premises.
4. DURATION
This lease shall commence on 1 November 1997 and shall continue for a
period of 18 (eighteen) months until 30~April 1999 or such longer period as may
be agreed to in writing by the parties.
5. RENTAL
1.7 The monthly rental payable by the tenant to the landlord shall be
R40~000,00 (forty thousand rand) (exclusive of VAT).
1.8 The rental shall be paid by the tenant to the landlord monthly in
advance on the first day of each month.
1.9 All amounts payable by the tenant to the landlord in terms of this
lease shall be paid at the landlord's domicilium citandi et executandi referred
to in the main agreement.
6. ASSESSMENT RATES AND MUNICIPAL CHARGES
The landlord shall be exclusively responsible and liable for the payment of
all and any assessment rates and municipal charges which are payable to the
local or any other authority in respect of the premises or the buildings on the
premises.
7. ELECTRICITY, WATER AND SANITATION FEES
The tenant shall pay on demand to the landlord or to the local authority or
body concerned, as the landlord may require -
1.10 the costs of all electricity, water and gas, if any, consumed on the
premises; and
1.11 all refuse removal charges, sanitary fees and domestic and industrial
effluent fees levied from time to time in respect of the premises (including
basis and services charges).
8. DISPUTES AS REGARDS TENANT'S LIABILITY FOR THE PAYMENTS OF ANY AMOUNT
If there is dispute as to the tenant's liability for the payment of any of
the items referred to in paragraph~7, or as to the amount of such liability, the
decision of the landlord's auditors, who shall act as experts and not as
arbitrators and who shall determine the liability for their charges which shall
be paid accordingly, shall be final and binding upon the parties.
9. SUB-LETTING OR ASSIGNMENT
The tenant shall not -
1.12 cede or assign or pledge or otherwise encumber this lease or any of
its rights hereunder: or
1.13 sub-let the leased premises or any party thereof; or
1.14 give up occupation or possession of the premises or portion thereof to
any person or permit any person to enter into possession of or to occupy or take
possession of the premises or any portion thereof for either a definite period
or at all, without the landlord's prior written consent, without the landlord's
prior written consent.
10. THE TENANT'S GENERAL RIGHTS AND OBLIGATIONS
The tenant :-
1.15 shall be entitled to use the leased premises only for the conduct
therein of the business;
1.16 maintain the premises and all parts thereof in the same condition in
which they are at the commencement of this lease, fair wear and tear excepted;
1.17 shall not keep or do or permit to be kept or done in the premises
anything which, in terms of any conditions of any insurance policy held from
time to time by the landlord in respect of the building or any part thereof, may
not be kept or done therein or may render same void or voidable or which will or
may increase the rate of premiums payable in respect of any such insurance
policy;
1.18 not contravene or permit the contravention of any law, by-law or
statutory regulation or conditions or any license relating to or affecting the
occupation of the premises;
1.19 shall not install or change or interfere with the premises or with
electrical, plumbing or air-conditioning installations or equipment in the
premises without the prior written consent of the landlord;
1.20 shall not be entitled to fix, paint, erect, install or display any
advertising or other signs on the premises or in any manner without the
landlord's prior written consent
1.21 shall at all time keep the premises clean and tidy;
1.22 shall not effect any alternations, additions or improvements to the
interior or exterior or the premises, whether structural or otherwise, without
the landlord's prior written consent;
1.23 afford the landlord reasonable access to the premises at any time to
repair, improve, alter or add to the building, the lease premises or any part
thereof;
1.24 afford the landlord reasonable access to the premises to show the
premises to any prospective tenants of the premises or purchaser of the
property.
11. LANDLORD'S CONSENT
Where in terms of this agreement the tenant is required to secure the
landlord's consent, the landlord undertakes not to withhold such consent
unreasonably.
12. BREACH
If any party breaches any material provision or term of this annexure and
fails to remedy such breach within 7 (seven) days of receipt of written notice
requiring it to do so (or if it is not reasonably possible to remedy the breach
within 7 (seven) days, within such further period as may be reasonable in the
circumstances provided that the party in breach furnishes evidence within the
period of 7 (seven) days, reasonably satisfactory to the other party, that it
has taken whatever steps are available to it, to commence remedying the breach))
then the aggrieved party shall be entitled without notice, in addition to any
other remedy available to it at law or under this annexure, including obtaining
an interdict, to cancel this annexure or to claim specific performance of any
obligation whether or not the due date for performance has arrived, in either
event without prejudice to the aggrieved party's right to claim damages.
13. WHOLE AGREEMENT, NO AMENDMENT
1.25 This annexure constitutes the whole agreement between the parties
relating to the subject matter hereof.
1.26 No amendment or consensual cancellation of this annexure or any
provision or term hereof or of any agreement, bill of exchange or other document
issued or executed pursuant to or in terms of this agreement and no settlement
of any disputes arising under this agreement and no extension of time, waiver or
relaxation or suspension of or agreement not to enforce or to suspend or
postpone the enforcement of any of the provisions or terms of this annexure or
of any agreement, bill of exchange or other document issued pursuant to or in
terms of this agreement shall be binding unless recorded in a written document
signed by the parties. Any such extension, waiver or relaxation or suspension
which is so given or made shall be strictly construed as relating strictly to
the matter in respect whereof it was made or given.
1.27 No extension of time or waiver or relaxation of any of the provisions
or terms of this annexure or any agreement, bill of exchange or other document
issued or executed pursuant to or in terms of this annexure, shall operate as an
estoppel against any party in respect of its rights under this annexure, nor
shall it operate so as to preclude such party thereafter from exercising its
rights strictly in accordance with this annexure.
1.28 To the extent permissible by law no party shall be bound by any
express or implied term, representation, warranty, promise or the like not
recorded herein, whether it induced the contract and/or whether it was negligent
or not.
14. STAMP DUTY
The tenant shall be liable for the stamp duty payable in respect of the
lease.
ANNEXURE~I - TOWNSEND SERVICE AGREEMENT
entered into between
CARSON PRODUCTS (PROPRIETARY) LIMITED (Registration No 93/02698/07)
and
ALLAN TOWNSEND
WHEREBY IT IS AGREED AS FOLLOWS:
1. INTERPRETATION AND PRELIMINARY
The headings of the clauses in this agreement are for the purpose of
convenience and reference only and shall not be used in the interpretation of
nor modify nor amplify the terms of this agreement nor any clause hereof. Unless
a contrary intention clearly appears - words importing -
1.1.1 any one gender include the other two genders;
1.1.2 the singular include the plural and vice versa; and
1.1.3 natural persons include created entities (corporate or unincorporate)
and the state and vice versa; the following terms shall have the meanings
assigned to them hereunder and cognate expressions shall have corresponding
meanings, namely -
1.1.4 "board" means the board of directors of the company from time to
time;
1.1.5 "competing goods" means any goods sold in competition with the
prescribed goods;
1.1.6 "competing services" means any services rendered in competition with
the prescribed services;
1.1.7 "company" means CARSON PRODUCTS (PROPRIETARY) LIMITED;
1.1.8 "employee" ALLAN TOWNSEND;
1.1.9 "prescribed areas" means each magisterial district in the Republic of
South Africa;
1.1.10 "prescribed customers" means any person -
a) who is or was a prospective customer of the company at the termination
date; or b) who is or was a prospective customer of the company at the
termination date whom the employee had approached to do business with the
company within the period of 1 (one) year preceding the termination date; or c)
who purchased prescribed goods from the company within the period of 1 (one)
year preceding the termination date; or d) to whom prescribed services were
rendered by the company within the period of 1 (one) year preceding the
termination date;
1.1.11 "prescribed goods" means any goods which are dealt in by the company
in the ordinary course of business;
1.1.12 "prescribed services" means any services which are dealt in by the
company in the ordinary course of business;
1.1.13 "prescribed suppliers" means any person -
a) is or was a supplier of prescribed goods and/or prescribed services to
the company at the termination date; or b) is or was a prospective supplier of
prescribed goods and/or prescribed services to the company at the termination
date whom the employee had approached to do business with the company within the
period of 1 (one) year preceding the termination date; or c) supplied prescribed
goods and/or prescribed services to the company within the period of 1 (one)
year preceding the termination date;
1.1.14 "termination date" means the date upon which the employee's
employment by the company ceases or is terminated for any reason whatsoever; any
reference in this agreement to "date of signature hereof" shall be read as
meaning a reference to the date of the last signature of this agreement; if any
provision in a definition is a substantive provision conferring rights or
imposing obligations on any party, notwithstanding that it is only in the
definition clause, effect shall be given to it as if it were a substantive
provision in the body of the agreement; when any number of days is prescribed in
this agreement, same shall be reckoned exclusively of the first and inclusively
of the last day unless the last day falls on a Saturday, Sunday or public
holiday, in which case the last day shall be the next succeeding day which is
not a Saturday, Sunday or public holiday; where figures are referred to in
numerals and in words, if there is any conflict between the two, the words shall
prevail.
2. RESOLUTIVE CONDITION This agreement shall be deemed to be subject to the
same resolutive condition as the resolutive condition contained in the agreement
to which this agreement constitutes Annexure I (the "main agreement"). If the
resolutive condition is fulfilled and accordingly the main agreement ceases ipso
facto to be of any force or effect, this agreement of lease shall similarly
cease ipso facto to be of any force or effect and the provisions of clause~2
read together with clause 3.2 shall be deemed mutatis mutandis to be
incorporated herein).
3. APPOINTMENT OF EMPLOYEE The company appoints the employee as its General
Manager in respect of the "A&J" division of the company. The employee accepts
such appointment.
4. PERIOD OF EMPLOYMENT The employee's employment shall commence on 1
November 1997 and shall be terminable on not less than 2 (two) calendar months'
written notice given by the company or the employee to the other, provided that
- - no such notice may be given so as to terminate the employee's employment
before 30~April 1999; and the company shall be entitled to terminate the
employee's employment summarily (or on such other basis as it considers
appropriate) if the employee -
4.1.1 is guilty of conduct justifying a summary dismissal according to the
common law; and/or
4.1.2 is guilty of conduct which is likely to bring himself or the company
into disrepute or is convicted of an offence involving dishonesty; and/or
4.1.3 commits a breach of any of the terms of this agreement; and/or
4.1.4 becomes incapacitated, which shall mean that -
4.1.4.1 he is precluded in terms of any statute from holding office as a
director; or
4.1.4.2 he has suffered some illness or disability which has precluded him
from providing his services hereunder for a period in excess of 90 (ninety) days
in the determination of which intermittent returns to work or service which do
not constitute a bona fide resumption of duties shall be disregarded.
5. EFFECT OF TERMINATION OF EMPLOYMENT
The termination of the employee's employment for any reason whatsoever
shall not affect the operation of any provisions of this agreement to the extent
to which they confer rights or impose obligations upon the parties which are
exercisable or enforceable after the termination date, and such provisions shall
to that extent continue to be of full force and effect. The termination of the
employee's employment shall furthermore not prejudice any rights which have
accrued to the parties as at the termination date.
6. SUSPENSION OF EMPLOYMENT
If the company suspects that the employee is guilty of the conduct referred
to in clause 4.2.1 and/or clause 4.2.2, or any other conduct which may, if
proved, justify his dismissal, or has committed a breach of any of the terms of
this agreement, it may, pending a duly constituted enquiry into the alleged
conduct in question, but without prejudice to its right of summary dismissal in
terms of clause 4.2 and without giving rise to any claim for damages or
otherwise against it, suspend the employee for a period not exceeding 90
(ninety) days during which the employee shall
- not be entitled to attend work at the premises of the company; be
entitled to his normal salary.
7. DUTIES OF EMPLOYEE
The employee shall -
devote the whole of his time and attention during the company's normal
business hours, and such reasonable amount of additional time as may be
necessary on an unpaid basis, having regard to the exigencies of the business of
the company, to the business and affairs of the company (and, in particular, the
A&J Division of the company) and shall not, before the date referred to in
clause~4.1 of this agreement (unless it is terminated prematurely as the result
of or by wrongful conduct by the company) or during any period after such date
in which he is employed by the company, without the company's prior written
consent, whether as proprietor, partner, director, shareholder, member,
employee, consultant, contractor, financier, agent, representative, assistant,
trustee or beneficiary of a trust or otherwise, and whether for reward or not,
directly or indirectly be interested or engaged in or concerned with or employed
by any business, trade, undertaking or concern -
7.1.1 other than that of the company; or
7.1.2 which competes with any business carried on by the company, the
undertakings in clauses 7.1.1 and 7.1.2 being separate, provided that he shall
not be deemed to have breached his undertakings by reason of -
7.1.3 he having bona fide financial interests in businesses, trades,
undertakings or concerns which do not directly or indirectly compete with the
company which have been disclosed to the company in writing and/or after
disclosing his intention to do so to the company in writing his accepting
appointment as a non-executive director of such businesses, trades, undertakings
or concerns and devoting a reasonable amount of time to such financial interests
and directorships, provided that no such interests of or activities by the
employee are prejudicial to or adversely affect the performance of his duties
hereunder; and/or
7.1.4 he holding shares in any company the shares of which are listed on a
recognized stock exchange if the shares owned by him and the persons, companies
and trusts referred to in clause 14.3.4 do not in the aggregate constitute more
than 5% (five per cent) of any class of the issued share capital of such
company; and/or
7.1.5 he being an officer of or holding shares in the company; obey the
orders and directions of the board, any managing director and any properly
authorized officer or official of the company, shall carry out such functions
and duties as are from time to time assigned to him and are consistent with his
status and use his utmost endeavors to protect and promote the business and
interests of the company and to preserve its reputation and goodwill; not,
during the operation of this agreement or thereafter, regardless of the reason
for termination of his employment, use for his own benefit or for the benefit of
any other person or divulge or communicate to any person or persons, except to
those of the officials of the company whose province it is to know the same, any
of the company's secrets or any other information which he may receive or obtain
in relation to the company's affairs or its customers or to the working of any
process or invention or to any marketing technique which is carried on or used
by the company; be true and faithful to the company in all dealings and
transactions whatsoever relating to its business and interests; submit to the
board or to any person nominated by it, such information and reports as may be
required of him in connection with the performance of his duties and the
business of the company; not, at any time during the operation of this
agreement, directly or indirectly, act in the manner referred to in clause 14.3
or 14.4 or attempt to do so.
8. REMUNERATION
As remuneration for his services hereunder the company shall pay the
employee a monthly salary at the rate of :- R15 000,00 (fifteen thousand rand)
per month for the period commencing on 1~November 1997 and ending on 31~December
1998; R20 000,00 (twenty thousand rand) per month for the period commencing on
1~January~1999 and ending on 30~April 1999.
9. MOTOR VEHICLE
The company shall pay the cost of insuring, licensing and maintaining the
employee's motor vehicle and of reasonable fuel, lubricants and repairs in
regard to such motor vehicle.
10. INVENTIONS, DISCOVERIES AND COPYRIGHT
Any discovery or invention or secret process or improvement in procedure
made or discovered by the employee in the course and score of his employment by
the company in connection with or in any way affecting or relating to the
business of the company or capable of being used or adapted for use by the
company or in connection with its business shall be disclosed to the company and
shall belong to and be the absolute property of the company. The employee shall,
if and when required by the company, apply or join with the company at its
expense in applying for Letters Patent or other equivalent protection in the
Republic of South Africa or in any other part of the world for such discovery,
invention, process or improvement and shall at the company's expense execute all
instruments and do all things necessary for vesting the said Letters Patent or
other equivalent protection in the name of the company as sole beneficial owner
or in the name of such other person as the company may nominate. Insofar as may
be necessary the employee assigns to the company the copyright in all present
and future works eligible for copyright, including, without limitation, literary
or artistic works or software programs of which he may be the author, which
works were or are created, compiled, devised or brought into being during the
course and scope of his employment by the company. No consideration shall be
payable by the company to the employee in respect of this assignment. All
reports, manuals, financial statements, budgets, indices, research papers,
letters or other similar documents (the nature of which is not limited by the
specific reference to the foregoing items) which are created, compiled or
devised or brought into being by the employee or come into the employee's
possession during the course and scope of his employment by the company and all
copies thereof will be the property of the company and, upon the termination
date or earlier if required by the company, such documents and all copies shall
be returned to the company.
11. LEAVE
The employee shall be entitled to 20 (twenty) days leave on full pay in
respect of each 12 (twelve) months' cycle of employment, to be taken at such
time or times as are convenient to the company. Leave not taken when it is due
otherwise than at the instance of the company may not be accumulated.
12. OUT OF POCKET EXPENSES
The company shall refund to the employee the out-of-pocket expenses
incurred by him on behalf of the company which are substantiated by vouchers
therefor and which have been approved by the board or are incurred in accordance
with principles determined by it from time to time.
13. PENSION FUND
The employee shall be obliged to become a member of the company's pension
fund, group life and medical aid schemes (if any) on the normal terms and
conditions from time to time applicable to an employee of the company but
subject to the employee's eligibility for membership.
14. RESTRAINT OF TRADE
It is recorded that in the course of his duties the employee -
14.1.1 has acquired and/or will acquire considerable know-how in and will
learn of the company's techniques relating to the manufacture, marketing, sale
and distribution of toiletry products;
14.1.2 will have access to names of customers and the licensors and
suppliers with whom the company does business whether embodied in written form
or otherwise;
14.1.3 will have the opportunity of forging personal links with customers,
licensors and suppliers of the company; and
14.1.4 generally will have the opportunity of learning and acquiring the
trade secrets, business connections and other confidential information
appertaining to the company's business. It is acknowledged that the only
effective and reasonable manner in which the company's rights in respect of its
business secrets and customer connection can be protected is the restraint
imposed upon the employee in terms of this clause 14. Subject to the provisions
of clause 14.7 below, but without derogating from the employee's obligations
under clause 7.1, the employee shall not, for 4 (four) years from the
termination date, whether as proprietor, partner, director, shareholder, member,
employee, consultant, contractor, financier, agent, representative, assistant,
trustee or beneficiary of a trust or otherwise and whether for reward or not,
directly or indirectly :-
14.1.5 carry on; or
14.1.6 be interested or engaged in or concerned with or employed by any
company, close corporation, firm, undertaking or concern which carries on, in
any of the prescribed areas any business which sells prescribed goods or
competing goods or renders prescribed services or competing services or in the
course of which prescribed goods or competing goods are sold or prescribed
services or competing services are rendered; provided that the employee shall
not be deemed to have breached his undertaking by reason of his -
14.1.7 holding shares in the company; or
14.1.8 holding shares in any company the shares of which are listed on a
recognised stock exchange if the shares owned by -
14.1.8.1 him;
14.1.8.2 his ascendants and descendants;
14.1.8.3 his spouse;
14.1.8.4 any person related to his or his spouse within the third degree of
consanguinity;
14.1.8.5 any trust created primarily for the benefit of one or more of the
persons referred to in clauses 14.3.4.1 to 14.3.4.4; and
14.1.8.6 any company effectively controlled by one or more of the persons
and trusts referred to in clauses 14.3.4.1 to 14.3.4.5 do not in the aggregate
constitute more than 5% (five per cent) of any class of the issued share capital
of such company. Subject to the provisions of clause 14.7 below, the employee
undertakes that neither his nor any company, close corporation, firm,
undertaking or concern in or by which he is directly or indirectly interested or
employed will within 4 (four) years after the termination date and whether for
reward or not, directly or indirectly -
14.1.9 encourage or entice or incite or persuade or induce any other
employee of the company, who was employed whilst the employee was employed by
the company and who is engaged or participates in the sale or other marketing by
the company of the prescribed goods, or in a material respect in the rendering
or in the marketing of the prescribed services, to terminate his employment by
the company; or
14.1.10 furnish any information or advice to any employee to whom clause
14.4.1 applies or to any prospective employer of such employee or use any other
means which are directly or indirectly designed, or in the ordinary course of
events calculated, to result in any such employee terminating his employment by
the company and/or becoming employed by or directly or indirectly in any way
interested in or associated with any other company, close corporation, firm,
undertaking or concern; or
14.1.11 furnish any information or advice (whether oral or written) to any
prescribed customer that the employee intends to or will (whether as proprietor,
partner, director shareholder, member, employee, consultant, contractor,
financier, agent, representative or otherwise) directly or indirectly, be
interested or engaged in or concerned with or employed by any company, close
corporation, firm, undertaking or concern carried on in any of the prescribed
areas which sells prescribed goods or competing goods or renders prescribed
services or competing services or in the course of which prescribed goods or
competing goods are sold or prescribed services or competing services are
rendered after the expiry of 4 (four) years after the termination date; or
14.1.12 furnish any information or advice (whether oral or written) to any
prescribed customer or use any other means or take any other action which is
directly or indirectly designed, or in the ordinary course of events calculated,
to result in any such prescribed customer terminating his association with the
company and/or transferring his business to or purchasing any prescribed goods
or competing goods or accepting the rendering of any prescribed services or
competing services from any perso other than the company, or attempt to do so.
Subject to the provisions of clause 14.7 but without derogating from the
obligations imposed by this clause 14, the employee undertakes that neither he
nor any company, firm, undertaking or concern in or by which he is directly or
indirectly interested, engaged, concerned or employed will for a period of 4
(four) years after the termination date directly or indirectly, whether as
proprietor, partner, director, shareholder, employee, consultant, contractor,
financier, agent, representative, assistant, trustee or beneficiary of a trust
or otherwise in any part of the prescribed areas and whether for reward or not -
14.1.13 solicit orders from prescribed customers for the prescribed goods
or any competing goods and/or the prescribed services or any competing services;
14.1.14 canvass business in respect of the prescribed goods or any
competing goods and/or the prescribed services or any competing services from
prescribed customers;
14.1.15 sell or otherwise supply any prescribed goods or competing goods to
any prescribed customer;
14.1.16 render any prescribed services or competing service to any
prescribed customer;
14.1.17 purchase any prescribed goods from any prescribed supplier or
accept the rendering of any prescribed services from it;
14.1.18 solicit appointment as a distributor, licensee, agent or
representative of any prescribed supplier in respect of prescribed goods and/or
prescribed services, including on behalf of or for the benefit of a prescribed
supplier. Each of the undertakings set out in this clause 14 (including those
appearing in a single clause) is severable inter alia as to -
14.1.19 nature of interest, act or activity;
14.1.20 the categories of persons falling within the definition of
prescribed customers;
14.1.21 the categories of goods falling within the definition of the
prescribed goods and competing goods;
14.1.22 the categories of services falling within the definition of the
prescribed services and competing services;
14.1.23 the categories of persons falling within the definition of
prescribed supplier;
14.1.24 the individual magisterial districts and areas which are defined as
the prescribed areas and are acknowledged to be reasonably required for the
protection of the company and are generally fair and reasonable. Nothing
contained in this clause 14 shall operate to prohibit or restrict the employee
retaining an interest in D&N WHOLESALERS CC ("D&N"), which is principally
involved in the decanting, filling of glycerine, the sale thereof and the
distribution of cosmetics, provided that D&N shall insofar as deodorants, hand
and body lotions and perfumes are concerned, restrict its activities to the
distribution of the latter products.
15. GENERAL
No remedy granted by this agreement shall exclude any other remedy
available at law. No amendment of this agreement or any consensual cancellation
thereof or any part thereof shall be binding on the parties unless reduced to a
written document and signed by them. If any of the terms of this agreement, such
as the rate of remuneration payable to the employee, are varied, the other terms
shall, unless otherwise agreed in writing, remain of full force and effect. No
relaxation or indulgence which the company may show to the employee shall in any
way prejudice or be deemed to be a waiver of its rights hereunder nor shall such
relaxation or indulgence preclude or estop the company from exercising its
rights in terms of this agreement in respect of any further breach. This
agreement constitutes the whole agreement between the parties and no warranties
or representations whether express or implied have been given or made by the
company to the employee. The company shall be entitled to cede and delegate all
or any of its rights and obligations under this agreement to the successor in
title of the undertakings of the company or any member thereof, whether such
cession and delegation takes place before or after the termination date.
16. DOMICILIUM CITANDI ET EXECUTANDI
The parties choose as their domicilia citandi et executandi for all
purposes under this agreement, whether in respect of court process, notices or
other documents or communications of whatsoever nature, the following addresses:
16.1.1 employer:
Physical: 427 - 15th Road
RANDJESPARK
Midrand
Postal: Private Bag X103
HALFWAY HOUSE
1685
Telefax: (011) 314-4777
16.1.2 employee:
Physical: 86 Wolhuter Street
JEPPE
Johannesburg
2001
Postal: P O Box 28251
KENSINGTON
2101
Telefax: (011) 614-7726
Any notice or communication required or permitted to be given in terms of
this agreement shall be valid and effective only if in writing but it shall be
competent to give notice by telefax. Either party may by notice to the other
party change the physical address chosen as its domicilium citandi et executandi
to another physical address where postal delivery occurs in South Africa or its
postal address or its telefax number, provided that the change shall become
effective on the 7th business day from the deemed receipt of the notice by the
other party. Any notice to a party -
16.1.3 sent by prepaid registered post (by airmail if appropriate) in a
correctly addressed envelope to it at an address chosen as its domicilium
citandi et executandi to which post is delivered shall be deemed to have been
received on the 7th business day after posting (unless the contrary is proved);
16.1.4 delivered by hand to a responsible person during ordinary business
hours at the physical address chosen as its domicilium citandi et executandi
shall be deemed to have been received on the day of delivery; or
16.1.5 sent by telefax to its chosen telefax number stipulated in clause
16.1, shall be deemed to have been received on the date of dispatch (unless the
contrary is proved). Notwithstanding anything to the contrary herein contained a
written notice or communication actually received by a party shall be an
adequate written notice or communication to it notwithstanding that it was not
sent to or delivered at its chosen domicilium citandi et executandi.
17. COSTS
The costs of and incidental to the drawing of this agreement and the stamp
duty hereon shall be paid by the company.
SIGNED by the parties and witnessed on the following dates and at the
following places respectively:
DATE PLACE WITNESS SIGNATURE
For: CARSON PRODUCTS
(PROPRIETARY) LIMITED
__________________
____ __________ ____________________________
__________________
1. ___________________
____ __________ ____________________________
ALLAN TOWNSEND
2. ___________________
INDEPENDENT AUDITORD' CONSENT
We consent to the incorporation by reference in Registration Statements No.
333-21141 and 333-37663 of Carson, Inc. on Form S-8 of our report dated March
18, 1998, appearing in this Annual Report of Form 10-K of Carson, Inc. for the
year ended December 31, 1997.
DELOITTE & TOUCHE LLP
Atlanta, Georgia
March 30, 1998
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from the
consolidated financial statements of the Company for the period ended December
31, 1997 and is qualified in its entirety by reference to such financial
statements.
</LEGEND>
<CURRENCY> U.S. DOLLARS
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-START> JAN-01-1997
<PERIOD-END> DEC-31-1997
<EXCHANGE-RATE> 1.0
<CASH> 14,043,000
<SECURITIES> 0
<RECEIVABLES> 32,029,000
<ALLOWANCES> 3,881,000
<INVENTORY> 24,861,000
<CURRENT-ASSETS> 67,884,000
<PP&E> 24,453,000
<DEPRECIATION> 2,251,000
<TOTAL-ASSETS> 201,424,000
<CURRENT-LIABILITIES> 22,940,000
<BONDS> 103,623,000
0
0
<COMMON> 150,000
<OTHER-SE> 61,381,000
<TOTAL-LIABILITY-AND-EQUITY> 201,424,000
<SALES> 109,631,000
<TOTAL-REVENUES> 109,631,000
<CGS> 50,510,000
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 935,000
<INTEREST-EXPENSE> 6,444,000
<INCOME-PRETAX> 6,533,000
<INCOME-TAX> 2,779,000
<INCOME-CONTINUING> 3,754,000
<DISCONTINUED> 0
<EXTRAORDINARY> 2,086,000
<CHANGES> 0
<NET-INCOME> 1,668,000
<EPS-PRIMARY> 0.11
<EPS-DILUTED> 0.11
</TABLE>
