United States v. Anheuser-Busch InBev SA/NV, Grupo Modelo S.A.B de C.V.; Proposed Final Judgment and Competitive Impact Statement, 30399-30660 [2013-11832]

Download as PDF Vol. 78 Wednesday, No. 99 May 22, 2013 Part II Department of Justice TKELLEY on DSK3SPTVN1PROD with NOTICES2 Antitrust Division United States v. Anheuser-Busch InBev SA/NV, Grupo Modelo S.A.B de C.V.; Proposed Final Judgment and Competitive Impact Statement; Notice VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00001 Fmt 4717 Sfmt 4717 E:\FR\FM\22MYN2.SGM 22MYN2 30400 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Antitrust Division United States v. Anheuser-Busch InBev SA/NV, Grupo Modelo S.A.B de C.V.; Proposed Final Judgment and Competitive Impact Statement TKELLEY on DSK3SPTVN1PROD with NOTICES2 Notice is hereby given pursuant to the Antitrust Procedures and Penalties Act, 15 U.S.C. 16(b)–(h), that a proposed Final Judgment, Stipulation and Competitive Impact Statement have been filed with the United States District Court for the District of Columbia in United States of America v. Anheuser-Busch InBev SA/NV, et al., Civil Action No. 1:13–CV–00127. On January 31, 2013, the United States filed a Complaint alleging that the proposed acquisition by Anheuser-Busch InBev SA/NV (‘‘ABI’’) of the remaining interest in Grupo Modelo S.A.B. de C.V. (‘‘Modelo’’) would violate Section 7 of the Clayton Act, 15 U.S.C. 18. The proposed Final Judgment, filed on April 19, 2013, requires ABI and Modelo to divest Modelo’s entire U.S. business to Constellation Brands, Inc. (‘‘Constellation’’), or if that transaction fails to consummate, to an alternative purchaser. Copies of the Complaint, proposed Final Judgment and Competitive Impact Statement are available for inspection at the Department of Justice, Antitrust Division, Antitrust Documents Group, 450 Fifth Street NW., Suite 1010, Washington, DC 20530 (telephone: 202– 514–2481), on the Department of Justice’s Web site at http:// www.justice.gov/atr, and at the Office of the Clerk of the United States District Court for the District of Columbia. Copies of these materials may be obtained from the Antitrust Division VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 upon request and payment of the copying fee set by Department of Justice regulations. Public comment is invited within 60 days of the date of this notice. Such comments, including the name of the submitter, and responses thereto, will be posted on the U.S. Department of Justice, Antitrust Division’s internet Web site, filed with the Court and, under certain circumstances, published in the Federal Register. Comments should be directed to James Tierney, Chief, Networks and Technology Enforcement Section, Antitrust Division, Department of Justice, 450 Fifth Street NW., Suite 7700, Washington, DC 20530, (telephone: 202–307–6200). Patricia A. Brink, Director of Civil Enforcement. United States District Court For the District of Columbia UNITED STATES OF AMERICA, U.S. Department of Justice, Antitrust Division, 450 Fifth Street NW., Suite 7100, Washington, DC 20530, Plaintiff, v. ANHEUSER–BUSCH InBEV SA/NV, Brouwerijplein 1, Leuven, Belgium 3000, and GRUPO MODELO S.A.B de C.V, Javier Barros Sierra No. 555 Piso 3, Col. Zedec, Santa Fe, Mexico D.F., C.P. 01210, Defendants. Civil Action No. 13–127 (RWR) Judge Richard W. Roberts Complaint The United States of America, acting under the direction of the Attorney General of the United States, brings this civil action under the antitrust laws of the United States to enjoin the proposed acquisition by Anheuser-Busch InBev SA/NV (‘‘ABI’’) of the remainder of PO 00000 Frm 00002 Fmt 4701 Sfmt 4725 Grupo Modelo S.A.B. de C.V. (‘‘Modelo’’) that it does not already own, and to obtain equitable and other relief as appropriate. The United States alleges as follows: I. Introduction 1. Fundamental to free markets is the notion that competition works best and consumers benefit most when independent firms battle hard to win business from each other. In industries characterized by a small number of substantial competitors and high barriers to entry, further consolidation is especially problematic and antithetical to the nation’s antitrust laws. The U.S. beer industry—which serves tens of millions of consumers at all levels of income—is highly concentrated with just two firms accounting for approximately 65% of all sales nationwide. The transaction that is the subject of this Complaint threatens competition by combining the largest and third-largest brewers of beer sold in the United States. The United States therefore seeks to enjoin this acquisition and prevent a serious violation of Section 7 of the Clayton Act. 2. Today, Modelo aggressively competes head-to-head with ABI in the United States. That competition has resulted in lower prices and product innovations that have benefited consumers across the country. The proposed acquisition would eliminate this competition by further concentrating the beer industry, enhancing ABI’s market power, and facilitating coordinated pricing between ABI and the next largest brewer, MillerCoors, LLC. The approximate market shares of U.S. beer sales, by dollars, are illustrated below: E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.000</GPH> DEPARTMENT OF JUSTICE Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices 30401 If ABI were to acquire the remainder of Modelo, this competitive constraint on ABI’s and MillerCoors’ ability to raise their prices would be eliminated. 6. The acquisition would also eliminate the substantial head-to-head competition that currently exists between ABI and Modelo. The loss of this head-to-head competition would enhance the ability of ABI to unilaterally raise the prices of the brands that it would own postacquisition, and diminish ABI’s incentive to innovate with respect to new brands, products, and packaging. 7. Accordingly, ABI’s acquisition of the remainder of Modelo would likely substantially lessen competition and is therefore illegal under Section 7 of the Clayton Act, 15 U.S.C. 18. 8. For no substantial business reason other than to avoid liability under the antitrust laws, ABI has entered into an additional transaction contingent on the approval of its acquisition of the remainder of Modelo. Specifically, ABI has agreed to sell Modelo’s existing 50% interest in Crown Imports LLC (‘‘Crown’’) 1—which currently imports Modelo beer into the United States—to Crown’s other owner, Constellation Brands, Inc. (‘‘Constellation’’). ABI and Constellation have also negotiated a proposed Amended and Restated Importer Agreement (the ‘‘supply agreement’’), giving Constellation the exclusive right to import Modelo beer into the United States for ten years. Constellation, however, would acquire no Modelo brands or brewing facilities under this arrangement—it remains simply an importer, required to depend on ABI for its supply of Modelo-branded beer. At the end of the ten-year period, ABI could unilaterally terminate its agreement with Constellation, thereby giving ABI full control of all aspects of the importation, sale, and distribution of Modelo brands in the United States. 9. The sale of Modelo’s 50% interest in Crown to Constellation is designed predominantly to help ABI win antitrust approval for its acquisition of Modelo, creating a facade of competition ¸ between ABI and its importer. In reality, Defendants’ proposed ‘‘remedy’’ eliminates from the market Modelo—a particularly aggressive competitor—and replaces it with an entity wholly dependent on ABI. As Crown’s CEO wrote to his employees after the acquisition was announced: ‘‘Our #1 competitor will now be our supplier . . . it is not currently or will not, going forward, be ‘business as usual.’ ’’ The deficiencies of the ‘‘remedy’’ are apparent from the illustrations of the pre- and post-transaction chains of supply below, demonstrating how the ‘‘remedy’’ transforms horizontal competition into vertical dependency: 1 Headquartered in Chicago, Illinois, Crown is a 50/50 joint venture between Modelo and Constellation. Crown sells and markets Modelo’s beers in the United States as the exclusive importer of Modelo beers. VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00003 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.001</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 3. Defendants’ combined national share actually understates the effect that eliminating Modelo would have on competition in the beer industry, both because Modelo’s share is substantially higher in many local areas than its national share, and because of the interdependent pricing dynamic that already exists between the largest brewers. As the two largest brewers, ABI and MillerCoors often find it more profitable to follow each other’s prices than to compete aggressively for market share by cutting price. Among other things, ABI typically initiates annual price increases in various markets with the expectation that MillerCoors’ prices will follow. And they frequently do. 4. In contrast, Modelo has resisted ABI-led price hikes. Modelo’s pricing strategy—‘‘The Momentum Plan’’— seeks to narrow the ‘‘price gap’’ between Modelo beers and lower-priced premium domestic brands, such as Bud and Bud Light. ABI internal documents acknowledge that Modelo has put ‘‘increasing pressure’’ on ABI by pursuing a competitive strategy directly at odds with ABI’s well-established practice of leading prices upward. 5. Because Modelo prices have not closely followed ABI’s price increases, ABI and MillerCoors have been forced to offer lower prices and discounts for their brands to discourage consumers from ‘‘trad[ing] up’’ to Modelo brands. 30402 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices 10. Constellation has already shown through its participation in the Crown joint venture that it does not share Modelo’s incentive to thwart ABI’s price leadership. In fact, Constellation consistently has urged following ABI’s price leadership. Given that Constellation was inclined to follow ABI’s price leadership before the acquisition, it is unlikely to reverse course after—when it would be fully dependent on ABI for its supply of beer, and will effectively be ABI’s business partner. In addition, Constellation would need to preserve a strong relationship with ABI to encourage ABI from exercising its option to terminate the agreement after 10 years. 11. For these reasons, as alleged more specifically below, the proposed acquisition, if consummated, would likely substantially lessen competition in violation of Section 7 of the Clayton Act. The likely anticompetitive effects of the proposed acquisition would not be prevented or remedied by the sale of Modelo’s existing interest in Crown to Constellation and the supply agreement between ABI and Constellation. TKELLEY on DSK3SPTVN1PROD with NOTICES2 II. Jurisdiction, Venue, and Interstate Commerce 12. The United States brings this action under Section 15 of the Clayton Act, as amended, 15 U.S.C. 25, to prevent and restrain Defendants ABI and Modelo from violating Section 7 of the Clayton Act, as amended, 15 U.S.C. 18. 13. This Court has subject matter jurisdiction over this action under Section 15 of the Clayton Act, 15 U.S.C. 25, and 28 U.S.C. 1331, 1337, and 1345. 14. Venue is proper under Section 12 of the Clayton Act, 15 U.S.C. 22, and 28 U.S.C. 1391. 15. Defendants are engaged in, and their activities substantially affect, interstate commerce. ABI and Modelo annually brew several billion dollars worth of beer, which is then advertised and sold throughout the United States. 16. This Court has personal jurisdiction over each Defendant. Modelo has consented to personal jurisdiction in this judicial district. ABI is found and transacts business in this District through its wholly-owned United States subsidiaries, over which it exercises control. III. The Defendants and the Transactions 17. ABI is a corporation organized and existing under the laws of Belgium, with headquarters in Leuven, Belgium. ABI is the largest brewer and marketer of beer sold in the United States. ABI owns and operates 125 breweries worldwide, VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 including 12 in the United States. It owns more than 200 beer brands, including Bud Light, the number one brand in the United States, and other popular brands such as Budweiser, Busch, Michelob, Natural Light, Stella Artois, Goose Island, and Beck’s. 18. Modelo is a corporation organized and existing under the laws of Mexico, with headquarters in Mexico City, Mexico. Modelo is the third-largest brewer of beer sold in the United States. Modelo’s Corona Extra brand is the topselling import in the United States. Its other popular brands sold in the United States include Corona Light, Modelo Especial, Negra Modelo, Victoria, and Pacifico. 19. ABI currently holds a 35.3% direct interest in Modelo, and a 23.3% direct interest in Modelo’s operating subsidiary Diblo, S.A. de C.V. ABI’s current part-ownership of Modelo gives ABI certain minority voting rights and the right to appoint nine members of Modelo’s 19-member Board of Directors. However, as ABI stated in its most recent annual report, ABI does ‘‘not have voting or other effective control of . . . Grupo Modelo.’’ 20. ABI and Modelo executives agree that there is currently vigorous competition between the ABI and Modelo brands in the United States. Indeed, firewalls are in place to ensure that the ABI members of Modelo’s Board do not become privy to information about the pricing, marketing, or distribution of Modelo brands in the United States. 21. Modelo executives run its day-today business, including Modelo’s relationship and interaction with its U.S. importer, Crown. Modelo owns half of Crown and may exercise an option at the end of 2013, to acquire in 2016, the half of Crown it does not already own. Today, Modelo must approve Crown’s general pricing parameters, changes in strategic direction, borrowing activities, and capital investment above certain thresholds. Modelo also sets the global strategic themes for the brands it owns. Essentially, Crown is a group of employees who report to Crown’s owners: Modelo and Constellation. 22. The acquisition gives complete control of Modelo to ABI, and gives ABI full access to competitively sensitive information about the sale of the Modelo brands in the United States— access that ABI does not currently enjoy. ABI presently has no day-to-day role in Modelo’s United States business and is walled off from strategic discussions regarding Modelo sales in the United States. 23. On June 28, 2012, ABI agreed to purchase the remaining equity interest PO 00000 Frm 00004 Fmt 4701 Sfmt 4703 from Modelo’s owners, thereby obtaining full ownership and control of Modelo, for about $20.1 billion. 24. As noted above, in an effective acknowledgement that the acquisition of Modelo raises significant competitive concerns, Defendants simultaneously entered into another transaction in an attempt to ‘‘remedy’’ the competitive harm caused by ABI’s acquisition of the remainder of Modelo: ABI has agreed to sell Modelo’s existing 50% interest in Crown to Constellation, so that Crown, previously a joint-venture between Modelo and Constellation, would become wholly owned by Constellation. As part of this strategy, ABI and Constellation have negotiated a supply agreement giving Constellation the exclusive right to import Modelo beer into the United States for ten years. These transactions are contingent on the closing of ABI’s acquisition of Modelo. IV. The Relevant Market A. Description of the Product 25. ‘‘Beer’’ is comprised of a wide variety of brands of alcoholic beverages usually made from a malted cereal grain, flavored with hops, and brewed via a process of fermentation. Beer is substantially differentiated from other alcoholic beverages by taste, quality, alcohol content, image, and price. 26. In addition to brewing, beer producers typically also sell, market, and develop multiple brands. Marketing and brand building take various forms including sports sponsorships, print advertising, national television campaigns, and increasingly, online marketing. For example, Modelo has recently invested in ‘‘more national advertising [and] more national sports’’ in order to ‘‘build the equity of [its] brands.’’ 27. Most brewers use distributors to merchandise, sell, and deliver beer to retailers. Those end accounts are primarily grocery stores, large retailers such as Target and Walmart, and convenience stores, liquor stores, restaurants, and bars which, in turn, sell beer to the consumer. Beer brewed in foreign countries may be sold to an importer, which then arranges for distribution to retailers. 28. ABI groups beer into four segments: Sub-premium, premium, premium plus, and high-end. The subpremium segment, also referred to as the value segment, generally consists of lager beers, such as Natural and Keystone branded beer, and some ales and malt liquors, which are priced lower than premium beers, made from less expensive ingredients and are generally perceived as being of lower E:\FR\FM\22MYN2.SGM 22MYN2 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices quality than premium beers. The premium segment generally consists of medium-priced American lager beers, such as ABI’s Budweiser, and the Miller and Coors brand families, including the ‘‘light’’ varieties. The premium plus segment consists largely of American beers that are priced somewhat higher than premium beers, made from more expensive ingredients and are generally perceived to be of superior quality. Examples of beers in the premium plus category include Bud Light Lime, Bud Light Platinum, Bud Light Lime-a-Rita and Michelob Ultra. 29. The high-end category includes craft beers, which are often produced in small-scale breweries, and imported beers. High-end beers sell at a wide variety of price points, most of which are higher than premium and premium plus beers. The high-end segment includes craft beers such as Dogfish Head, Flying Dog, and also imported beers, the best selling of which is Modelo’s Corona. ABI also owns highend beers including Stella Artois and Goose Island. Brewers with a broad portfolio of brands, such as ABI, seek to maintain ‘‘price gaps’’ between each segment. For example, premium beer is priced above sub-premium beer, but below premium plus beer. 30. Beers compete with one another across segments. Indeed, ABI and Modelo brands are in regular competition with one another. For example, Modelo, acting through Crown in the United States, usually selects ‘‘[d]omestic premium’’ beer, namely, ABI’s Bud Light, as its benchmark for its own brands’ pricing. B. Relevant Product Market TKELLEY on DSK3SPTVN1PROD with NOTICES2 31. Beer is a relevant product market and line of commerce under Section 7 of the Clayton Act. Other alcoholic beverages, such as wine and distilled spirits, are not sufficiently substitutable to discipline at least a small but significant and nontransitory increase in the price of beer, and relatively few consumers would substantially reduce their beer purchases in the event of such a price increase. Therefore, a hypothetical monopolist producer of beer likely would increase its prices by at least a small but significant and nontransitory amount. C. Relevant Geographic Market 32. The 26 local markets, defined by Metropolitan Statistical Areas (‘‘MSAs’’),2 identified in Appendix A, are relevant geographic markets for antitrust purposes. Each of these local markets currently benefits from head-tohead competition between ABI and Modelo, and in each the acquisition would likely substantially lessen competition. 33. The relevant geographic markets for analyzing the effects of this acquisition are best defined by the locations of the customers who purchase beer, rather than by the locations of breweries. Brewers develop pricing and promotional strategies based on an assessment of local demand for their beer, local competitive conditions, and local brand strength. Thus, the price for a brand of beer can vary by local market. 34. Brewers are able to price differently in different locations, in part, because arbitrage across local markets is unlikely to occur. Consumers buy beer near their homes and typically do not travel to other areas to buy beer when prices rise. Also, distributors’ contracts with brewers and their importers contain territorial limits and prohibit distributors from reselling beer outside their territories. In addition, each state has different laws and regulations regarding beer distribution and sales that would make arbitrage difficult. 35. Accordingly, a hypothetical monopolist of beer sold into each of the local markets identified in Appendix A would likely increase its prices in that local market by at least a small but significant and non-transitory amount. 36. Therefore, the MSAs identified in Appendix A are relevant geographic markets and ‘‘sections of the country’’ within the meaning of Section 7 of the Clayton Act. 37. There is also competition between brewers on a national level that affects local markets throughout the United States. Decisions about beer brewing, marketing, and brand building typically take place on a national level. In addition, most beer advertising is on national television, and brewers commonly compete for national retail accounts. General pricing strategy also typically originates at a national level. A hypothetical monopolist of beer sold in the United States would likely increase its prices by at least a small but significant and non-transitory amount. Accordingly, the United States is a relevant geographic market under Section 7 of the Clayton Act. defined by the SymphonyIRI Group, a market research firm, whose data is commonly used by industry participants. 21:24 May 21, 2013 Jkt 229001 PO 00000 V. ABI’S Proposed Acquisition Is Likely To Result in Anticompetitive Effects A. The Relevant Markets are Highly Concentrated and the Merger Triggers a Presumption of Illegality in Each Relevant Market 38. The relevant markets are highly concentrated and would become significantly more concentrated as a result of the proposed acquisition. 39. ABI is the largest brewer of beer sold in the United States. MillerCoors is the second-largest brewer of beer sold in the United States. MillerCoors owns the Miller and Coors brands and also many smaller brands including Blue Moon and Keystone Light. Modelo is the thirdlargest brewer of beer sold in the United States, with annual U.S. sales of $2.47 billion, 7% market share nationally, and a market share that is nearly 20% in some local markets. Modelo owns the Corona, Modelo, Pacifico, and Victoria brands. The remaining sales of beer in the U.S. are divided among Heineken and fringe competitors, including many craft brewers, which the Defendants characterize as being ‘‘fragmented . . . small player[s].’’ 40. Concentration in relevant markets is typically measured by the HerfindahlHirschman Index (‘‘HHI’’). Market concentration is often one useful indicator of the level of competitive vigor in a market and the likely competitive effects of a merger. The more concentrated a market, and the more a transaction would increase concentration in a market, the more likely it is that a transaction would result in a meaningful reduction in competition. Markets in which the HHI is in excess of 2,500 points are considered highly concentrated. 41. The beer industry in the United States is highly concentrated and would become substantially more so as a result of this acquisition. Market share estimates demonstrate that in 20 of the 26 local geographic markets identified in Appendix A, the post-acquisition HHI exceeds 2,500 points, in one market is as high as 4,886 points, and there is an increase in the HHI 3 of at least 472 points in each of those 20 markets. In six of the local geographic markets, the post-merger HHI is at least 1,822, with an increase of the HHI of at least 387 points, and in each of those six markets the parties combined market share is greater than 30%. 42. In the United States, the Defendants will have a combined 3 Even if these concentration measures are modified to reflect ABI’s current partial ownership of Modelo, the effective levels of concentration would still support a presumption of illegality. 2 As VerDate Mar<15>2010 30403 Frm 00005 Fmt 4701 Sfmt 4703 E:\FR\FM\22MYN2.SGM 22MYN2 30404 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices market share of approximately 46% post-transaction. The post-transaction HHI of the United States beer market will be greater than 2800, with an increase in the HHI of 566. 43. The market concentration measures, coupled with the significant increases in concentration, described above, demonstrate that the acquisition is presumed to be anticompetitive. B. Beer Prices in the United States Today are Largely Determined by the Strategic Interactions of ABI, MillerCoors, and Modelo TKELLEY on DSK3SPTVN1PROD with NOTICES2 1. ABI’s Price Leadership 44. ABI and MillerCoors typically announce annual price increases in late summer for execution in early fall. The increases vary by region, but typically cover a broad range of beer brands and packs. In most local markets, ABI is the market share leader and issues its price announcement first, purposely making its price increases transparent to the market so its competitors will get in line. In the past several years, MillerCoors has followed ABI’s price increases to a significant degree. 45. The specifics of ABI’s pricing strategy are governed by its ‘‘Conduct Plan,’’ a strategic plan for pricing in the United States that reads like a how-to manual for successful price coordination. The goals of the Conduct Plan include: ‘‘yielding the highest level of followership in the short-term’’ and ‘‘improving competitor conduct over the long-term.’’ 46. ABI’s Conduct Plan emphasizes the importance of being ‘‘Transparent— so competitors can clearly see the plan;’’ ‘‘Simple—so competitors can understand the plan;’’ ‘‘Consistent—so competitors can predict the plan;’’ and ‘‘Targeted—consider competition’s structure.’’ By pursuing these goals, ABI seeks to ‘‘dictate consistent and transparent competitive response.’’ As one ABI executive wrote, a ‘‘Front Line Driven Plan sends Clear Signal to Competition and Sets up well for potential conduct plan response.’’ According to ABI, its Conduct Plan ‘‘increases the probability of [ABI] sustaining a price increase.’’ 47. The proposed merger would likely increase the ability of ABI and the remaining beer firms to coordinate by eliminating an independent Modelo— which has increasingly inhibited ABI’s price leadership—from the market. 2. Modelo Has Constrained ABI’s Ability to Lead Prices Higher 48. In the past several years, Modelo, acting through Crown, has disrupted ABI’s pricing strategy by declining to VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 match many of the price increases that were led by ABI and frequently joined by MillerCoors. 49. In or around 2008, Crown implemented its ‘‘Momentum Plan’’ with Modelo’s enthusiastic support. The Momentum Plan is specifically designed to grow Modelo’s market share by shrinking the price gaps between brands owned by Modelo and domestic premium brands. By maintaining steady pricing while the prices of premium beer continues to rise, Modelo has narrowed the price gap between its beers and ABI’s premium beers, encouraging consumers to trade up to Modelo brands. These narrowed price gaps frustrate ABI and MillerCoors because they result in Modelo gaining market share at their expense. 50. Under the Momentum Plan, Modelo brand prices essentially remained flat despite price increases from ABI and other competitors, allowing Modelo brands to achieve their targeted price gaps to premium beers in various markets. After Modelo implemented its price gap strategy, Modelo brands experienced market share growth. 51. Because of the Momentum Plan, prices on the Modelo brands have increased more slowly than ABI has increased premium segment prices. Thus, as ABI has observed, in recent years, the ‘‘gap between Premium and High End has been reducing . . . due to non [high-end] increases.’’ Over the same time period, the high-end segment has been gaining market share at the expense of ABI’s and MillerCoors’ premium domestic brands. 52. In internal strategy documents, ABI has repeatedly complained about pressure resulting from price competition with the Modelo brands: ‘‘Recent price actions delivered expected Trade up from Sub Premium, however it created additional share pressure from volume shifting to High End where we under-index;’’ ‘‘Consumers switching to High End accelerated by price gap compression;’’ ‘‘While relative Price to MC [MillerCoors] has remained stable the lack of Price increase in Corona is increasing pressure in Premium.’’ An ABI presentation from November 2011 stated that ABI’s strategy was ‘‘ShortTerm []: We must slow the volume trend of High End Segment and cannot let the industry transform.’’ Owning the Modelo brands will enable ABI to implement that strategy. 53. The competition that Modelo has created by not following ABI price increases has constrained ABI’s ability to raise prices and forced ABI to become more competitive by offering innovative PO 00000 Frm 00006 Fmt 4701 Sfmt 4703 brands and packages to limit its share losses and to attract customers. 54. Competition between the ABI and Modelo brands has become increasingly intense throughout the country, particularly in areas with large Latino populations. As the country’s Latino population is forecasted to grow over time, ABI anticipates even more rigorous competition with Modelo. Here are some examples of how the Modelo brands have disciplined the pricing of the market leaders. a. California 55. Modelo, acting through Crown, has not followed ABI-led price increases in local markets in California. Because of the aggressive pricing of the Modelo brands, ABI’s Bud and Bud Light brands have reported ‘‘[h]eavy share losses’’ to Modelo’s Corona and Modelo Especial. 56. Consumers in California markets have been the beneficiaries of Modelo’s aggressive pricing. ABI rescinded a planned September 2010 price increase because of the share growth of Modelo’s Corona brand. ABI also considered launching a new line, ‘‘Michelob Especial,’’—a Modelo brand is ‘‘Modelo Especial’’—targeted at California’s Latino community. ABI recognized that Corona’s strength in California meant that ‘‘innovation [is] required.’’ Nonetheless, Modelo continued ‘‘eating [Budweiser’s] lunch’’ in California to the point where ABI’s Vice President of Sales observed that ‘‘California is a burning platform’’ for ABI, which was ‘‘losing share’’ because of ‘‘price compression’’ between ABI and Corona. 57. In 2012, ABI’s concern about losing market share to Modelo in California caused a full-blown price war. ABI implemented ‘‘aggressive price reductions . . .’’ that were seen as ‘‘specifically targeting Corona and Modelo.’’ These aggressive discounts appear to have been taken in support of ABI’s expressed desire to discipline Modelo’s aggressive pricing with the ultimate goal of ‘‘driv[ing] them to go up’’ in price. Both MillerCoors and Modelo followed ABI’s price decrease, and ABI responded by dropping its price even further to stay competitive. b. Texas 58. Competition between the ABI and Modelo brands in local markets in Texas is also intense. Beginning in or about 2010, some Modelo brands began to be priced competitively with ABI’s Bud Light, the leading domestic brand throughout the state. Modelo brands also benefited from price promotions and regional advertising. By 2011, Modelo had begun gaining market share at ABI’s expense. ABI recognized E:\FR\FM\22MYN2.SGM 22MYN2 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Modelo’s aggressive price strategy as an issue contributing to its market share loss. 59. Ultimately, aggressive pricing on some Modelo brands forced ABI to lower its prices in local Texas markets, and adjust its marketing strategy to better respond to competition from the Modelo brands. According to an ABI Regional Vice President of Sales, ABI set ‘‘pricing, packaging and retail activity targets to address [Modelo’s] Especial’’ brand. In both Houston and San Antonio, ABI also lowered the price of its Bud Light Lime brand to match Modelo Especial price moves. TKELLEY on DSK3SPTVN1PROD with NOTICES2 c. New York City 60. In the summer of 2011, Modelo, acting through Crown, sought to narrow the gap in price between its brands and those of domestic premiums, including the ABI brands in New York City. ABI became concerned that ‘‘price compression on Premiums by imports’’ would cause premium domestic customers to trade up to the import segment. ABI’s Vice President of Sales observed that the price moves on Modelo’s Corona brand, and corresponding reductions by MillerCoors and Heineken, meant that ABI would ‘‘need to respond in some fashion,’’ and that its planned price increase was ‘‘in jeopardy.’’ ABI ultimately chose to respond by delaying a planned price increase to ‘‘limit the impact of price compression on our premiums as a result of the Corona . . . deeper discount.’’ C. The Elimination of Modelo Would Likely Result in Higher Coordinated Pricing by ABI and MillerCoors 61. Competition spurred by Modelo has benefitted consumers through lower beer prices and increased innovation. It has also thwarted ABI’s vision of leading industry prices upward with MillerCoors and others following. As one ABI executive stated in June 2011, ‘‘[t]he impact of Crown Imports not increasing price has a significant influence on our volume and share. The case could be made that Crown’s lack of increases has a bigger influence on our elasticity than MillerCoors does.’’ ABI’s acquisition of full ownership and control of Modelo’s brands and brewing assets will facilitate future pricing coordination. D. The Loss of Head-to-Head Competition Between ABI and Modelo Would Likely Result in Higher Prices on ABI-Owned Brands 62. ABI is intent on moderating price competition. As it has explained internally: ‘‘We must defend from value- VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 destroying pricing by: [1] Ensuring competition does not believe they can take share through pricing[,] [and] [2] Building discipline in our teams to prevent unintended initiation or acceleration of value-destroying actions.’’ ABI documents show that it is increasingly worried about the threat of high-end brands, such as Modelo’s, constraining its ability to increase premium and sub-premium pricing. In general, ABI, as the price leader, would prefer a market not characterized by aggressive pricing actions to take share because ‘‘[t]aking market share this way is unsustainable and results in lower total industry profitability which damages all players long-term.’’ 63. ABI would have strong incentives to raise the prices of its beers were it to acquire Modelo. First, lifting the price of Modelo beers would allow ABI to further increase the prices of its existing brands across all beer segments. Second, as the market leader in the premium and premium-plus segments, and as a brewer with an approximate overall national share of approximately 46% of beer sales post-acquisition, coupled with its newly expanded portfolio of brands, ABI stands to recapture a significant portion of any sales lost due to such a price increase, because a significant percentage of those lost sales will go to other ABI-owned brands. 64. Therefore, ABI likely would unilaterally raise prices on the brands of beer that it owns as a result of the acquisition. E. The Loss of Head-to-Head Competition Between ABI and Modelo Will Harm Consumers Through Reduced New Product Innovation and Product Variety 65. Modelo’s growth in the United States has repeatedly spurred product innovation by ABI. In 2011, ABI decided to ‘‘Target Mexican imports’’ and began planning three related ways of doing so. First, ABI would acquire the U.S. sales rights to Presidente beer, the number one beer in Central America, and greatly expand Presidente’s distribution in the United States. Second, ABI would acquire a ‘‘Southern US or Mexican craft brand,’’ and use it to compete against Mexican imports. Finally, ABI would license trademarks to another tropical-style beer, in a project that the responsible ABI manager described as a ‘‘Corona killer.’’ 66. ABI’s Bud Light Lime, launched in 2008, was also targeted at Corona (commonly served with a slice of lime), going so far as to mimic Corona’s distinctive clear bottle. As one Modelo executive noted after watching a commercial for Bud Light Lime, the PO 00000 Frm 00007 Fmt 4701 Sfmt 4703 30405 product was ‘‘invading aggressively and directly the Corona territory.’’ Another executive commented that the commercial itself was ‘‘[v]ery similar’’ to one Modelo, through Crown, was developing at the same time. 67. The proposed acquisition’s harmful effect on product innovation is already evident. If ABI were to acquire Modelo and enter into the supply agreement with Constellation, ABI would be forbidden from launching a ‘‘Mexican-style Beer’’ in the United States. Further, ABI would no longer have the same incentives to introduce new brands to take market share from the Modelo brands. F. Summary of Competitive Harm From ABI’s Acquisition of the Remainder of Modelo 68. The significant increase in market concentration that the proposed acquisition would produce in the relevant markets, combined with the loss of head-to-head competition between ABI and Modelo, is likely to result in unilateral price increases by ABI and to facilitate coordinated pricing between ABI and remaining market participants. VI. Absence of Countervailing Factors 69. New entry and expansion by existing competitors are unlikely to prevent or remedy the acquisition’s likely anticompetitive effects. Barriers to entry and expansion within each of these harmed markets include: (i) The substantial time and expense required to build a brand reputation; (ii) the substantial sunk costs for promotional and advertising activity needed to secure the distribution and placement of a new entrant’s beer products in retail outlets; (iii) the difficulty of securing shelf-space in retail outlets; (iv) the time and cost of building new breweries and other facilities; and (v) the time and cost of developing a network of beer distributors and delivery routes. 70. Although ABI asserts that the acquisition would produce efficiencies, it cannot demonstrate acquisitionspecific and cognizable efficiencies that would be passed-through to U.S. consumers, of sufficient size to offset the acquisition’s significant anticompetitive effects. VII. Defendants’ Proffered ‘‘Remedy’’ Does Not Prevent the Anticompetitive Effect of ABI’s Acquisition of Modelo 71. In light of the high market concentration, and substantial likelihood of anticompetitive effects, ABI’s acquisition of the remainder of Modelo is illegal. Defendants thus evidently structured their transactions E:\FR\FM\22MYN2.SGM 22MYN2 30406 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices TKELLEY on DSK3SPTVN1PROD with NOTICES2 with a purported ‘‘remedy’’ in mind: the sale of Modelo’s interest in Crown to Constellation, coupled with a supply agreement that gives Constellation the right to import Modelo beer into the United States. This proposal is inadequate to remedy Defendants’ violation of Section 7 of the Clayton Act. A. Constellation Has Not Shown Modelo and Crown’s Past Willingness To Resist ABI’s ‘‘Leader-Follower’’ Industry Plan 72. Constellation has not shown Crown and Modelo’s past willingness to thwart ABI’s price leadership. While Modelo supported narrowing the gap between the prices of its brands and those of ABI premium brands, Constellation’s executives have sought to follow ABI’s pricing lead. In August 2011, Constellation’s Managing Director wrote to Crown’s CEO: ‘‘Since ABI has already announced an October general price increase I was wondering if you are considering price increases for the Modelo portfolio? . . .. From a positioning and image perspective I believe it would be a mistake to allow the gaps to be narrowed . . . I think ABI’s announcement gives you the opportunity to increase profitability without having to sacrifice significant volume.’’ Similarly, in December of 2011, Constellation’s CFO wrote to his counterpart at Crown that he thought price increases on the Modelo brands were viable ‘‘if domestics [i.e. Bud and Bud Light] keep going up’’ but worried that ‘‘Modelo gets a vote as well.’’ And in June of 2012, a Crown executive stated that Constellation’s plan for annual price increases ‘‘put at risk the relative success’’ of the Momentum Plan. 73. Crown executives have recognized the differing incentives, as it relates to pricing, of their two owners. As one Crown executive observed in a March 2011 email, ‘‘Modelo has a higher interest in building volume so that they can cover manufacturing costs, gain manufacturing profits and build share as the brand owners.’’ Constellation, however, ‘‘is interested primarily in the financial return on a short-term or at the most on a mid-term basis.’’ 74. Post-transaction, Constellation would no longer be so constrained. Even if Crown’s own executives wanted to continue an aggressive pricing strategy, they would be required to answer to Crown’s new sole owner—Constellation. 75. Crown executives were concerned about what would happen if Constellation gained complete control of Crown. Crown’s CEO wrote to Constellation’s CEO after Defendants’ proposed ‘‘remedy’’ was announced: VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 ‘‘the Crown team [] is extremely anxious about this change in ownership. This is in no small part the result of Constellation’s actions over the term of the joint venture to limit investment in the business in the areas of manpower and marketing.’’ Constellation’s CEO responded internally: ‘‘[Q]uite something. I see a management issue brewing.’’ In another email, Crown’s CEO wrote to his employees that Constellation had been ‘‘consistently non supportive of the business through Crown’s history . . . seeking to drive profits at all costs.’’ 76. Crown’s fears appear wellgrounded. In 2010, Modelo sued Constellation for breach of fiduciary duty, after Constellation had refused to invest in marketing the Modelo brands. In its Complaint, Modelo alleged ‘‘Constellation [] knew that [Crown] management’s plan was in Crown’s best interests, but they blocked it anyway in an effort to secure unwarranted benefits for Constellation.’’ 77. Post-acquisition, Constellation would not need to ask Modelo for permission to follow ABI’s priceleadership. Instead, Constellation would be free to follow ABI’s lead. Moreover, ABI and Constellation will have every incentive to act together on pricing because of the vast profits each would stand to make if beer prices were to increase. 78. The contingent supply relationship between ABI and Constellation would also facilitate joint pricing between the two companies. Post-acquisition, there would be day-today interaction between ABI and Constellation on matters such as volume, packaging, transportation of product, and new product innovation. ABI and Constellation would have countless opportunities that could creatively be exploited, and that no one could predict or control, to allow ABI to reward Constellation (or refrain from punishing Constellation) in exchange for Constellation raising the price of the Modelo brands. The lucrative supply agreement from which Constellation seeks to gain billions of dollars in profits itself incentivizes Constellation to keep ABI happy to avoid terminating Constellation’s rights in ten years. 79. ABI and Constellation are more likely to decide on mutually profitable pricing. Unlike ABI and Modelo, which are horizontal competitors, Constellation would be a mere participant in ABI’s supply chain under the proposed arrangement. 80. ABI and Modelo have sought to avoid acting together on matters of competitive significance in the relevant markets in the U.S. Accordingly, they PO 00000 Frm 00008 Fmt 4701 Sfmt 4703 have built in several firewalls— including ABI’s exclusion from sensitive portions of Modelo board meetings concerning the sale of Modelo beer in the U.S.—to insulate ABI from Modelo’s U.S. business. Postacquisition, those firewalls would be gone. 81. The loss of Modelo also, by itself, facilitates interdependent pricing. Today, ABI would need to reach agreement with both Modelo and Constellation to ensure that pricing for the Modelo brands followed ABI’s lead. After the proposed transactions, working together on price would be easier because only Constellation would need to follow or agree with ABI. B. Constellation Will Not Be an Independent Firm Capable of Restoring Head-To-Head Competition Between ABI and Modelo 82. Even if Constellation wanted to act at odds with ABI post-transaction, it would be unlikely to do so. Constellation will own no brands or brewing or bottling assets of its own. It would be dependent on ABI for its supply. Thus, Defendants’ proposed remedy puts Constellation in a considerably weaker competitive position compared to Modelo, which owns both brands and breweries. 83. ABI could terminate the contingent supply agreement at any time. And if ABI is displeased with Constellation’s strategy in the United States, it might simply withhold or delay supply to punish Constellation. 84. The supply agreement may also be renegotiated at any time during the 10year period. Thus, it provides no guaranteed protection for consumers that any of its terms will be followed if ABI is able to secure antitrust approval for this acquisition. VIII. Violations Alleged 85. The United States incorporates the allegations of paragraphs 1 through 84 above as if set forth fully herein. Violation of Clayton Act § 7, 15 U.S.C. 18 ABI Agreement To Acquire Remainder of Modelo 86. The proposed acquisition of the remainder of Modelo by ABI would likely substantially lessen competition—even after Defendants’ proposed ‘‘remedy’’—in the relevant markets, in violation of Section 7 of the Clayton Act, 15 U.S.C. 18. The transactions would have the following anticompetitive effects, among others: (a) Eliminating Modelo as a substantial, independent, and E:\FR\FM\22MYN2.SGM 22MYN2 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices competitive force in the relevant markets, creating a combined firm with reduced incentives to lower price or increase innovation or quality; (b) Competition generally in the relevant markets would likely be substantially lessened; (c) Prices of beer would likely increase to levels above those that would prevail absent the transaction, forcing millions of consumers in the United States to pay higher prices; (d) Quality and innovation would likely be less than levels that would prevail absent the transaction; (e) The acquisition would likely promote and facilitate pricing coordination in the relevant markets; and (f) The acquisition would provide ABI with a greater incentive and ability to increase its pricing unilaterally. IX. Request for Relief TKELLEY on DSK3SPTVN1PROD with NOTICES2 87. The United States requests that: (a) The proposed acquisition be adjudged to violate Section 7 of the Clayton Act, 15 U.S.C. 18; (b) The Defendants be permanently enjoined and restrained from carrying out the Agreement and Plan of Merger dated June 28, 2012, and the VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 ‘‘Transaction Agreement’’ dated June 28, 2012, between Modelo, Diblo, and ABI, or from entering into or carrying out any agreement, understanding, or plan by which ABI would acquire the remaining interest in Modelo, its stock, or any of its assets; (c) The United States be awarded costs of this action; and (d) The United States be awarded such other relief as the Court may deem just and proper. JAMES J. TIERNEY (D.C. BAR # 434610), Chief. N. SCOTT SACKS (D.C. BAR # 913087) Acting Assistant Chief. NETWORKS & TECHNOLOGY ENFORCEMENT SECTION /s/ lllllllllllllllllll MICHELLE R. SELTZER* (D.C. BAR # 475482), Attorney. LITIGATION I Antitrust Division, U.S. Department of Justice, 450 Fifth Street NW., Suite 4100, Washington, DC 20530, Telephone: (202) 353–3865, Facsimile: (202) 307–5802, E-mail: michelle.seltzer@usdoj.gov. SANFORD ADLER JANET BRODY TRAVIS R. CHAPMAN JOHN C. FILIPPINI (DC BAR # 165159) DAVID Z. GRINGER DANIELLE G. HAUCK DAVID C. KELLY ANURAG MAHESHWARY (DC BAR # 490535) LOWELL STERN (DC BAR # 440487) MARY STRIMEL(DC BAR # 455303) RYAN STRUVE (DC BAR # 495406) SHANE WAGMAN Attorneys for the United States *Attorney of Record Dated this 31st day of January 2013. Respectfully submitted, FOR PLAINTIFF UNITED STATES: /s/ lllllllllllllllllll WILLIAM J. BAER (D.C. BAR # 324723), Assistant Attorney General for Antitrust. /s/ lllllllllllllllllll RENATA B. HESSE (D.C. BAR # 466107), Deputy Assistant Attorney General. /s/ lllllllllllllllllll PATRICIA A. BRINK, Director of Civil Enforcement. /s/ lllllllllllllllllll MARK W. RYAN (D.C. BAR # 359098), Director of Litigation. /s/ lllllllllllllllllll JOSEPH J. MATELIS (D.C. BAR # 462199), Chief Counsel for Innovation. /s/ lllllllllllllllllll Appendix A PO 00000 Frm 00009 Fmt 4701 Sfmt 4703 30407 E:\FR\FM\22MYN2.SGM 22MYN2 30408 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Relevant Geographic Markets and Concentration Data Combined Market Share PostMerger HHI Delta HHI Salt Lake City, UT 57 3900 739 Houston, TX 55 3660 840 Minneapolis/St Paul, MN 50 3525 733 Birmingham/Montgomery, AL 52 3408 503 Las Vegas, NV 49 3332 832 Orlando, FL 51 3273 570 Phoenix/Tucson, AZ 48 3139 564 Miami/Ft Lauderdale, FL 48 3067 964 Richmond/Norfolk, VA 48 3044 472 New York, NY 43 2504 778 Sacramento, CA 40 2382 697 San Diego, CA 39 2242 651 San Francisco/Oakland, CA 34 1822 563 United States District Court for the District of Columbia United States of America, Plaintiff, v. Anheuser-Busch InBEV SA/NV, et al., Defendants. Civil Action No. 13–127 (RWR) Judge Richard W. Roberts VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 Competitive Impact Statement Pursuant to Section 2(b) of the Antitrust Procedures and Penalties Act (‘‘APPA’’ or ‘‘Tunney Act’’), 15 U.S.C. 16(b)–(h), Plaintiff United States of America (‘‘United States’’) files this Competitive Impact Statement relating to the proposed Final Judgment PO 00000 Frm 00010 Fmt 4701 Sfmt 4703 submitted on April 19, 2013, for entry in this civil antitrust proceeding. I. Nature and Purpose of the Proceeding On June 28, 2012, Defendant Anheuser-Busch InBev SA/NV (‘‘ABI’’) agreed to purchase the remaining equity interest in Defendant Grupo Modelo, S.A.B. de C.V. (‘‘Modelo’’) for approximately $20.1 billion. The United E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.002</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 Market TKELLEY on DSK3SPTVN1PROD with NOTICES2 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices States filed a civil antitrust Complaint against ABI and Modelo on January 31, 2013, seeking to enjoin the proposed acquisition. The Complaint alleges that the likely effect of this acquisition would be to lessen competition substantially for beer in the United States and specifically in twenty-six local markets in violation of Section 7 of the Clayton Act, 15 U.S.C. 18. This loss of competition would likely result in higher beer prices and less innovation. On April 19, 2013, the United States filed an Explanation of Consent Decree Procedures, which included a Stipulation and Order and a proposed Final Judgment as exhibits that are collectively designed to eliminate the anticompetitive effects that the acquisition would have otherwise caused. The proposed Final Judgment, which is explained more fully below, will accomplish the complete divestiture of Modelo’s U.S. business to Modelo’s current joint venture partner, Constellation Brands, Inc. (‘‘Constellation’’), or, if that transaction fails to close, to another acquirer capable of replacing the competition that Modelo currently brings to the United States market. This structural fix will maintain Modelo Brand Beers 4 as independent competitors to ABI’s flagship brands in the United States and will eliminate the existing entanglements between ABI and Modelo ` vis-a-vis the beer market in the United States. Specifically, under the proposed Final Judgment, ABI is required to divest and/ or license to Constellation (or to an alternative purchaser if the sale to Constellation for some reason does not close) certain tangible and intangible assets (hereafter the ‘‘Divestiture Assets’’), including: • A perpetual and exclusive United States license to Corona Extra, this country’s best-selling imported beer and #5 brand overall, and to nine other Modelo Brand Beers including Corona Light, Modelo Especial, Negra Modelo, and Pacifico; • Modelo’s newest, most technologically advanced brewery (the ‘‘Piedras Negras Brewery’’), which is located in Mexico near the Texas border, and the assets and companies associated with it;5 • Modelo’s limited liability membership interest in Crown Imports, LLC (‘‘Crown’’), the joint venture established by Modelo and Constellation to import, market, and sell certain Modelo beers into the United States; and • Other assets, rights, and interests necessary to ensure that Constellation (or an alternative purchaser) is able to compete in the beer market in the United States using the Modelo Brand Beers, independent of a relationship with ABI and Modelo. Under the terms of the Stipulation and Order, Constellation will be added as a Defendant for purposes of settlement,6 and ABI, Modelo, and Constellation will take certain steps to operate Crown, the Piedras Negras Brewery, and the other Divestiture Assets as competitively independent, economically viable, and ongoing assets whose commercial activities will remain uninfluenced by ABI until the sale to Constellation has closed. In order to guarantee that the acquirer of the Divestiture Assets will be able to supply Modelo Brand Beer to the United States market independent of ABI, the proposed Final Judgment contains provisions designed to ensure that Constellation (or an alternative acquirer) will have sufficient brewing capacity to meet current and future demand for Modelo Brand Beer in the United States. Because the Piedras Negras Brewery currently produces enough Modelo Brand Beer to serve only approximately 60% of present U.S. demand, Constellation has committed to build out and expand the Piedras Negras Brewery to brew and package sufficient quantities of Corona, Modelo Especial, and other Modelo Brand Beer to meet the large and growing demand for these beers in the United States. This expansion is included as a direct requirement under the proposed Final Judgment and will assure Constellation’s future independence as a self-supplied brewer and seller in the United States beer market. The United States and Defendants have stipulated that the proposed Final Judgment may be entered after compliance with the APPA. Entry of the proposed Final Judgment would terminate this action, except that the Court would retain jurisdiction to construe, modify, or enforce the provisions of the proposed Final Judgment and to punish violations thereof. 4 Capitalized terms in this Competitive Impact Statement are defined in the proposed Final Judgment. 5 The Piedras Negras Brewery is owned by a ˜ subsidiary of Modelo—Compania Cervecera de Coahuila S.A. de C.V., which will be transferred as part of the divestiture. 6 As discussed further below and in Section III.B herein, Constellation will be joined as a settling Defendant because it will be required, as a condition of acquiring the Divestiture Assets, to complete an expansion of the Piedras Negras Brewery to serve current and future United States demand. VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00011 Fmt 4701 Sfmt 4703 30409 II. Description of the Events Giving Rise to the Alleged Violation A. The Defendants and the Proposed Transaction ABI is a corporation organized and existing under the laws of Belgium, with headquarters in Leuven, Belgium. ABI brews and markets more beer sold in the United States than any other firm, with a 39% market share nationally. ABI owns and operates 125 breweries worldwide, including 12 in the United States. It owns more than 200 different beer brands, including Bud Light, the highest selling brand in the United States, and other popular brands such as Budweiser, Busch, Michelob, Natural Light, Stella Artois, Goose Island, and Beck’s. Modelo is a corporation organized and existing under the laws of Mexico, with headquarters in Mexico City, Mexico. Modelo is the third-largest brewer of beer sold in the United States, with a 7% market share nationally. Modelo owns the top-selling beer imported into the United States, Corona Extra. Its other popular brands sold in the United States include Corona Light, Modelo Especial, Negra Modelo, Victoria, and Pacifico. Crown, the joint venture established by Modelo and Constellation, imports, markets, and sells certain Modelo’s brands into the United States. Constellation, headquartered in Victor, New York, is a beer, wine, and spirits company with a portfolio of more than 100 products, including Robert Mondavi, Clos du Bois, Ruffino, and SVEDKA Vodka. It produces wine and distilled spirits, with more than forty facilities worldwide. Constellation is not currently a beer brewer; Constellation’s only involvement in the beer market in the United States is through its interest in Crown, although it actively participates in the management of that joint venture. Constellation is a Defendant to this action for the purpose of assuring the satisfaction of the objectives of the proposed Final Judgment, including the expansion of the Piedras Negras Brewery. ABI currently holds a 35.3% direct interest in Modelo, and a 23.3% direct interest in Modelo’s operating subsidiary Diblo S.A. de C.V (‘‘Diblo’’). ABI’s current stake in Modelo gives ABI certain minority voting rights and the right to appoint nine members of Modelo’s 19-member Board of Directors.7 7 The sale of the Divestiture Assets to Constellation (or another acquirer) will eliminate E:\FR\FM\22MYN2.SGM Continued 22MYN2 30410 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices On June 28, 2012, ABI agreed to purchase, through an Agreement and Plan of Merger, along with a Transaction Agreement between ABI, Modelo and Diblo, the remaining equity interest from Modelo’s owners, thereby obtaining full ownership and control of Modelo, for approximately $20.1 billion. At the time, Defendants also proposed to sell Modelo’s stake in Crown to Constellation and enter into a ten-year supply agreement to provide Modelo beer to Constellation to import into the United States. The United States rejected this proposed vertical ‘‘fix’’ to a horizontal merger as inadequate to address the likely harm to competition that would result from the proposed transaction. Most importantly, the proposed supply agreement would not have alleviated the potential harm to competition that the proposed transaction created: It did not create an independent, fully-integrated brewer with permanent control of Modelo Brand Beer in the United States. The United States therefore filed a Complaint to enjoin this proposed acquisition on January 31, 2013. TKELLEY on DSK3SPTVN1PROD with NOTICES2 B. The Competitive Effects of the Transaction on the Market for Beer in the United States 1. Relevant Markets Beer is a relevant product market under Section 7. Wine, distilled liquor, and other alcoholic or non-alcoholic beverages do not substantially constrain the prices of beer, and a hypothetical monopolist in the beer market could profitably raise prices. ABI and other brewers generally categorize beers internally into different tiers based primarily on price, including subpremium, premium, premium plus, and high-end. However, beers in different categories compete with each other, particularly when in adjacent tiers. For example, Modelo’s Corona Extra— usually considered a high-end beer— regularly targets ABI’s Bud Light, a premium light beer, as its primary competitor. Both national and local geographic markets exist in this industry. The proposed merger would likely result in increased prices for beer in the United States market as a whole and in at least 26 Metropolitan Statistical Areas (‘‘MSAs’’). Large beer companies make competitive decisions and develop strategies regarding product development, marketing, and brandbuilding on a national level. Further, large beer brewers typically create and implement national pricing strategies. ABI’s minority right and sharing of profits in Modelo’s U.S. business. VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 However, beer brewers make many pricing and promotional decisions at the local level, reflecting local brand preferences, demographics, and other factors, which can vary significantly from one local market to another. The 26 MSAs alleged in the Complaint are areas in which beer purchasers are particularly vulnerable to targeted price increases. 2. Competitive Effects The beer industry in the United States is highly concentrated and would become more so if ABI were allowed to acquire all of the remaining Modelo assets required to compete in the United States, as the transaction was originally proposed. ABI and MillerCoors, the two largest beer brewers in the United States, account for more than 65% of beer sold in the United States. Modelo is the third largest beer brewer, constituting approximately 7% of national sales, and in certain MSAs its market share approaches 20%. Heineken and hundreds of smaller fringe competitors comprise the remainder of the beer market. In the 26 MSAs alleged in the Complaint, ABI and Modelo control an even larger share of the market, creating a presumption under the Clayton Act that the merger of the two firms would result in harm to competition in those markets. Even so, the market shares of ABI and Modelo understate the potential anticompetitive effect of the proposed merger. The United States determined through its investigation that large brewers engage in significant levels of tacit coordination and that coordination has reduced competition and increased prices. In most regions of the United States, major brewers implement price increases on an annual basis in the fall. ABI is usually first to announce its annual price increases, setting forth recommended wholesale price increases designed to be transparent and to encourage others to follow. MillerCoors typically announces its price increases after ABI has publicized its price increases, and largely matches ABI’s price increases. As a result, although ABI and MillerCoors have highly visible competing advertising and product innovation programs, they do not substantially constrain each other’s annual price increases. The third largest brewer, Modelo, has increasingly constrained ABI’s and MillerCoors’s ability to raise prices. To build its market share, Modelo (through its importer Crown) has tended not to follow the announced price increases of ABI and MillerCoors. This competitive strategy narrowed the price gap between Modelo’s high-end brands and ABI’s PO 00000 Frm 00012 Fmt 4701 Sfmt 4703 and MillerCoors’s premium and premium plus brands, allowing Modelo to build market share at the expense of ABI and MillerCoors. By compressing the price gap between high-end and premium brands, Modelo’s actions have increasingly limited ABI’s ability to lead beer prices higher. Therefore, ABI’s acquisition of Modelo, as originally proposed, would have been likely to lead to higher beer prices in the United States by eliminating a competitor that resisted coordinated price increases initiated by the market share leader, ABI. ABI and Modelo compete aggressively. Modelo brands compete with ABI brands in numerous venues and occasions, appealing to similar sets of consumers in terms of taste, quality, consumer perception, and value. As a result, Modelo (through its importer Crown) often sets its prices in particular markets with reference to the price of the leading ABI products, and engages in price competition through promotional activity designed to take share from the market leaders. Because a significant number of consumers regard the ABI brands and Modelo brands as substitutes, the merger, absent the divestiture, would create an incentive for ABI to raise the prices of some or all of the merged firm’s brands and profitably recapture sales that result from consumers switching between the ABI brands and Modelo brands. Further, competition from Modelo has spurred additional significant product innovation from ABI, including the introduction of Bud Light Lime, the introduction of new packages such as ‘‘Azulitas,’’ 8 and the expansion of Landshark Lager. The merger of the two firms, as originally proposed, would have been likely to negatively affect ABI’s incentive to innovate, bring new products to market, and otherwise invest in attracting consumers away from the unique Modelo brands. 3. Entry and Expansion Neither entry into the beer market, nor any repositioning of existing brewers, would undo the anticompetitive harm from ABI’s acquisition of Modelo, as originally proposed. Modelo’s brands compete well against ABI due to their brand positioning and reputation, their wellestablished marketing and broad acceptance by a wide range of consumers, and their robust distribution network resulting in the near-ubiquity of Corona Extra in the establishments where consumers purchase and 8 Azulitas are 8 ounce cans of Bud Light that compete directly with Modelo’s ‘‘Coronitas.’’ E:\FR\FM\22MYN2.SGM 22MYN2 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices The proposed Final Judgment requires ABI to license rather than divest the brands because ABI retains the right to brew and market Modelo’s brands throughout the rest of the world. The structure of the licenses provides Constellation all the rights and abilities it needs to compete in the United States as Modelo did before the merger, including the opportunity to introduce new brands in the United States that Modelo already markets in Mexico, such ´ as Leon. The licenses are perpetual and assignable and cannot be terminated by ABI for any reason. They include the right to develop and launch new brand extensions and packages, to update brand recipes in response to consumer demand, and to adopt, or decline to adopt, any updated recipes for any of the licensed brands that ABI may choose to use outside the United States. This flexibility allows Constellation to adapt to changing market conditions in the United States to compete effectively in the future, and reduces ABI’s ability to interfere with those adaptations. The assets must be divested and/or licensed in such a way as to satisfy the United States, in its sole discretion, that the operations can and will be operated by the purchaser as a viable, ongoing business that can compete effectively in the relevant market. Defendants ABI and Modelo must take all reasonable steps necessary to accomplish the divestiture 9 The licensed brands include all the brands that Modelo currently offers (through its distributor Crown) in the United States: Corona, Corona Light, Modelo Especial, Negra Modelo, Modelo Light, Pacifico, and Victoria. The license also includes certain brands not yet offered in the United States, but that Constellation would be free to launch here: ´ Pacifico Light, Barrilito, and Leon. III. Explanation of the Proposed Final Judgment The proposed Final Judgment contains a clean, structural remedy that eliminates the likely anticompetitive effects of the acquisition in the market for beer in the United States and the 26 local markets identified in the Complaint. The divestitures required by the proposed Final Judgment will create an independent and economically viable competitor that will stand in the shoes of Modelo in the United States. Specifically, the divestiture of the Piedras Negras Brewery and Modelo’s VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 interest in Crown, and the perpetual brand licenses required by the proposed Final Judgment, will vest in Constellation (or an alternative purchaser, should ABI’s divestiture to Constellation not be completed) the brewing capacity, the assets, and the other rights needed to produce, market, and sell Modelo Brand Beer in a manner similar to that which we see today. In short, the divestiture preserves the current structure of the beer market in the United States by maintaining an independent brewer with an incentive to resist following ABI’s price leadership in order to expand share. Furthermore, the proposed Final Judgment puts an end to the existing entanglements between ABI and Modelo with respect to the United States beer market. Finally, the proposed Final Judgment also provides for supervision by this Court and the United States of the transition services necessary to allow Constellation or another acquirer to compete effectively while the divestiture and expansion of the Piedras Negras Brewery are completed. PO 00000 Frm 00013 Fmt 4701 Sfmt 4703 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.003</GPH> A. The Divestiture The proposed Final Judgment requires ABI, within 90 days after entry of the Stipulation and Order by the Court, to (1) divest to Constellation Modelo’s current interest in Crown, along with the Piedras Negras Brewery and associated assets, and (2) grant to Constellation a perpetual, assignable license to ten of the most popular Modelo Brand Beers, including Corona and Modelo Especial, for sale in the United States.9 The rights, assets, and interests to be divested to Constellation are set forth in the transaction agreements that are attached as exhibits to the proposed Final Judgment. If the divestiture to Constellation should fail to close, ABI would be required to make those same divestitures, and grant the same licenses, to another acquirer acceptable to the United States for the purpose of enabling that alternative acquirer to brew Modelo Brand Beer, and to market and distribute them in the United States market. The proposed Final Judgment differs significantly from the deal that ABI sought unilaterally to impose and that is described in the Complaint. It vertically integrates the production and sale of Modelo Brand Beer in the United States and eliminates ABI’s control of Modelo Brand Beer in the United States, as illustrated below: consume beer. Any entrant would face enormous costs in attempting to replicate these assets, and would take many years to succeed. Building nationally recognized and accepted brands, which retailers will support with feature and display activity, is difficult, expensive, and time consuming. While consumers have undoubtedly benefited from the launch of many individual craft and specialty beers in the United States, the multiplicity of such brands does not replace the nature, scale, and scope of competition that Modelo provides today, and that would otherwise be eliminated by the proposed transaction. TKELLEY on DSK3SPTVN1PROD with NOTICES2 30411 30412 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices quickly. In the event that ABI does not accomplish the divestiture within 90 days as prescribed in the proposed Final Judgment, the Final Judgment provides that the Court will appoint a trustee selected by the United States to complete the divestiture.10 TKELLEY on DSK3SPTVN1PROD with NOTICES2 B. Mandatory Expansion of the Piedras Negras Brewery For the divestiture to be successful in replacing Modelo as a competitor, Constellation must expand the Piedras Negras Brewery’s production capabilities. Section V.A of the proposed Final Judgment requires Constellation (or an alternative purchaser) to expand the Piedras Negras Brewery to be able to produce 20 million hectoliters of packaged beer annually by December 31, 2016. Such expansion will allow Constellation to produce, independently from ABI, enough Modelo Brand Beer to replicate Modelo’s current competitive role in the United States. The required expansion also allows for expected future growth in sales of the licensed brands. In carrying out the expansion, Constellation is required to use its best efforts to adhere to specific construction milestones delineated in Sections V.A.1–8 of the proposed Final Judgment. A Monitoring Trustee will be appointed who will have the responsibility to observe the expansion and to report to the United States and the Court on whether the expansion is on track to be completed in the required timeframe. Requiring the buyer of divested assets to improve those assets for the purposes of competing against the seller is an exceptional remedy that the United States found appropriate under the specific set of facts presented here. The recently constructed Piedras Negras Brewery is an ideal brewery for divestiture because it is near the United States border, is highly efficient, and features modular construction that was designed and equipped specifically to allow for economical expansion. No other combination of Modelo’s brewing assets would have properly addressed the competitive harm caused by the proposed merger and allowed the acquirer of the Divestiture Assets to compete as effectively and economically with ABI as Modelo does today. 10 The proposed Final Judgment also provides that the United States may extend the time for ABI to accomplish the divestiture by up to 60 days, in its sole discretion. VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 C. Employee Retention Provisions; Transitional Support and Supply Agreements The proposed Final Judgment provides for or incorporates agreements protecting Constellation’s ability to operate and expand the Piedras Negras Brewery while actively competing in the United States. As part of the asset purchase, Constellation (or an alternative purchaser) will become the owner of the company that employs personnel who currently operate the Piedras Negras Brewery.11 Section IV.D of the proposed Final Judgment prevents ABI or Modelo from interfering with Constellation’s retention of those employees as part of the asset transfer. Together with the transition services, this provides Constellation with the specific knowledge necessary to operate the Piedras Negras Brewery. Sections IV.G–I of the proposed Final Judgment require the parties to enter into transition services and interim supply agreements. The transition services agreement (Section IV.G) requires ABI to provide consulting services with respect to topics such as the management of the Piedras Negras Brewery, logistics, material resource planning, and other general administrative services that Modelo currently provides to the Piedras Negras Brewery. The transition services agreement also requires ABI to supply certain key inputs (such as aluminum cans, glass, malt, yeast, and corn starch) for a limited time. The interim supply agreement (Section IV.H–I) requires ABI to supply Constellation with sufficient Modelo Brand Beer each year to make up for any difference between the demand for such beers in the United States and the Piedras Negras Brewery’s capacity to fulfill that demand. The transition services and interim supply agreements are necessary to allow Constellation (or an alternative purchaser) to continue to compete in the United States during the time it takes to expand the Piedras Negras Brewery’s capacity to brew and bottle beer, but are time-limited to assure that Constellation will become a fully independent competitor to ABI as soon as practicable. As such, in conjunction with the firewall provisions described below, they prevent the vertical supply arrangement from causing competitive harm in the near term. The proposed Final Judgment subjects these agreements, including any extensions, to monitoring by a court-appointed 11 The company is Servicios Modelo de Coahuila, S.A. de C.V., a subsidiary of Grupo Modelo with its headquarters in Coahuila, Mexico. PO 00000 Frm 00014 Fmt 4701 Sfmt 4703 trustee and, in the event that a firm other than Constellation acquires the assets, the acquisition requires approval by the United States. D. Distribution of Modelo Brand Beer Effective distribution is important for a brewer to be competitive in the beer industry. The proposed Final Judgment imposes two requirements on ABI regarding its distribution network that are designed to limit ABI’s ability to interfere with Constellation’s effective distribution of Modelo Brand Beer. These requirements ensure that Constellation can reduce the threat of discrimination in distribution at the hands of ABI-owned distributors or ABIsponsored distributor incentive programs, in recognition of the influence ABI already exercises in the concentrated beer distribution markets. First, Section V.C of the proposed Final Judgment provides that, for ABI’s majority-owned distributors (‘‘ABIOwned Distributors’’) that distribute Modelo Brand Beer, Constellation will have a window of opportunity to terminate that distribution relationship and direct the ABI-owned distributor to sell the distribution rights to another distributor. Similarly, should ABI subsequently acquire any distributors that have contractual rights to distribute Modelo Brand Beer, Constellation may require ABI to sell those rights. Second, the proposed Final Judgment prevents ABI for 36 months from downgrading a distributor’s ranking in ABI’s distributor incentive programs by virtue of the distributor’s decision to carry Modelo Brand Beer. The 36-month time period tracks the initial term of the transition service and interim supply agreements, and thus allows Constellation to maintain a status quo position for the Modelo Brand Beer in ABI’s distribution incentive programs until Constellation can operate independently of ABI. E. Divestiture Trustee In the event that Defendants do not accomplish the divestiture as prescribed in the proposed Final Judgment, either to Constellation or to an alternative buyer, Section VI of the proposed Final Judgment provides that the Court will appoint a Divestiture Trustee selected by the United States to complete the divestiture. If a Divestiture Trustee is appointed, the proposed Final Judgment provides that ABI will pay all costs and expenses of the Divestiture Trustee. Under the proposed Final Judgment, the Divestiture Trustee shall have the ability to modify the package of assets to be divested, should such modification become necessary to enable an acquirer E:\FR\FM\22MYN2.SGM 22MYN2 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices to expand and operate the Piedras Negras Brewery or if there has been a breach in the representations made by ABI and Modelo regarding the completeness of the assets. After his or her appointment becomes effective, the Divestiture Trustee will file monthly reports with the Court and the United States setting forth his or her efforts to accomplish the divestiture. TKELLEY on DSK3SPTVN1PROD with NOTICES2 F. Monitoring Trustee Section VIII of the proposed Final Judgment permits the appointment of a Monitoring Trustee by the United States in its sole discretion and the United States intends to appoint one and seek the Court’s approval. The Monitoring Trustee will ensure that Defendants expeditiously comply with all of their obligations and perform all of their responsibilities under the proposed Final Judgment and the Stipulation and Order; that the Divestiture Assets remain economically viable, competitive, and ongoing assets; and that competition in the sale of beer in the United States in the relevant markets is maintained until the required divestitures and other requirements of the proposed Final Judgment have been accomplished. The Monitoring Trustee will have the power and authority to monitor Defendants’ compliance with the terms of the Final Judgment and attendant interim supply and services contracts. The Monitoring Trustee will have access to all personnel, books, records, and information necessary to monitor such compliance, and will serve at the cost and expense of ABI. The Monitoring Trustee will file reports every 90 days with the United States and the Court setting forth Defendants’ efforts to comply with their obligations under the proposed Final Judgment and the Stipulation and Order. G. Stipulation and Order Provisions Defendants have entered into the Stipulation and Order attached as an exhibit to the Explanation of Consent Decree Procedures, which was filed simultaneously with the Court, to ensure that, pending the divestitures, the Divestiture Assets are maintained as an ongoing, economically viable, and active business. The Stipulation and Order ensures that the Divestiture Assets are preserved and maintained in a condition that allows the divestitures to be effective. The Stipulation and Order also adds Constellation as a Defendant for purposes of entering the Final Judgment. H. Notification Provisions Section XII of the proposed Final Judgment requires ABI to notify the VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 United States in advance of executing certain transactions that would not otherwise be reportable under the HartScott-Rodino Antitrust Improvements Act of 1976. The transactions covered by these provisions include the acquisition or license of any interest in non-ABI brewing assets or brands, excluding acquisitions of: (1) Foreignlocated assets that do not generate at least $7.5 million in annual gross revenue from beer sold for resale in the United States; (2) certain ordinarycourse asset purchases and passive investments; and (3) distribution licenses that do not generate at least $3 million in annual gross revenue in the United States. This provision ensures that the United States will have the ability to take action in advance of any transactions that could potentially impact competition in the United States beer market. I. Firewall Section XIII of the proposed Final Judgment requires ABI and Modelo to implement firewall procedures to prevent Constellation’s (or an alternative acquirer’s) confidential business information from being used within ABI or Modelo for any purpose that could harm competition or provide an unfair competitive advantage to ABI based on its role as a temporary supplier to Constellation under either the transition services or interim supply agreements. Within ten days of the Court approving the Stipulation and Order described above, ABI and Modelo must submit their planned procedures for maintaining a firewall. Additionally, ABI and Modelo must brief certain officers of the company and business personnel who have responsibility for commercial interactions with Constellation as to their required treatment of Constellation’s confidential business information. This provision ensures that ABI and Modelo cannot improperly use any confidential information they receive from Constellation in ways that would harm competition in the beer industry or impair Constellation’s competitive prospects. IV. Remedies Available to Potential Private Litigants Section 4 of the Clayton Act, 15 U.S.C. 15, provides that any person who has been injured as a result of conduct prohibited by the antitrust laws may bring suit in federal court to recover three times the damages the person has suffered, as well as costs and reasonable attorneys’ fees. Entry of the proposed Final Judgment will neither impair nor assist the bringing of any private PO 00000 Frm 00015 Fmt 4701 Sfmt 4703 30413 antitrust damage action. Under the provisions of Section 5(a) of the Clayton Act, 15 U.S.C. 16(a), the proposed Final Judgment has no prima facie effect in any subsequent private lawsuit that may be brought against Defendants. V. Procedures Available for Modification of the Proposed Final Judgment The United States and Defendants have stipulated that the proposed Final Judgment may be entered by the Court after compliance with the provisions of the APPA, provided that the United States has not withdrawn its consent. The APPA conditions entry upon the Court’s determination that the proposed Final Judgment is in the public interest. The APPA provides a period of at least sixty (60) days preceding the effective date of the proposed Final Judgment within which any person may submit to the United States written comments regarding the proposed Final Judgment. Any person who wishes to comment should do so within sixty (60) days of the date of publication of this Competitive Impact Statement in the Federal Register, or the last date of publication in a newspaper of the summary of this Competitive Impact Statement, whichever is later. All comments received during this period will be considered by the United States Department of Justice, which remains free to withdraw its consent to the proposed Final Judgment at any time prior to the Court’s entry of judgment. The comments and the response of the United States will be filed with the Court. In addition, comments will be posted on the U.S. Department of Justice, Antitrust Division’s internet Web site and published in the Federal Register. Written comments should be submitted to: James Tierney, Chief, Networks and Technology Enforcement Section, Antitrust Division, United States Department of Justice, 450 5th Street NW., Suite 7100, Washington, DC 20530. The proposed Final Judgment provides that the Court retains jurisdiction over this action, and the parties may apply to the Court for any order necessary or appropriate for the modification, interpretation, or enforcement of the Final Judgment. VI. Alternatives to the Proposed Final Judgment The United States considered, before initiating this lawsuit to enjoin the proposed merger, the Defendants’ proposal of selling Modelo’s stake in Crown to Constellation and entering into a ten-year supply agreement. The E:\FR\FM\22MYN2.SGM 22MYN2 30414 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices United States ultimately rejected this proposal as inadequate to address the merger’s likely anticompetitive effects. The settlement embodied within the proposed Final Judgment differs significantly from the Defendants’ original solution. Most importantly, the proposed Final Judgment ensures that Modelo Brand Beer sold in the United States will be brewed, imported, and sold by a firm that is vertically integrated and completely independent from ABI. Unlike the Defendants’ original proposal, which left Constellation with no brewing assets, beholden to ABI for the supply of beer, and was terminable after ten years, the proposed Final Judgment ensures Constellation will have independent brewing assets and the ownership of the Modelo Brand Beer for sale in the United States in perpetuity. The United States also considered, as an alternative to the proposed Final Judgment, a full trial on the merits against Defendants ABI and Modelo. The United States could have continued the litigation and sought preliminary and permanent injunctions against ABI’s acquisition of Modelo. The United States is satisfied, however, that the divestiture of assets described in the proposed Final Judgment, and concomitant expansion of the brewery assets, will preserve competition for the provision of beer in the relevant market identified by the United States. Thus, the proposed Final Judgment would achieve all or substantially all of the relief the United States would have obtained through litigation, but avoids the time, expense, and uncertainty of a full trial on the merits of the Complaint. VII. Standard of Review Under the APPA for the Proposed Final Judgment TKELLEY on DSK3SPTVN1PROD with NOTICES2 The Clayton Act, as amended by the APPA, requires that proposed consent judgments in antitrust cases brought by the United States be subject to a sixtyday comment period, after which the court shall determine whether entry of the proposed Final Judgment ‘‘is in the public interest.’’ 15 U.S.C. 16(e)(1). In making that determination, the court, in accordance with the statute as amended in 2004, is required to consider: (A) The competitive impact of such judgment, including termination of alleged violations, provisions for enforcement and modification, duration of relief sought, anticipated effects of alternative remedies actually considered, whether its terms are ambiguous, and any other competitive considerations bearing upon the adequacy of such judgment that the court deems necessary to a determination of whether the consent judgment is in the public interest; and VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 (B) the impact of entry of such judgment upon competition in the relevant market or markets, upon the public generally and individuals alleging specific injury from the violations set forth in the complaint including consideration of the public benefit, if any, to be derived from a determination of the issues at trial. 15 U.S.C. 16(e)(1)(A) & (B). In considering these statutory factors, the court’s inquiry is necessarily a limited one as the government is entitled to ‘‘broad discretion to settle with the defendant within the reaches of the public interest.’’ United States v. Microsoft Corp., 56 F.3d 1448, 1461 (D.C. Cir. 1995); see generally United States v. SBC Commc’ns, Inc., 489 F. Supp. 2d 1 (D.D.C. 2007) (assessing public interest standard under the Tunney Act); United States v. InBev N.V./S.A., 2009–2 Trade Cas. (CCH) ¶ 76,736, 2009 U.S. Dist. LEXIS 84787, No. 08–1965 (JR), at *3, (D.D.C. Aug. 11, 2009) (noting that the court’s review of a consent judgment is limited and only inquires ‘‘into whether the government’s determination that the proposed remedies will cure the antitrust violations alleged in the complaint was reasonable, and whether the mechanism to enforce the final judgment are clear and manageable.’’).12 As the United States Court of Appeals for the District of Columbia Circuit has held, under the APPA a court considers, among other things, the relationship between the remedy secured and the specific allegations set forth in the government’s complaint, whether the decree is sufficiently clear, whether enforcement mechanisms are sufficient, and whether the decree may positively harm third parties. See Microsoft, 56 F.3d at 1458–62. With respect to the adequacy of the relief secured by the decree, a court may not ‘‘engage in an unrestricted evaluation of what relief would best serve the public.’’ United States v. BNS, Inc., 858 F.2d 456, 462 (9th Cir. 1988) (citing United States v. Bechtel Corp., 648 F.2d 660, 666 (9th Cir. 1981)); see also Microsoft, 56 F.3d at 1460–62; United States v. Alcoa, Inc., 152 F. Supp. 2d 37, 40 (D.D.C. 2001); InBev, 2009 U.S. Dist. LEXIS 84787, at *3. Courts have held that: [t]he balancing of competing social and political interests affected by a proposed antitrust consent decree must be left, in the first instance, to the discretion of the 12 The 2004 amendments substituted ‘‘shall’’ for ‘‘may’’ in directing relevant factors for court to consider and amended the list of factors to focus on competitive considerations and to address potentially ambiguous judgment terms. Compare 15 U.S.C. 16(e) (2004), with 15 U.S.C. § 16(e)(1) (2006); see also SBC Commc’ns, 489 F. Supp. 2d at 11 (concluding that the 2004 amendments ‘‘effected minimal changes’’ to Tunney Act review). PO 00000 Frm 00016 Fmt 4701 Sfmt 4703 Attorney General. The court’s role in protecting the public interest is one of insuring that the government has not breached its duty to the public in consenting to the decree. The court is required to determine not whether a particular decree is the one that will best serve society, but whether the settlement is ‘‘within the reaches of the public interest.’’ More elaborate requirements might undermine the effectiveness of antitrust enforcement by consent decree. Bechtel, 648 F.2d at 666 (emphasis added) (citations omitted).13 In determining whether a proposed settlement is in the public interest, a district court ‘‘must accord deference to the government’s predictions about the efficacy of its remedies, and may not require that the remedies perfectly match the alleged violations.’’ SBC Commc’ns, 489 F. Supp. 2d at 17; see also Microsoft, 56 F.3d at 1461 (noting the need for courts to be ‘‘deferential to the government’s predictions as to the effect of the proposed remedies’’); United States v. Archer-DanielsMidland Co., 272 F. Supp. 2d 1, 6 (D.D.C. 2003) (noting that the court should grant due respect to the United States’ prediction as to the effect of proposed remedies, its perception of the market structure, and its views of the nature of the case). Courts have greater flexibility in approving proposed consent decrees than in crafting their own decrees following a finding of liability in a litigated matter. ‘‘[A] proposed decree must be approved even if it falls short of the remedy the court would impose on its own, as long as it falls within the range of acceptability or is ‘within the reaches of public interest.’’’ United States v. Am. Tel. & Tel. Co., 552 F. Supp. 131, 151 (D.D.C. 1982) (citations omitted) (quoting United States v. Gillette Co., 406 F. Supp. 713, 716 (D. Mass. 1975)), aff’d sub nom. Maryland v. United States, 460 U.S. 1001 (1983); see also United States v. Alcan Aluminum Ltd., 605 F. Supp. 619, 622 (W.D. Ky. 1985) (approving the consent decree even though the court would have imposed a greater remedy). To meet this standard, the United States ‘‘need only provide a factual basis for concluding that the settlements are reasonably adequate remedies for the 13 Cf. BNS, 858 F.2d at 464 (holding that the court’s ‘‘ultimate authority under the [APPA] is limited to approving or disapproving the consent decree’’); United States v. Gillette Co., 406 F. Supp. 713, 716 (D. Mass. 1975) (noting that, in this way, the court is constrained to ‘‘look at the overall picture not hypercritically, nor with a microscope, but with an artist’s reducing glass’’). See generally Microsoft, 56 F.3d at 1461 (discussing whether ‘‘the remedies [obtained in the decree are] so inconsonant with the allegations charged as to fall outside of the ‘reaches of the public interest’’’). E:\FR\FM\22MYN2.SGM 22MYN2 TKELLEY on DSK3SPTVN1PROD with NOTICES2 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices alleged harms.’’ SBC Commc’ns, 489 F. Supp. 2d at 17. Moreover, the court’s role under the APPA is limited to reviewing the remedy in relationship to the violations that the United States has alleged in its Complaint, and does not authorize the court to ‘‘construct [its] own hypothetical case and then evaluate the decree against that case.’’ Microsoft, 56 F.3d at 1459; see also InBev, 2009 U.S. Dist. LEXIS 84787, at *20 (‘‘the ‘public interest’ is not to be measured by comparing the violations alleged in the complaint against those the court believes could have, or even should have, been alleged’’). Because the ‘‘court’s authority to review the decree depends entirely on the government’s exercising its prosecutorial discretion by bringing a case in the first place,’’ it follows that ‘‘the court is only authorized to review the decree itself,’’ and not to ‘‘effectively redraft the complaint’’ to inquire into other matters that the United States did not pursue. Microsoft, 56 F.3d at 1459–60. As this court confirmed in SBC Communications, courts ‘‘cannot look beyond the complaint in making the public interest determination unless the complaint is drafted so narrowly as to make a mockery of judicial power.’’ SBC Commc’ns, 489 F. Supp. 2d at 15. In its 2004 amendments, Congress made clear its intent to preserve the practical benefits of utilizing consent decrees in antitrust enforcement, adding the unambiguous instruction that ‘‘[n]othing in this section shall be construed to require the court to conduct an evidentiary hearing or to require the court to permit anyone to intervene.’’ 15 U.S.C. 16(e)(2). The language wrote into the statute what Congress intended when it enacted the Tunney Act in 1974, as Senator Tunney explained: ‘‘[t]he court is nowhere compelled to go to trial or to engage in extended proceedings which might have the effect of vitiating the benefits of prompt and less costly settlement through the consent decree process.’’ 119 Cong. Rec. 24,598 (1973) (statement of Senator Tunney). Rather, the procedure for the public interest determination is left to the discretion of the court, with the recognition that the court’s ‘‘scope of review remains sharply proscribed by precedent and the nature of Tunney Act proceedings.’’ SBC Commc’ns, 489 F. Supp. 2d at 11.14 14 See United States v. Enova Corp., 107 F. Supp. 2d 10, 17 (D.D.C. 2000) (noting that the ‘‘Tunney Act expressly allows the court to make its public interest determination on the basis of the competitive impact statement and response to comments alone’’); United States v. Mid-Am. Dairymen, Inc., 1977–1 Trade Cas. (CCH) ¶ 61,508, VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 VIII. Determinative Documents The following determinative materials or documents within the meaning of the APPA were considered by the United States in formulating the proposed Final Judgment: • The Stock Purchase Agreement attached and labeled as Exhibit A to the proposed Final Judgment; • The Amended and Restated Membership Interest Purchase Agreement attached and labeled as Exhibit A to the proposed Final Judgment; • The Amended and Restated SubLicense Agreement attached and labeled as Exhibit A to the Stock Purchase Agreement; • The Transition Services Agreement attached and labeled as Exhibit B to the Stock Purchase Agreement; and • The Interim Supply Agreement attached and labeled as Exhibit A to the Amended and Restated Membership Interest Purchase Agreement. Dated: April 19, 2013. Respectfully submitted, s/Mary N. Strimel Mary N. Strimel (D.C. Bar No. 455303), Trial Attorney, United States Department of Justice, Antitrust Division, 450 5th Street NW., Suite 7100, Washington, DC 20530, Tel: (202) 616–5949, mary.strimel@usdoj.gov. United States District Court For the District of Columbia UNITED STATES OF AMERICA, Plaintiff, v. ANHEUSER-BUSCH InBEV SA/NV, et al., Defendants. Civil Action No. 13–127 (RWR) Judge Richard W. Roberts Certificate of Service I hereby certify that on the 19th day of April, 2013, I electronically filed the below-listed documents with the Clerk of the Court using the CM/ECF system: 1. United States’ Explanation of Consent Decree Procedures Attachment A: Stipulation and Order Attachment B: Final Judgment [proposed] 2. Competitive Impact Statement 3. Motion for Leave to File Exhibits Under Seal 4. Notice of Filing Under Seal; and 5. Certificate of Service at 71,980 (W.D. Mo. 1977) (‘‘Absent a showing of corrupt failure of the government to discharge its duty, the Court, in making its public interest finding, should . . . carefully consider the explanations of the government in the competitive impact statement and its responses to comments in order to determine whether those explanations are reasonable under the circumstances.’’); S. Rep. No. 93–298, 93d Cong., 1st Sess., at 6 (1973) (‘‘Where the public interest can be meaningfully evaluated simply on the basis of briefs and oral arguments, that is the approach that should be utilized.’’). PO 00000 Frm 00017 Fmt 4701 Sfmt 4703 30415 The CM/ECF system will send a notice of electronic filing (NEF) to counsel for the Defendants: For Defendant Anheuser Busch InBev SA/NV: Steven C. Sunshine Gregory Bestor Craig SKADDEN, ARPS, SLATE, MEAGHER & FLOM LLP, 1440 New York Avenue NW., Washington, DC 20005–2111, Tel: (202) 371–7000, Steven.Sunshine@skadden.com, Gregory.Craig@skadden.com Ian G. John Karen Hoffman Lent SKADDEN, ARPS, SLATE, MEAGHER & FLOM LLP, Four Times Square, New York, NY 10024, Tel: (212) 735–3495, Ian.John@skadden.com, Karen.Lent@skadden.com Thomas J. Nolan SKADDEN, ARPS, SLATE, MEAGHER & FLOM LLP, 300 South Grand Avenue, Suite 3400, Los Angeles, California 90071, Tel. (213) 687–5250, Thomas.Nolan@skadden.com For Defendant Grupo Modelo S.A. de C.V.: Richard J. Stark Yonatan Even CRAVATH, SWAINE & MOORE LLP, 825 Eighth Avenue, New York, NY 10019–7475, Tel: (212) 474–1000, rstark@cravath.com, yeven@cravath.com The CM/ECF system will send a notice of electronic filing (NEF) to the counsel below, whom I also served with the above-listed documents via email after obtaining written consent pursuant to Fed. R. Civ. P. 5(b)(2)(E): For Proposed Settlement Defendant Constellation Brands, Inc., Margaret H. Warner Raymond A. Jacobsen, Jr. Jon B. Dubrow MCDERMOTT WILL & EMERY LLP, 500 North Capitol Street NW., Washington, DC 20001, Tel: (202) 756–8000, mwarner@mwe.com, rayjacobsen@mwe.com, jdubrow@mwe.com Respectfully submitted, FOR PLAINTIFF UNITED STATES OF AMERICA /s/Mary N. Strimel Mary N. Strimel (D.C. Bar No. 455303), Trial Attorney, Antitrust Division, U.S. Department of Justice, 450 Fifth Street NW., Suite 7100, Washington, DC 20530, Telephone: (202) 616–5949, Email: mary.strimel@usdoj.gov E:\FR\FM\22MYN2.SGM 22MYN2 30416 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices United States District Court For the District of Columbia UNITED STATES OF AMERICA, Plaintiff, v. ANHEUSER-BUSCH InBEV SA/NV, et al., Defendants. Civil Action No. 13–127 (RWR) Judge Richard W. Roberts TKELLEY on DSK3SPTVN1PROD with NOTICES2 Proposed Final Judgment Whereas, Plaintiff United States of America (‘‘United States’’) filed its Complaint against Defendants Anheuser-Busch InBev SA/NV (‘‘ABI’’) and Grupo Modelo, S.A.B. de C.V. (‘‘Modelo’’) on January 31, 2013; And whereas, pursuant to a Stipulation among Plaintiff and the Defendants including Defendant Constellation Brands, Inc., (‘‘Constellation’’), the Court has joined Constellation as a Defendant to this action for the purposes of settlement and for the entry of this Final Judgment; And whereas, the United States and Defendants ABI, Modelo, and Constellation, by their respective attorneys, have consented to entry of this Final Judgment without trial or adjudication of any issue of fact or law, and without this Final Judgment constituting any evidence against or admission by any party regarding any issue of fact or law; And whereas, Defendants agree to be bound by the provisions of the Final Judgment pending its approval by the Court; And whereas, the essence of this Final Judgment is (a) the prompt and certain divestiture of certain rights and assets held by Defendants ABI and Modelo to Defendant Constellation (or other firm) as an Acquirer, to assure that competition is not substantially lessened; and (b) the necessary and appropriate build-out and capacity expansion of the Piedras Negras Brewery by the Acquirer over time to ensure that the Acquirer is able to compete in the United States independent of a relationship to the Sellers; And whereas, this Final Judgment requires Defendants ABI and Modelo to make certain divestitures to Defendant Constellation (or other Acquirer) for the purpose of remedying the loss of competition alleged in the Complaint; And whereas, Defendants ABI and Modelo intend for the divestiture of certain rights and assets to Constellation (or other Acquirer) to be permanent; And whereas, this Final Judgment requires Defendant Constellation (or other Acquirer) to make certain investments for the purpose of VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 expanding the capacity of the Piedras Negras Brewery; And whereas, Defendants have represented to the United States that the divestitures required below can and will be made, and Defendant Constellation has represented that the Piedras Negras Brewery investments and expansion can and will be accomplished, and that Defendants will later raise no claim of hardship or difficulty as grounds for asking the Court to modify any of the provisions contained below; Now therefore, before any testimony is taken, without trial or adjudication of any issue of fact or law, and upon consent of the parties, it is ordered, adjudged, and decreed: I. Jurisdiction This Court has jurisdiction over the subject matter of and each of the parties to this action. The Complaint states a claim upon which relief may be granted against Defendants ABI and Modelo under Section 7 of the Clayton Act, as amended (15 U.S.C. 18). Pursuant to the Stipulation filed simultaneously with this Final Judgment joining Constellation as a Defendant to this action for the purpose of this Final Judgment, Constellation has consented to this Court’s exercise of personal jurisdiction over it. II. Definitions As used in the Final Judgment: A. ‘‘ABI’’ means Anheuser-Busch InBev SA/NV, its domestic and foreign parents, predecessors, divisions, subsidiaries, affiliates, partnerships and joint ventures (excluding Crown, and, prior to the completion of the Transaction, Modelo); and all directors, officers, employees, agents, and representatives of the foregoing. The terms ‘‘parent,’’ ‘‘subsidiary,’’ ‘‘affiliate,’’ and ‘‘joint venture’’ refer to any person in which there is majority (greater than 50 percent) or total ownership or control between the company and any other person. B. ‘‘ABI-Owned Distributor’’ means any Distributor in which ABI owns more than 50 percent of the outstanding equity interests as of the date of the divestiture of the Divestiture Assets. C. ‘‘Acquirer’’ means: 1. Constellation; or 2. an alternative purchaser of the Divestiture Assets selected pursuant to the procedures set forth in this Final Judgment. D. ‘‘Acquirer Confidential Information’’ means: 1. Confidential commercial information of Constellation (or other Acquirer) that has been obtained from such entity, including quantities, units, PO 00000 Frm 00018 Fmt 4701 Sfmt 4703 and prices of items ordered or purchased from the Sellers by the Acquirer, and any other competitively sensitive information regarding the Sellers’ or the Acquirer’s performance under the Interim Supply Agreement or the Transition Services Agreement; and 2. confidential unit sales data, nonpublic pricing strategies and plans, or any other confidential commercial information of the Acquirer that either an ABI-Owned Distributor, or any other Distributor in which ABI acquires a majority interest after the date of the divestiture contemplated herein, obtains from the Acquirer by virtue of its relationship with the Acquirer. E. ‘‘Beer’’ means any fermented alcoholic beverage that (1) is composed in part of water, a type of starch, yeast, and a flavoring and (2) has undergone the process of brewing. F. ‘‘Brewery Companies’’ means (1) ˜ Compania Cervecera de Coahuila S.A. de C.V., a subsidiary of Grupo Modelo with its headquarters in Coahuila, Mexico, and (2) Servicios Modelo de Coahuila, S.A. de C.V., a subsidiary of Grupo Modelo with its headquarters in Coahuila, Mexico. G. ‘‘Constellation’’ means Constellation Brands, Inc., its domestic and foreign parents, predecessors, divisions, subsidiaries, affiliates, partnerships and joint ventures, including but not limited to, Crown, and all directors, officers, employees, agents, and representatives of the foregoing. The terms ‘‘parent,’’ ‘‘subsidiary,’’ ‘‘affiliate,’’ and ‘‘joint venture’’ refer to any person in which there is majority (greater than 50 percent) or total ownership or control between the company and any other person. H. ‘‘Covered Entity’’ means any Beer brewer, importer, or brand owner (other than ABI) that derives more than $7.5 million in annual gross revenue from Beer sold for further resale in the United States, or from license fees generated by such Beer sales. I. ‘‘Covered Interest’’ means any nonABI Beer brewing assets or any non-ABI Beer brand assets of, or any interest in (including any financial, security, loan, equity, intellectual property, or management interest), a Covered Entity; except that a Covered Interest shall not include (i) a Beer brewery or Beer brand located outside the United States that does not generate at least $7.5 million in annual gross revenue from Beer sold for resale in the United States; or (ii) a license to distribute a non-ABI Beer brand where said distribution license does not generate at least $3 million in annual gross revenue in the United States. E:\FR\FM\22MYN2.SGM 22MYN2 TKELLEY on DSK3SPTVN1PROD with NOTICES2 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices J. ‘‘Crown’’ means Crown Imports, LLC, the joint venture between Constellation and Modelo that is in the business of importing Modelo Brand Beer into the United States, or any successor thereto. K. ‘‘Defendants’’ means ABI, Modelo, and Constellation, and any successor or assignee to all or substantially all of the business or assets of ABI, Modelo, or Constellation involved in the brewing of Beer. L. ‘‘Distributor’’ means a wholesaler in the Territory who acts as an intermediary between a brewer or importer of Beer and a retailer of Beer. M. ‘‘Distributor Incentive Program’’ means the Anheuser-Busch Voluntary Alignment Incentive Program and any other policy or program, either currently in effect or implemented hereafter, that offers some type of benefit to a Distributor based on the Distributor’s sales performance, its loyalty in supporting any brand or brands of Beer, or its commercial support for any brand or brands of Beer, including decisions of which brands to carry or the sales volume of each. N. ‘‘Divestiture Assets’’ means all tangible and intangible assets, rights and interests necessary to effectuate the purposes of this Final Judgment, as specified by the following agreements attached hereto and labeled as Exhibit A to this Final Judgment: The Stock Purchase Agreement (including the exhibits thereto) and the MIPA (including the exhibits thereto). In addition: 1. In the event that the Acquirer is a buyer other than Constellation, the Divestiture Assets shall also include the Entire Importer Interest, pursuant to ABI’s Drag-Along Right to require Constellation to divest such interest, and subject to Constellation’s right to receive compensation in the event of such divestiture, as set forth in Section 12.5 of the MIPA, attached hereto in Exhibit A; and a. in the event that a Divestiture Trustee is appointed, the Divestiture Trustee may, with the consent of the United States pursuant to Section IV.J herein: Include in the Divestiture Assets any additional assets, including tangible assets as well as intellectual property interests and other intangible interests or assets that extend beyond the United States, if the Divestiture Trustee finds the inclusion of such assets necessary to enable the Acquirer to expand the Piedras Negras Brewery to a Nominal Capacity of at least twenty (20) million hectoliters of packaged Beer per year, or to remedy any breach that the Monitoring Trustee has identified pursuant to Section VIII.B.3 herein; or VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 b. remove from the divestiture package any assets that are not needed by the Acquirer to accomplish the purposes of this Final Judgment, if such removal will facilitate the divestiture of Modelo’s United States Beer business as contemplated by this Final Judgment. O. ‘‘Drag-Along Right’’ means ABI’s right, as defined in Section 12.5(b) of the MIPA, attached hereto in Exhibit A, to require Constellation to divest Constellation’s interest in Crown in the event Constellation is not the Acquirer. P. ‘‘Entire Importer Interest’’ means Constellation’s present interest in Crown, as defined in Section 12.5(b) of the MIPA, attached hereto in Exhibit A. Q. ‘‘Hold Separate Stipulation and Order’’ means the Stipulation and Order filed by the parties simultaneously herewith, which imposes certain duties on the Defendants with respect to the operation of the Divestiture Assets pending the proposed divestitures, and also adds Constellation as a Defendant in this action. R. ‘‘Interim Supply Agreement’’ means: 1. The form of agreement between Modelo and Crown, attached as Exhibit A to the MIPA, attached hereto, and incorporated herein, or 2. in the event the Divestiture Assets are sold to an Acquirer other than Constellation, an agreement between Sellers and the Acquirer to provide the same types of services under substantially similar terms as provided in Exhibit A to the MIPA incorporated hereto, subject to approval by the United States in its sole discretion. S. ‘‘MIPA’’ means the Amended and Restated Membership Interest Purchase Agreement among Constellation Beers Ltd., Constellation Brands Beach Holdings, Inc., Constellation Brands, Inc., and Anheuser-Busch InBev SA/NV dated February 13, 2013, as amended on April 19, 2013, and attached hereto in Exhibit A. T. ‘‘Modelo’’ means Grupo Modelo, S.A.B. de C.V., its domestic and foreign parents, predecessors, divisions, subsidiaries, affiliates, partnerships and joint ventures (excluding Crown and the entities listed on Exhibit B hereto); and all directors, officers, employees, agents, and representatives of the foregoing. The terms ‘‘parent,’’ ‘‘subsidiary,’’ ‘‘affiliate,’’ and ‘‘joint venture’’ refer to any person in which there is majority (greater than 50 percent) or total ownership or control between the company and any other person. U. ‘‘Modelo Brand Beer’’ means any Beer SKU that is part of the Divestiture Assets, and any Beer SKU that may become subject to the agreements giving PO 00000 Frm 00019 Fmt 4701 Sfmt 4703 30417 effect to the divestitures required by Sections IV or VI of this Final Judgment. V. ‘‘Nominal Capacity’’ means a brewery’s annual production capacity for packaged Beer, if the brewery were operated at 100% capacity. W. ‘‘Piedras Negras Brewery’’ means all the land and all existing structures, buildings, plants, infrastructure, equipment, fixed assets, inventory, tooling, personal property, titles, leases, office furniture, materials, supplies, and other tangible property located in Nava, Coahuila, Mexico and owned by the Brewery Companies. X. ‘‘Sellers’’ means ABI and Modelo. Y. ‘‘Stock Purchase Agreement’’ means the Stock Purchase Agreement between Anheuser-Busch InBev SA/NV and Constellation Brands, Inc. dated February 13, 2013, as amended on April 19, 2013, and attached hereto in Exhibit A. Z. ‘‘Sub-License Agreement’’ means the Amended and Restated Sub-License Agreement between Marcas Modelo, S.A. de C.V. and Constellation Beers Ltd., attached as Exhibit A to the Stock Purchase Agreement. AA. ‘‘Territory’’ means the fifty states of the United States of America, the District of Columbia, and Guam. BB. ‘‘Transaction’’ means ABI’s proposed acquisition of the remainder of Modelo. CC. ‘‘Transition Services Agreement’’ means: 1. The form of agreement between ABI and Constellation attached as Exhibit B to the Stock Purchase Agreement, and incorporated herein; or 2. in the event the Divestiture Assets are sold to an Acquirer other than Constellation, an agreement between Sellers and such Acquirer to provide the same types of services under substantially similar terms as provided in Exhibit B to the Stock Purchase Agreement incorporated hereto, subject to approval by the United States in its sole discretion. III. Applicability A. This Final Judgment applies to Defendants, as defined above, and all other persons in active concert or participation with any of them who receive actual notice of this Final Judgment by personal service or otherwise. B. If, prior to complying with Section IV and VI of this Final Judgment, Sellers sell or otherwise dispose of all or substantially all of their assets or of lesser business units that include the Divestiture Assets, they shall require the purchaser to be bound by the provisions of this Final Judgment. E:\FR\FM\22MYN2.SGM 22MYN2 30418 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices TKELLEY on DSK3SPTVN1PROD with NOTICES2 IV. Divestiture A. The Court orders the divestitures set forth in this Section IV, having accepted the following representations made by the parties as of the date of filing this Final Judgment: 1. By ABI, the certain representations contained in Section 3.25 of the Stock Purchase Agreement attached in Exhibit A hereto regarding the sufficiency of the assets to be divested; 2. by ABI, the certain representations contained in Section 3.26 of the Stock Purchase Agreement attached in Exhibit A hereto regarding the absence of present knowledge of impediments to the expansion of capacity of the Piedras Negras Brewery; 3. by Modelo, the representations set forth in the Letter of Grupo Modelo, S.A.B. de C.V., dated April 17, 2013, attached hereto as Exhibit C, regarding the issues described in subparagraphs A.1 and A.2 above; and 4. by Modelo, the representations set forth in the Letter of Grupo Modelo, S.A.B. de C.V., dated April 17, 2013, attached hereto as Exhibit C, regarding the sufficiency of the assets being divested for the importation, marketing, distribution and sale of Modelo Brand Beer in the United States. B. ABI is ordered and directed, upon the later of (1) the completion of the Transaction or (2) ninety (90) calendar days after the filing of this proposed Final Judgment, to divest the Divestiture Assets in a manner consistent with this Final Judgment to an Acquirer acceptable to the United States in its sole discretion. The United States, in its sole discretion, may agree to one or more extensions of this time period not to exceed sixty (60) calendar days in total, and shall notify the Court in such circumstances. ABI agrees to use its best efforts to divest the Divestiture Assets as expeditiously as possible. C. In the event Sellers are attempting to divest the Divestiture Assets to an Acquirer other than Constellation, in accomplishing the divestiture ordered by this Final Judgment, Sellers promptly shall make known, by usual and customary means, the availability of the Divestiture Assets. Sellers shall inform any person making inquiry regarding a possible purchase of the Divestiture Assets that they are being divested pursuant to this Final Judgment and provide that person with a copy of this Final Judgment. Sellers shall offer to furnish to all prospective Acquirers, subject to customary confidentiality assurances, all information and documents relating to the Divestiture Assets customarily provided in a due diligence process except such VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 information or documents subject to the attorney-client privileges or workproduct doctrine. Sellers shall make available such information to the United States at the same time that such information is made available to any other person. D. Sellers shall provide the Acquirer and the United States information relating to the personnel involved in the operation of the Divestiture Assets to enable the Acquirer to make offers of employment. Sellers will not interfere with any negotiations by the Acquirer to retain, employ or contract with any employee of the Brewery Companies. Interference with respect to this paragraph includes, but is not limited to, enforcement of non-compete clauses, solicitation of employment with ABI or Modelo, offers to transfer to another facility of ABI or Modelo, and offers to increase salary or other benefits apart from those offered company-wide. E. In the event the Sellers are attempting to divest the Divestiture Assets to an Acquirer other than Constellation, Sellers shall permit prospective Acquirers of the Divestiture Assets to have reasonable access to personnel and to make inspections of the physical facilities of the Piedras Negras Brewery; access to any and all environmental, zoning, and other permit documents and information; and access to any and all financial, operational, or other documents and information customarily provided as part of a due diligence process. F. Defendants shall, as soon as possible, but within two (2) business days after completion of the relevant event, notify the United States of: (1) The effective date of the completion of the Transaction; and (2) the effective date of the sale of the Divestiture Assets to the Acquirer. G. Any amendment or modification of any of the agreements in Exhibit A, or any similar agreements entered with an Acquirer pursuant to Section IV.B, may only be entered into with the approval of the United States in its sole discretion. Sellers and the Acquirer shall enter into a Transition Services Agreement for a period up to three (3) years from the date of the divestiture to enable the Acquirer to compete effectively in providing Beer in the United States. Sellers shall perform all duties and provide any and all services required of Sellers under the Transition Services Agreement. Any amendments or modifications of the Transition Services Agreement may only be entered into with the approval of the United States in its sole discretion. H. Sellers and the Acquirer shall enter into an Interim Supply Agreement for a PO 00000 Frm 00020 Fmt 4701 Sfmt 4703 period up to three (3) years from the execution date of the divestiture to enable the Acquirer to compete effectively in providing Beer in the United States. Sellers shall perform all duties and provide any and all services required of Sellers under the Interim Supply Agreement. Any amendments, modifications, or extensions of the Interim Supply Agreement beyond three (3) years may only be entered into with the approval of the United States in its sole discretion. I. If the Acquirer seeks an extension of the Interim Supply Agreement, the Acquirer shall so notify the United States in writing at least four (4) months prior to the date the Interim Supply Agreement expires. If the United States approves such an extension, it shall so notify the Acquirer in writing at least three (3) months prior to the date the Interim Supply Agreement expires. The total term of the Interim Supply Agreement and any extension(s) so approved shall not exceed five (5) years. J. Unless the United States otherwise consents in writing, the divestiture pursuant to Section IV or VI shall include the entire Divestiture Assets, and shall be accomplished in such a way as to satisfy the United States, in its sole discretion, that the Divestiture Assets can and will be used by the Acquirer as part of a viable, ongoing business, engaged in providing Beer in the United States. The divestiture shall be: 1. made to an Acquirer that, in the United States’ sole judgment, has the intent and capability (including the necessary managerial, operational, technical and financial capability) to complete the expansion of the Piedras Negras Brewery as contemplated herein, and to compete in the business of providing Beer; and 2. accomplished so as to satisfy the United States, in its sole discretion, that none of the terms of the agreement between an Acquirer and Sellers gives Sellers the ability unreasonably to raise the Acquirer’s costs, to lower the Acquirer’s efficiency, or otherwise to interfere in the ability of the Acquirer to compete effectively. V. Required Expansion and Other Provisions Designed To Promote Competition A. Acquirer shall accomplish the expansion of the Piedras Negras Brewery to a Nominal Capacity of at least twenty (20) million hectoliters of packaged Beer annually, to include the ability to produce commercially reasonable quantities of each Modelo Brand Beer offered by Crown for sale in the United States as of the date of filing E:\FR\FM\22MYN2.SGM 22MYN2 TKELLEY on DSK3SPTVN1PROD with NOTICES2 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices this proposed Final Judgment. Acquirer shall complete the above expansion by December 31, 2016. As part of the expansion of the Piedras Negras Brewery, Defendant Constellation shall use its best efforts to complete the following construction milestones by the specified deadlines: 1. Within six (6) months from the date of divestiture, the appointment of, and contracts executed with, design and engineering firms; 2. Within twelve (12) months from the date of divestiture, the completion of the design and engineering (including specifications and rated capacities) of the brewhouse, packaging hall, and warehouse; 3. Within twelve (12) months from the date of divestiture, the obtainment of all necessary permits; 4. Within twelve (12) months from the date of divestiture, the commencement of construction of the brewhouse, packaging hall, and warehouse; 5. Within twenty-four (24) months from the date of divestiture, the completion of the construction of the warehouse and completion of the installation of equipment in the warehouse; 6. Within thirty (30) months from the date of divestiture, the completion of the construction of the brewhouse and completion of the installation of equipment in the brewhouse; 7. Within thirty-six (36) months from the date of divestiture, the completion of the construction of the packaging hall and the completion of the installation of equipment in the packaging hall; and 8. Within thirty-six (36) months from the date of divestiture, Constellation determines in its discretion that it is able to obtain its supply requirements from the Piedras Negras Brewery and is no longer dependent on supply under the Interim Supply Agreement. B. For a period of thirty-six (36) months after the date of the divestiture, (i) ABI shall not make any change to its Distributor Incentive Program that would cause any Modelo Brand Beer to count against a Distributor’s level of alignment, nor implement a new Distributor Incentive Program that would have a similar effect; and (ii) additionally, any Distributor’s carrying of Modelo Brand Beer shall not be considered by ABI to be an adverse factor or circumstance when determining whether or not to approve such Distributor’s purchase of any other Distributor. C. For a period of two (2) years beginning one (1) year after filing of this proposed Final Judgment, as to any ABIOwned Distributor that has rights to distribute Modelo Brand Beer in the VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 Territory, the Acquirer shall have the right, upon sixty (60) days notice to ABI, to direct the ABI-Owned Distributor to sell those rights to another Distributor identified by Acquirer, subject to the terms for such sales set forth in Exhibit D hereto, and incorporated herein. At least thirty (30) days before ABI acquires a majority of the equity interests in any additional Distributors after divestiture of the Divestiture Assets, and such Distributors have rights to distribute Modelo Brand Beer in the Territory, ABI shall notify the Acquirer of any such planned acquisition and the Acquirer shall have thirty (30) days from the date of such notice to provide notice to ABI that the Acquirer intends to exercise the rights outlined in Exhibit D hereto. D. If Sellers and the Acquirer enter into any new agreement(s) with each other with respect to the brewing, packaging, production, marketing, importing, distribution, or sale of Beer in the United States or elsewhere, Sellers and the Acquirer shall notify the United States of the new agreement(s) at least sixty (60) calendar days in advance of such agreement(s) becoming effective and such agreement(s) may only be entered into with the approval of the United States in its sole discretion. VI. Appointment of Trustee To Effect Divestiture A. If Sellers have not divested the Divestiture Assets within the time period specified in Section IV.B, Sellers shall notify the United States of that fact in writing. Upon application of the United States, the Court shall appoint a Divestiture Trustee selected by the United States and approved by the Court to divest the Divestiture Assets in a manner consistent with this Final Judgment. B. After the appointment of a Divestiture Trustee becomes effective, only the Divestiture Trustee shall have the right to sell the Divestiture Assets. The Divestiture Trustee shall have the power and authority to accomplish the divestiture to an Acquirer acceptable to the United States at such price and on such terms as are then obtainable upon reasonable effort by the Divestiture Trustee, subject to the provisions of Sections IV, V, VI, and VII of this Final Judgment, and shall have such other powers as this Court deems appropriate. C. Subject to Section VI.E of this Final Judgment, the Divestiture Trustee may hire at the cost and expense of Sellers any investment bankers, attorneys, or other agents, who shall be solely accountable to the Divestiture Trustee, reasonably necessary in the Divestiture Trustee’s judgment to assist in the divestiture. PO 00000 Frm 00021 Fmt 4701 Sfmt 4703 30419 D. Defendants shall not object to a sale by the Divestiture Trustee on any ground other than the Divestiture Trustee’s malfeasance. Any such objections by Defendants must be conveyed in writing to the United States and the Divestiture Trustee within ten (10) calendar days after the Divestiture Trustee has provided the notice required under Section VII.A. E. The Divestiture Trustee shall serve at the cost and expense of Sellers, pursuant to a written agreement with Sellers on such terms and conditions as the United States approves, and shall account for all monies derived from the sale of the assets sold by the Divestiture Trustee and all costs and expenses so incurred. After approval by the Court of the Divestiture Trustee’s accounting, including fees for its services and those of any professionals and agents retained by the Divestiture Trustee, all remaining money shall be paid to Sellers and the trust shall then be terminated. The compensation of the Divestiture Trustee and any professionals and agents retained by the Divestiture Trustee shall be reasonable in light of the value of the Divestiture Assets and based on a fee arrangement providing the Divestiture Trustee with an incentive based on the price and terms of the divestiture and the speed with which it is accomplished, but timeliness is paramount. F. Defendants shall use their best efforts to assist the Divestiture Trustee in accomplishing the required divestiture. The Divestiture Trustee and any consultants, accountants, attorneys, and other persons retained by the Divestiture Trustee shall have full and complete access to the personnel, books, records, and facilities of the business to be divested, and Defendants shall develop financial and other information relevant to such business as the Divestiture Trustee may reasonably request, subject to reasonable protection for trade secret or other confidential research, development, or commercial information. Defendants shall take no action to interfere with or to impede the Divestiture Trustee’s accomplishment of the divestiture. G. After its appointment, the Divestiture Trustee shall file monthly reports with the United States and the Court setting forth the Divestiture Trustee’s efforts to accomplish the divestiture ordered under this Final Judgment. To the extent such reports contain information that the Divestiture Trustee deems confidential, such reports shall not be filed in the public docket of the Court. Such reports shall include the name, address, and telephone number of each person who, E:\FR\FM\22MYN2.SGM 22MYN2 30420 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices TKELLEY on DSK3SPTVN1PROD with NOTICES2 during the preceding month, made an offer to acquire, expressed an interest in acquiring, entered into negotiations to acquire, or was contacted or made an inquiry about acquiring the Divestiture Assets, and shall describe in detail each contact with any such person. The Divestiture Trustee shall maintain full records of all efforts made to divest the Divestiture Assets. H. If the Divestiture Trustee has not accomplished the divestiture ordered under this Final Judgment within six (6) months after its appointment, the Divestiture Trustee shall promptly file with the Court a report setting forth (1) the Divestiture Trustee’s efforts to accomplish the required divestiture, (2) the reasons, in the Divestiture Trustee’s judgment, why the required divestiture has not been accomplished, and (3) the Divestiture Trustee’s recommendations. To the extent such reports contain information that the Divestiture Trustee deems confidential, such reports shall not be filed in the public docket of the Court. The Divestiture Trustee shall at the same time furnish such report to the Defendants and to the United States, which shall have the right to make additional recommendations consistent with the purpose of the trust. The Court thereafter shall enter such orders as it shall deem appropriate to carry out the purpose of the Final Judgment, which may, if necessary, include extending the trust and the term of the Divestiture Trustee’s appointment by a period requested by the United States. VII. Notice of Proposed Divestiture A. Within two (2) business days following execution of a definitive divestiture agreement with an Acquirer other than Constellation, the Defendants or the Divestiture Trustee, whichever is then responsible for effecting the divestiture required herein, shall notify the United States of any proposed divestiture required by Section IV of this Final Judgment. If the Divestiture Trustee is responsible, it shall similarly notify Defendants. The notice shall set forth the details of the proposed divestiture and list the name, address, and telephone number of each person who offered or expressed an interest in or desire to acquire any ownership interest in the Divestiture Assets or, in the case of the Divestiture Trustee, any update of the information required to be provided under Section VI.G above. B. Within fifteen (15) calendar days of receipt by the United States of such notice, the United States may request from Defendants, the proposed Acquirer, any other third party, or the Divestiture Trustee if applicable, additional information concerning the VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 proposed divestiture, the proposed Acquirer, and any other potential Acquirer. Defendants and the Divestiture Trustee shall furnish any additional information requested within fifteen (15) calendar days of the receipt of the request, unless the parties shall otherwise agree. C. Within thirty (30) calendar days after receipt of the notice or within twenty (20) calendar days after the United States has been provided the additional information requested from Defendants, the proposed Acquirer, any third party, and the Divestiture Trustee, whichever is later, the United States shall provide written notice to Defendants and the Divestiture Trustee, stating whether or not it objects to the proposed divestiture. If the United States provides written notice that it does not object, the divestiture may be consummated, subject only to Defendants’ limited right to object to the sale under Section VI.D of this Final Judgment. Absent written notice that the United States does not object to the proposed Acquirer or upon objection by the United States, a divestiture proposed under Section VI shall not be consummated. Upon objection by Defendants under Section VI.D, a divestiture proposed under Section VI shall not be consummated unless approved by the Court. VIII. Monitoring Trustee A. Upon the filing of this Final Judgment, the United States may, in its sole discretion, appoint a Monitoring Trustee, subject to approval by the Court. B. The Monitoring Trustee shall have the power and authority to monitor Defendants’ compliance with the terms of this Final Judgment and the Hold Separate Stipulation and Order entered by this Court, and shall have such powers as this Court deems appropriate. The Monitoring Trustee shall be required to investigate and report on the Defendants’ compliance with this Final Judgment and the Defendants’ progress toward effectuating the purposes of this Final Judgment, including but not limited to: 1. The attainment of the construction milestones by the Acquirer as set forth in Section V.A, the reasons for any failure to meet such milestones, and recommended remedies for any such failure; 2. any breach or other problem that arises under the Transition Services Agreement, Interim Supply Agreement, or other agreement between Sellers and Acquirer that may affect the accomplishment of the purposes of this Final Judgment, the reasons for such PO 00000 Frm 00022 Fmt 4701 Sfmt 4703 breach or problem, and recommended remedies therefor; and 3. any breach or other concern regarding the accuracy of the representations made by ABI in sections 3.25 and 3.26 of the Stock Purchase Agreement, incorporated herein, or successor agreements thereto, and by Modelo in the Letter of Grupo Modelo, S.A.B. de C.V., incorporated herein as Exhibit C, and recommended remedies therefor. C. Subject to Section VIII.E of this Final Judgment, the Monitoring Trustee may hire at the cost and expense of ABI, any consultants, accountants, attorneys, or other persons, who shall be solely accountable to the Monitoring Trustee, reasonably necessary in the Monitoring Trustee’s judgment. D. Defendants shall not object to actions taken by the Monitoring Trustee in fulfillment of the Monitoring Trustee’s responsibilities under any Order of this Court on any ground other than the Monitoring Trustee’s malfeasance. Any such objections by Defendants must be conveyed in writing to the United States and the Monitoring Trustee within ten (10) calendar days after the action taken by the Monitoring Trustee giving rise to the Defendants’ objection. E. The Monitoring Trustee shall serve at the cost and expense of ABI on such terms and conditions as the United States approves. The compensation of the Monitoring Trustee and any consultants, accountants, attorneys, and other persons retained by the Monitoring Trustee shall be on reasonable and customary terms commensurate with the individuals’ experience and responsibilities. The Monitoring Trustee shall, within three (3) business days of hiring any consultants, accountants, attorneys, or other persons, provide written notice of such hiring and the rate of compensation to ABI. F. The Monitoring Trustee shall have no responsibility or obligation for the operation of Defendants’ businesses. G. Defendants shall use their best efforts to assist the Monitoring Trustee in monitoring Defendants’ compliance with their individual obligations under this Final Judgment and under the Hold Separate Stipulation and Order. The Monitoring Trustee and any consultants, accountants, attorneys, and other persons retained by the Monitoring Trustee shall have full and complete access to the personnel, books, records, and facilities relating to compliance with this Final Judgment, subject to reasonable protection for trade secret or other confidential research, development, or commercial E:\FR\FM\22MYN2.SGM 22MYN2 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices information or any applicable privileges. Defendants shall take no action to interfere with or to impede the Monitoring Trustee’s accomplishment of its responsibilities. H. After its appointment, the Monitoring Trustee shall file reports every ninety (90) days, or more frequently as needed, with the United States, the Defendants and the Court setting forth the Defendants’ efforts to comply with their individual obligations under this Final Judgment and under the Hold Separate Stipulation and Order. To the extent such reports contain information that the trustee deems confidential, such reports shall not be filed in the public docket of the Court. I. The Monitoring Trustee shall serve until the divestiture of all the Divestiture Assets is finalized pursuant to either Section IV or Section VI of this Final Judgment and the Transition Services Agreement and the Interim Supply Agreement have expired and all other relief has been completed as defined in Section V.A. IX. Financing Sellers shall not finance all or any part of any purchase made pursuant to Section IV or VI of this Final Judgment. TKELLEY on DSK3SPTVN1PROD with NOTICES2 X. Hold Separate Until the divestiture required by this Final Judgment has been accomplished, Defendants shall take all steps necessary to comply with the Hold Separate Stipulation and Order entered by this Court. Defendants shall take no action that would jeopardize the divestiture ordered by this Court. XI. Affidavits A. Within twenty (20) calendar days of the filing of this proposed Final Judgment, and every thirty (30) calendar days thereafter until the divestiture has been completed under Section IV or VI, each Seller shall deliver to the United States an affidavit as to the fact and manner of its compliance with Section IV or VI of this Final Judgment. Each such affidavit shall include the name, address, and telephone number of each person who, during the preceding thirty (30) calendar days, made an offer to acquire, expressed an interest in acquiring, entered into negotiations to acquire, or was contacted or made an inquiry about acquiring, any interest in the Divestiture Assets, and shall describe in detail each contact with any such person during that period. Each such affidavit shall also include a description of the efforts Sellers have taken to solicit buyers for the Divestiture Assets, and to provide VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 required information to prospective Acquirers, including the limitations, if any, on such information. Assuming the information set forth in the affidavit is true and complete, any objection by the United States to information provided by Sellers, including limitation on information, shall be made within fourteen (14) calendar days of receipt of such affidavit. B. Within twenty (20) calendar days of the filing of this proposed Final Judgment, each Defendant shall deliver to the United States an affidavit that describes in reasonable detail all actions it has taken and all steps it has implemented on an ongoing basis to comply with Section X of this Final Judgment. Each Defendant shall deliver to the United States an affidavit describing any changes to the efforts and actions outlined in its earlier affidavits filed pursuant to this section within fifteen (15) calendar days after the change is implemented. C. Defendants shall keep all records of all efforts made to preserve and divest the Divestiture Assets until one year after such divestiture has been completed. XII. Notification of Future Transactions A. Unless such transaction is otherwise subject to the reporting and waiting period requirements of the HartScott-Rodino Antitrust Improvements Act of 1976, as amended, 15 U.S.C. 18a (the ‘‘HSR Act’’), ABI, without providing at least sixty (60) calendar days advance notification to the United States, shall not directly or indirectly acquire or license a Covered Interest in or from a Covered Entity; provided, however, that advance notification shall not be required for acquisitions of the type addressed in 16 CFR 802.1 and 802.9. B. Any notification pursuant to Section XII.A above shall be provided to the United States in letter format, and shall identify the parties to the transaction, the assets being acquired or licensed, the value of the transaction, the seller’s annual gross revenue from each brand or asset being acquired, and the identity of the current importer for any Beer being acquired that is brewed outside the United States. C. All references to the HSR Act in this Final Judgment refer to the HSR Act as it exists at the time of the transaction or agreement and incorporate any subsequent amendments to the Act. XIII. Firewall A. During the term of the Transition Services Agreement and the Interim Supply Agreement, Sellers shall implement and maintain reasonable PO 00000 Frm 00023 Fmt 4701 Sfmt 4703 30421 procedures to prevent Acquirer Confidential Information from being disclosed by or through Sellers to those of Sellers’ affiliates who are involved in the marketing, distribution, or sale of Beer in the United States, or to any other person who does not have a need to know the information. B. Sellers shall, within ten (10) business days of the entry of the Hold Separate Stipulation and Order, submit to the United States a document setting forth in detail the procedures implemented to effect compliance with Section XIII.A of this Final Judgment. The United States shall notify Sellers within five (5) business days whether it approves of or rejects Sellers’ compliance plan, in its sole discretion. In the event that Sellers’ compliance plan is rejected, the reasons for the rejection shall be provided to Sellers and Sellers shall be given the opportunity to submit, within ten (10) business days of receiving the notice of rejection, a revised compliance plan. If the parties cannot agree on a compliance plan, the United States shall have the right to request that the Court rule on whether Sellers’ proposed compliance plan is reasonable. C. Defendants may at any time submit to the United States evidence relating to the actual operation of the firewall in support of a request to modify the firewall set forth in this Section XIII. In determining whether it would be appropriate for the United States to consent to modify the firewall, the United States, in its sole discretion, shall consider the need to protect Acquirer Confidential Information and the impact the firewall has had on Sellers’ ability to efficiently provide services, supplies and products under the Transition Services Agreement and the Interim Supply Agreement. D. Sellers and the Acquirer shall: 1. furnish a copy of this Final Judgment and related Competitive Impact Statement within sixty (60) days of entry of the Final Judgment to (a) each officer, director, and any other employee that will receive Acquirer Confidential Information; (b) each officer, director, and any other employee that is involved in (i) any contact with the other companies that are parties to the Transition Services Agreement and Interim Supply Agreement, (ii) making decisions under the Transition Services Agreement or the Interim Supply Agreement, (iii) making decisions regarding ABI’s Distributor Incentive Programs, or (iv) making decisions regarding the treatment of Crown by either ABIOwned Distributors, or by any other Distributor in which ABI acquires a E:\FR\FM\22MYN2.SGM 22MYN2 30422 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices majority interest after the date of the divestiture contemplated herein; and (c) any successor to a person designated in Section XIII.D.1(a) or (b); 2. annually brief each person designated in Section XIII.D.1 on the meaning and requirements of this Final Judgment and the antitrust laws; and 3. obtain from each person designated in Section XIII.D.1, within sixty (60) days of that person’s receipt of the Final Judgment, a certification that he or she (i) has read and, to the best of his or her ability, understands and agrees to abide by the terms of this Final Judgment; (ii) is not aware of any violation of the Final Judgment that has not been reported to the company; and (iii) understands that any person’s failure to comply with this Final Judgment may result in an enforcement action for civil or criminal contempt of court against each Defendant and/or any person who violates this Final Judgment. TKELLEY on DSK3SPTVN1PROD with NOTICES2 XIV. Compliance Inspection A. For the purposes of determining or securing compliance with this Final Judgment, or of determining whether the Final Judgment should be modified or vacated, and subject to any legally recognized privilege, from time to time authorized representatives of the United States Department of Justice Antitrust Division (‘‘Antitrust Division’’), including consultants and other persons retained by the United States, shall, upon written request of an authorized representative of the Assistant Attorney General in charge of the Antitrust Division, and on reasonable notice to Defendants, be permitted: 1. Access during Defendants’ office hours to inspect and copy, or at the option of the United States, to require Defendants to provide hard copy or electronic copies of, all books, ledgers, accounts, records, data, and documents in the possession, custody, or control of Defendants, relating to any matters contained in this Final Judgment; and 2. to interview, either informally or on the record, Defendants’ officers, employees, or agents, who may have their individual counsel present, regarding such matters. The interviews shall be subject to the reasonable convenience of the interviewee and without restraint or interference by Defendants. VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 B. Upon the written request of an authorized representative of the Assistant Attorney General in charge of the Antitrust Division, Defendants shall submit written reports or respond to written interrogatories, under oath if requested, relating to any of the matters contained in this Final Judgment as may be requested. Written reports authorized under this paragraph may, at the sole discretion of the United States, require Defendants to conduct, at Defendants’ cost, an independent audit or analysis relating to any of the matters contained in this Final Judgment. C. No information or documents obtained by the means provided in this section shall be divulged by the United States to any person other than an authorized representative of the executive branch of the United States, except in the course of legal proceedings to which the United States is a party (including grand jury proceedings), or for the purpose of securing compliance with this Final Judgment, or as otherwise required by law. D. If at the time information or documents are furnished by Defendants to the United States, Defendants represent and identify in writing the material in any such information or documents to which a claim of protection may be asserted under the Protective Order, then the United States shall give Defendants ten (10) calendar days notice prior to divulging such material in any legal proceeding (other than a grand jury proceeding). insolvency or reorganization (‘‘Foreign Bankruptcy Law’’), (a) the Sub-License Agreement will not be deemed to be an executory contract, and (b) if for any reason the Sub-License Agreement is deemed to be an executory contract, the licenses granted under the Sub-License Agreement shall be deemed to be licenses to rights in ‘‘intellectual property’’ as defined in Section 101 of the Bankruptcy Code or any analogous provision of Foreign Bankruptcy Law and Constellation or any other Acquirer shall be protected in the continued enjoyment of its right under the SubLicense Agreement including, without limitation, if Constellation or another Acquirer so elects, the protection conferred upon licensees under 11 U.S.C. Section 365(n) of the Bankruptcy Code or any analogous provision of Foreign Bankruptcy Law. XV. No Reacquisition Sellers may not reacquire any part of the Divestiture Assets during the term of this Final Judgment. Entry of this Final Judgment is in the public interest. The parties have complied with the requirements of the Antitrust Procedures and Penalties Act, 15 U.S.C. 16, including making copies available to the public of this Final Judgment, the Competitive Impact Statement, and any comments thereon and the United States’ responses to comments. Based upon the record before the Court, which includes the Competitive Impact Statement and any comments and response to comments filed with the Court, entry of this Final Judgment is in the public interest. XVI. Bankruptcy The failure of any party to the SubLicense Agreement to perform any remaining obligations of such party under the Sub-License Agreement shall not excuse performance by the other party of its obligations thereunder. Accordingly, for purposes of Section 365(n) of the Bankruptcy Reform Act of 1978, as amended, and codified as 11 U.S.C. 101 et seq. (the ‘‘Bankruptcy Code’’) or any analogous provision under any law of any foreign or domestic, federal, state, provincial, local, municipal or other governmental jurisdiction relating to bankruptcy, PO 00000 Frm 00024 Fmt 4701 Sfmt 4703 XVII. Retention of Jurisdiction This Court retains jurisdiction to enable any party to this Final Judgment to apply to this Court at any time for further orders and directions as may be necessary or appropriate to carry out or construe this Final Judgment, to modify any of its provisions, to ensure and enforce compliance, and to punish violations of its provisions. XVIII. Expiration of Final Judgment Unless this Court grants an extension, this Final Judgment shall expire ten (10) years from the date of its entry. XIX. Public Interest Determination Dated: lllllllllllllllll Court approval subject to procedures of the Antitrust Procedures and Penalties Act, 15 U.S.C. 16. lllllllllllllllllllll United States District Judge E:\FR\FM\22MYN2.SGM 22MYN2 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00127-RWR Document35-1 Filed 04/24113 30423 10f235 STOCK P(TRCHASE AGREEMENT bebnen ANHlmSI;:R-RIISCH INRlW SA/NV and CONSTELLA TION BIl4.NDS, INC. VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00025 Fmt 4701 13,2013 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.004</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 tebmalI'V 30424 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00127-RWR Document35-1 Filed 04/24/13 20f235 TABLE OF CONTENTS CLOSING I.l I [I 1 2.2 REGARDING THE ARTlCLf: III REPRf:Sf:NTATlONS I 3.2 3.3 3.4 3.5 3.7 3.8 3.9 10 11 II 11 1 11 II 3.22 17 17 17 3.25 VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00026 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.005</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 -i - 30425 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00127-RWR Document35-1 Filed 04/24/13 30f235 TABLE OF CONTENTS 4,7 ARTICLE I 21 5.2 5.3 ~!E!....~~,!;!,£!...1~!!:.!;!;.E!.il"'''''''''''''''''''''''''''''''''''''''''''''''''''''''''''''''''''' .............. 22 21 22 24 24 5.7 5.9 10 5.11 12 5.13 14 5.15 16 CONI)I'110NS TO 32 7.1 7.2 VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00027 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.006</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 - ii - 30426 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00127-RWR Document35-1 Filed 04/24/13 40f235 TABLE OF CONTENTS I'R()VISIONS." ................................................................................. . 10.1 10.2 52 53 53 53 HI. 5 53 EXHIHITS: ABIDlSCI.OSLJRE I.ETn:R lLL'vL.L 1.3-1 1.4-1 1.3 1.4 VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00028 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.007</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 iii - Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00127-RWR Document35-1 Filed 04/24113 30427 50f235 VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00029 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.008</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 R 30428 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00127-RWR Document35-1 Filed 04/24/13 60f235 VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00030 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.009</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 CLOSING Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00031 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 70f235 22MYN2 EN22MY13.010</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 Case 1:13-cv-00127-RWR Document35-1 Filed 04/24113 30429 30430 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00127-RWR Document35-1 Filed 04/24113 80f235 million. VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00032 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.011</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 -4- Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13~cv·00127-RWR Document 30431 Filed 04/24/13 '-l'Jl>'ltJ::~ CHI shall delh'L'T an Sbares to the eVloerlcll11g each ofthc the L'(J,mI}IIl1ll(.>g the s",II""rilv "h,'r"hnlltl""" VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00033 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.012</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 the 30432 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00127-RWR Document 35-1 Filed 04/24/13 10 of 235 ARTICLE II VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00034 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.013</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 OFABI Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00127-RWR Document 35-1 Filed 04/24/13 30433 11 of 235 VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00035 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.014</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 REGARDING THE COMPANIES Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices TKELLEY on DSK3SPTVN1PROD with NOTICES2 Case 1:13-cv-00127-RWR Document 35-1 Filed 04/24/13 VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00036 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 12 of 235 22MYN2 EN22MY13.015</GPH> 30434 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00037 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 13 of 235 22MYN2 EN22MY13.016</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 Case 1:13-cv-00127-RWR Document 35-1 Filed 04/24/13 30435 30436 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00127-RWR Document 35-1 Filed 04/24/13 14 of 235 to COI'ISUI:nrrlate the prevent VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00038 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.017</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 Catlacltv. in third pariy; Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00127-RWR Document 35-1 Filed 04/24/13 30437 15 of 235 EBlTDA VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00039 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.018</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 - 1- 30438 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00127-RWR Document 35-1 Filed 04/24/13 16 of 235 VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00040 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.019</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 Tllx Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00041 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 17 of 235 22MYN2 EN22MY13.020</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 case 1:13-cv-00127-RWR Document 35-1 Filed 04/24/13 30439 30440 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00127-RWR Document 35-1 Filed 04/24/13 18 of 235 'Ine CCC not mllep,mllent contractors. Section :t 17 of the VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00042 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.021</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 - 14- Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00127-RWR Document 35-1 Filed 04/24/13 30441 19 of 235 maintain.:d. Plan which or,>"",,,>,,t nor the consummation acceleration VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00043 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.022</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 . 15· 30442 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00127-RWR Document 35-1 Filed 04/24/13 20 of 235 3.22 Plant 1'' ' ' ' ' '"1"1.1 VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00044 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.023</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 in all material Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00127-RWR Document 35-1 Filed 04/24/13 30443 21 of 235 Environmental Disclosure Letter. of the VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00045 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.024</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 ·17· 30444 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00127-RWR Document 35-1 Filed 04/24/13 22 of 235 OF if 4.4 VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00046 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.025</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 not, and the "",rfortn,,,,,',, Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00127-RWR Document 35-1 Filed 04/24/13 30445 23 of 235 4.5 TKELLEY on DSK3SPTVN1PROD with NOTICES2 VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00047 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM Documents 22MYN2 EN22MY13.026</GPH> )rg:anll~itl(]'nal any class Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices TKELLEY on DSK3SPTVN1PROD with NOTICES2 Case 1:13-cv-00127-RWR Document 35-1 Filed 04/24/13 VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00048 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 24 of 235 22MYN2 EN22MY13.027</GPH> 30446 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00127-RWR Document 35-1 Filed 04/24/13 30447 25 of 235 to take, with each other ill transactions 1.'OlrltClnl)la:tcd VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00049 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.028</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 -21- 30448 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00127-RWR Document 35-1 Filed 04/24/13 26 of 235 VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00050 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.029</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 - 22- 30449 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00127-RWR Document 35-1 Filed 04/24/13 27 of 235 VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00051 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.030</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 to 30450 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00127-RWR Document 35-1 Filed 04/24/13 28 of 235 to the Debt Finmll::ing. On and ).7 Dat..:: VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00052 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.031</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 ·24· Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00127-RWR Document 35-1 Filed 04/24/13 011 30451 29 of 235 slich tenus, 5.8 Date: VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00053 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.032</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 - 25- 30452 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00127-RWR Document 35-1 Filed 04/24/13 30 of 235 and may affect shall not VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00054 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.033</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 - 26- Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00055 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 31 of 235 22MYN2 EN22MY13.034</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 case 1:13-cv-00127-RWR Document 35-1 Filed 04/24/13 30453 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices TKELLEY on DSK3SPTVN1PROD with NOTICES2 case 1:13-cv-00127-RWR Document 35-1 Filed 04/24/13 VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00056 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 32 of 235 22MYN2 EN22MY13.035</GPH> 30454 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00057 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 33 of 235 22MYN2 EN22MY13.036</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 case 1:13-cv-00127-RWR Document 35-1 Filed 04/24/13 30455 30456 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices case 1:13-cv-00127-RWR Document 35-1 Filed 04/24/13 34 of 235 VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00058 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.037</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 neither AHI nor tht!ir "."',,,,,,,,,_ Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00127-RWR Document 35-1 Filed 04/24/13 30457 35 of 235 VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00059 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.038</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 5.]5 30458 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00127-RWR Document 35-1 Filed 04/24/13 36 of 235 tr"not.."" shall be eo(m,,~ral:e with the VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00060 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.039</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 cm in accordance with Section 5.1 L 30459 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00127-RWR Document 35-1 Filed 04/24/13 37 of 235 transaction cOll~;;np.lai:;dh:~~d:~:U~~; Parties at or remained U!o,,.,.o,,HI'<l 7.1 in this A~,.e,ement lind the VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00061 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.040</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 the Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices TKELLEY on DSK3SPTVN1PROD with NOTICES2 Case 1:13-cv-00127-RWR Document 35-1 Filed 04/24/13 VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00062 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 38 of 235 22MYN2 EN22MY13.041</GPH> 30460 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00063 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 39 of 235 22MYN2 EN22MY13.042</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 Case 1:13-cv-00127-RWR Document 35-1 Filed 04/24/13 30461 30462 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00127-RWR Document 35-1 Filed 04/24/13 40 of 235 VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00064 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.043</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 each such VVI"!<i'UHJU Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00127-RWR Document 35-1 Filed 04/24/13 30463 41 of 235 COJlltu:ctJion with ARTICLE VIII TERMINA1101" be tL'mIinated at 8.1 lUl:'{ time the Date: if the MIPA tenninated AHI or CHI pursuant VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00065 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM MIPA under 22MYN2 EN22MY13.044</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 tCT]'1111'Iate the 30464 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00127-RWR Document 35-1 Filed 04/24/13 42 of 235 DEFINITIONS the in of which is VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00066 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.045</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 forth in Section Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00067 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 43 of 235 22MYN2 EN22MY13.046</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 case 1:13-cv-00127-RWR Document 35-1 Filed 04/24/13 30465 30466 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices case 1:13-cv-00127-RWR Document 35-1 Filed 04/24/13 44 of 235 I) the For included: Inll"""ltlrO hanks in the 4L VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00068 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.047</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 in Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices case 1:13-cv-00127-RWR Document 35-1 Filed 04/24/13 30467 45 of 235 1.2. lI. Iill ion forth in Section VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00069 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.048</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 ·41- 30468 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices case 1:13-cv-00127-RWR Document 35-1 Filed 04/24/13 MS:.!£!:..;!;;l!!.!!!!iIill.!,!;. the meamllll! ~!1l!!;1!.!2!~; 46 of 235 in the ""','''ntO the de For identifiable such in the h. VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00070 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.049</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 d. Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices case 1:13-cv-00127-RWR Document 35-1 Filed 04/24/13 30469 47 of 235 Return VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00071 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.050</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 ·43 - 30470 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices case 1:13-cv-00127-RWR Document 35-1 Filed 04/24/13 48 of 235 forth in Section 4.8. III Plant Beer per lnCluslna Vidriera VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00072 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.051</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 ·44- Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices case 1:13-cv-00127-RWR Document 35-1 Filed 04/24/13 30471 49 of 235 Indemnified rnrth in Section VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00073 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.052</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 ·45 - 30472 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices case 1:13-cv-00127-RWR Document 35-1 Filed 04/24/13 50 of 235 and "n-"n1m"mT,,1 the /\mnnnl'v or other m""mlll<r VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00074 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.053</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 the Recitals_ Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices case 1:13-cv-00127-RWR Document 35-1 Filed 04/24/13 defined 30473 51 of 235 the VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00075 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.054</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 ·47 - 30474 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices case 1:13-cv-00127-RWR Document 35-1 Filed 04/24/13 52 of 235 Date, the 111", Dnle, "",,""',' Period that or il1 LL Section 5,2, VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00076 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.055</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 in the Recitals. Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices case 1:13-cv-00127-RWR Document 35-1 Filed 04/24/13 30475 53 of 235 fhl1h VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00077 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.056</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 in 30476 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices case 1:13-cv-00127-RWR Document 35-1 Filed 04/24/13 54 of 235 VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00078 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.057</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 stated Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00127-RWR Document 35-1 Filed 04/24/13 30477 55 of 235 the correSlDOll1Q1I11lZ 10.2 certificates and other party in I'ttf'".fml' the transactions cOItltemllla:ted Ifto VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00079 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.058</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 shall 30478 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00127-RWR Document 35-1 Filed 04/24/13 56 of 235 If to VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 shall not COflstiltute PO 00000 Frm 00080 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.059</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 with Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00127-RWR Document 35-1 Filed 04/24/13 30479 57 of 235 VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00081 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.060</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 the 30480 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00127-RWR Document 35-1 Filed 04/24/13 58 of 235 VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00082 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.061</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 - 54- Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00083 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM S9 of 23S 22MYN2 EN22MY13.062</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 case 1:13-cv-00127-RWR Document 35-1 Filed 04/24/13 30481 30482 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00127-RWR Document 35-1 Filed 04/24/13 have rNWITNESS written above. 60 of 235 ex.ecuted of the ANHEUSER-BUSCH INBEV SAINV CONSTELLAnON BRA'IDS.INC. Name: VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00084 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.063</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 Title: Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00127-RWR Document 35-1 Filed 04/24/13 ANHIWSF~lt-HtJSCIi VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00085 Fmt 4701 Sfmt 4725 61 of 235 I Nm;:v SA/NY BRANUS, E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.064</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 CONSTF:U~ATION 30483 30484 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices case 1:13-cv-00127-RWR Document 35-1 Filed 04/24/13 62 of 235 EXUmlTC EXAMPLE OF EBlTDA CALCULATION VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00086 Fmt 4701 1 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.065</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 C Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices case 1:13-cv-00127-RWR Document 35-1 Filed 04/24/13 30485 63 of 235 VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00087 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.066</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 1- 1 30486 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices case 1:13-cv-00127-RWR Document 35-1 Filed 04/24/13 64 of 235 VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00088 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.067</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 -1 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices case 1:13-cv-00127-RWR Document 35-1 Filed 04/24/13 30487 65 of 235 VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00089 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.068</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 -1 30488 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices case 1:13-cv-00127-RWR Document 35-1 Filed 04/24/13 66 of 235 ,nR~n AMENDMENT TO STOCK PllRCIIASE AGR.~K\U;NT THIS FIRST AMENDMENT TO STOCK PIJRCIIASE AGREEMENT to amend thc Agrecllllcl,lt NOW, TUt:RIU,'ORK in consideration !IIld valuable and exhibit VerDate Mar<15>2010 21:24 May 21, 2013 deleted Jkt 229001 PO 00000 Frm 00090 Fmt 4701 Sfmt 4725 !IIld ,,:-rllli1:ea with E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.069</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 5. Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices case 1:13-cv-00127-RWR Document 35-1 Filed 04/24/13 30489 67 of 235 in 16 and replact:d Exhibit VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00091 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.070</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 Exhihit B 30490 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices case 1:13-cv-00127-RWR Document 35-1 Filed 04/24/13 68 of 235 -3L A mc<,<",,,,,,,t shall VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00092 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.071</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 remain um:nan2.:u Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00127-RWR Document 35-1 Filed 04/24/13 IN WITNESS WEIEREOK the 30491 69 of 235 executed ANElE10SE:R·JJUSCHINBEVSNNV VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00093 Fmt 4701 Sfmt 4725 INC. E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.072</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 CONSTELLATION 30492 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00127-RWR Document 35-1 Filed 04/24/13 IN WITNESS WHEREOF. the 70 of 235 have aftlle date written ANIIEUSER-BUSCIIINBEV SAINV Title: By: Title: VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00094 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.073</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 CONSTELLATION BRANDS. INC. Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices case 1:13-cv-00127-RWR Document 35-1 Filed 04/24/13 30493 71 of 235 VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00095 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.074</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 ANNEXA 30494 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices case 1:13-cv-00127-RWR Document 35-1 Filed 04/24/13 72 of 235 EXHIBIT A VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00096 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.075</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 FORM OF LICENSE AGREEMENT Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices case 1:13-cv-00127-RWR Document 35-1 Filed 04/24/13 30495 73 of 235 EXHIBIT A TO FIRST AMENDMENT TO STOCK PURCIIASE AGREEMENT Ai\IENDED AND RESTATED SleB-LICENSE AGREEMENT BETWEEN m:cv. AND CONSn:LLATlON BE(t:RS 1./fl), VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00097 Fmt 4701 2013 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.076</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 DATED: 30496 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices case 1:13-cv-00127-RWR Document 35-1 Filed 04/24/13 74 of 235 Ltd., AnhellStlr-Husch InHev C onstella1.ion Brands Products VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00098 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.077</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 2 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices case 1:13-cv-00127-RWR Document 35-1 Filed 04/24/13 30497 75 of 235 ARTlCI,}t; I DEFINITIONS Ae:reclmcl~t U set forth below: thc the trademark amelld~-d Sediun 9.11, "Barton" TKELLEY on DSK3SPTVN1PROD with NOTICES2 VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00099 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.078</GPH> in the Recitals, "Beaell lIolding!," 30498 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices case 1:13-cv-00127-RWR Document 35-1 Filed 04/24/13 76 of 235 'I'radenmrk Brand l::,XIClltSI(il1 "Brand Extension Beer" "lJrand (;uidelines"me:ll1s Product an Interim Product or T mom'! "T VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00100 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.079</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 4 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices 30499 77 of 235 case 1:13-cv-00127-RWR Document 35-1 Filed 04/24/13 ill Set'tion 9.6, "Constellation" that teml 111 the Redtal:;;. "Constellation Beers" include of Constc11ation that (1)nn in Section 5.2, "(:ontainer" means r.:cepllaclle in which "Crown" has the I'rcamlble, Beer "Crown Sub-License" Section 5.1, that that tenn in the Recitals, "Edmde II" VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00101 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.080</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 5 30500 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices case 1:13-cv-00127-RWR Document35-1 Filed 04/24/13 Ole 78 of 235 in Seetioll 9.11, "''',H",au "'")llll''''' de "Interim Product" mcans Product sUJlplllCd to Constellation thc Interinl VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00102 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.081</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 in Section S.3. Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices case 1:13-cv-00127-RWR Document 35-1 Filed 04/24/13 30501 79 of 235 dilltributioll and that ternl the Recitals. in S«tion 5.1. "Modelo Indannitees" VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00103 Fmt 4701 Parent Trademark. Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.082</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 Product 30502 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices case 1:13-cv-00127-RWR Document 35-1 Filed 04/24/13 80 of 235 Mark "Pt.-rmltted Seetion thllt tenn in Rert'Fl'Dl'(-" . . . . . . ~I"h, Default Cure Failure" "n,.. ~I"+.. Default CUrt' .'allure Notice" has the mf,an:mg Seetloll that teml ill St'ction VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00104 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.083</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 Default Notice" Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices case 1:13-cv-00127-RWR Document 35-1 Filed 04/24/13 30503 81 of 235 VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00105 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.084</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 Con;;tellatioll 30504 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices case 1:13-cv-00127-RWR Document 35-1 Filed 04/24/13 82 of 235 be IlInendcd or sUI:>pII..'1l1tClltcd "{!SPTO" 1.2 ConstrueD on documents thercio. VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00106 shall be Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 11 nlied Staies 22MYN2 EN22MY13.085</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 al1l;ounts In Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices case 1:13-cv-00127-RWR Document 35-1 Filed 04/24/13 30505 83 of 235 ARnCLEII GRANT 01<' LICENSE, INn~LLl~C1TAL PROPI<:RTY; SliPPLY VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00107 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.086</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 11 30506 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices case 1:13-cv-00127-RWR Document 35-1 Filed 04/24/13 84 of 235 VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00108 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.087</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 12 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices case 1:13-cv-00127-RWR Document 35-1 Filed 04/24/13 30507 85 of 235 VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00109 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.088</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 13 30508 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices case 1:13-cv-00127-RWR Document 35-1 Filed 04/24/13 86 of 235 of the Trademark.,>~ H",'!."""':~ VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00110 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.089</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 14 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices case 1:13-cv-00127-RWR Document 35-1 Filed 04/24/13 and 30509 87 of 235 lInT'''~lI'',u",,~ r~:as·(lnaiDIV corlsisltcnl VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00111 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.090</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 Jlotlelo, Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices TKELLEY on DSK3SPTVN1PROD with NOTICES2 case 1:13-cv-00127-RWR Document 35-1 Filed 04/24/13 VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00112 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 88 of 235 22MYN2 EN22MY13.091</GPH> 30510 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices case 1:13-cv-00127-RWR Document 35-1 Filed 04/24/13 30511 89 of 235 Sub-Licetlses VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00113 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.092</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 17 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices case 1:13-cv-00127-RWR Document 35-1 Filed 04/24/13 TKELLEY on DSK3SPTVN1PROD with NOTICES2 IIIaintenance VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00114 90 of 235 TTlirdeJmarkg ami Licenged Other 11" Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.093</GPH> 30512 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices case 1:13-cv-00127-RWR Document 35-1 Filed 04/24/13 30513 91 of 235 VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00115 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.094</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 Exhihit D. Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices TKELLEY on DSK3SPTVN1PROD with NOTICES2 case 1:13-cv-00127-RWR Document 35-1 Filed 04/24/13 VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00116 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 92 of 235 22MYN2 EN22MY13.095</GPH> 30514 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices case 1:13-cv-00127-RWR Document 35-1 Filed 04/24/13 30515 93 of 235 lilies company, division, any of the Tr,,,I,,,,,,,,rIi,, Trademar~., or described in Section "",,,,nn.',,," VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00117 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.096</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 21 30516 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices case 1:13-cv-00127-RWR Document 35-1 Filed 04/24/13 94 of 235 to !iuch Trademark in if !>uch with another Trademark included in f<;xbibit n the VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00118 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.097</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 tenns, conditions Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00119 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 95 of 235 22MYN2 EN22MY13.098</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 case 1:13-cv-00127-RWR Document 35-1 Filed 04/24/13 30517 30518 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices case 1:13-cv-00127-RWR Document 35-1 Filed 04/24/13 96 of 235 VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00120 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.099</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 24 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00121 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 97 of 235 22MYN2 EN22MY13.100</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 case 1:13-cv-00127-RWR Document 35-1 Filed 04/24/13 30519 30520 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices case 1:13-cv-00127-RWR Document 35-1 Filed 04/24/13 98 of 235 ARTlcu:m VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00122 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.101</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 CONTROL Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00123 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 99 of 235 22MYN2 EN22MY13.102</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 case 1:13-cv-00127-RWR Document 35-1 Filed 04/24/13 30521 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices TKELLEY on DSK3SPTVN1PROD with NOTICES2 Case 1:13-cv-00121-RWR Document 35-1 Filed 04/24113 VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00124 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 100 of 235 22MYN2 EN22MY13.103</GPH> 30522 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00121-RWR Document 35-1 Filed 04/24113 30523 101 of 235 ARTlCU: IV TERM VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00125 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.104</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 ARTlCI,.: v INDEMNIFICATION AND INSlJlL\NCE 30524 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00121-RWR Document 35-1 Filed 04/24113 102 of 235 VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00126 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.105</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 _~RTICU·: VI (;QVI':RNIN£:: LAW ANI) .JlTRISmCTION Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00121-RWR Document 35-1 Filed 04/24113 30525 103 of 235 ARTlCI.,E HI CONFIDENTIALITY VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00127 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.106</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 31 30526 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00121-RWR Document 35-1 Filed 04/24113 104 of 235 VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00128 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.107</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 ARTICLI!:vm TAXES Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00121-RWR Document 35-1 Filed 04/24113 30527 105 of 235 ARTICl4E IX l\nsc.~1 ,LAN I<:cn: s atl:ectmg a and r.:almnable consid.:ration of directed VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00129 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.108</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 33 30528 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00121-RWR Document 35-1 Filed 04/24113 106 of 235 reference VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00130 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.109</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 Ifto Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00121-RWR Document 35-1 Filed 04/24113 30529 101 of 235 VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00131 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.110</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 l1otk~ Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices TKELLEY on DSK3SPTVN1PROD with NOTICES2 Case 1:13-cv-00121-RWR Document 35-1 Filed 04/24113 VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00132 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 108 of 235 22MYN2 EN22MY13.111</GPH> 30530 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00121-RWR Document 35-1 Filed 04/24113 30531 109 of 235 IN WITNESS WIIEREOF, til.:: first written MAR(.'AS MOm:LO, S.A. DI': CS. VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00133 Fmt 4701 Sfmt 4725 "al~pl11pT1,tl E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.112</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 to Sub-licmse 30532 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00121-RWR Document 35-1 Filed 04/24113 110 of 235 i<:xbibit A TRADEMARK APPLICATIONS & REGISTRATIONS TO BE VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00134 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.113</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 .Jurisdiction Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00121-RWR Document 35-1 Filed 04/24113 30533 111 of 235 Exhibit B Al)DlTIONAL 'fRAm:l\IARKS Jurisdiction VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00135 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.114</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 B-1 30534 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00121-RWR Document 35-1 Filed 04/24113 112 of 235 VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00136 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.115</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 B-2 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00137 Fmt 4701 Sfmt 4725 113 of 235 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.116</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 Case 1:13-cv-00121-RWR Document 35-1 Filed 04/24113 30535 30536 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00121-RWR Document 35-1 Filed 04/24113 114 of 235 EXUmlTC VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00138 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.117</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 BRAND (;nDEUNES Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00121-RWR Document 35-1 Filed 04/24113 30537 115 of 235 i<:xbibit D .Jurisdidiun VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00139 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.118</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 1)·1 30538 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00121-RWR Document 35-1 Filed 04/24113 116 of 235 Jurisdi{'tion VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00140 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.119</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 1)·2 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00121-RWR Document 35-1 Filed 04/24113 30539 111 of 235 Exhibit Eo CHELADA TR.\DEl\L.\RKS VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00141 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.120</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 Jurisdll't{on 30540 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00121-RWR Document 35-1 Filed 04/24113 118 of 235 Exhibit 1<' NON-EXCLUSIVE TRADEMARKS VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00142 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.121</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 Jurisdll't{on Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00121-RWR Document 35-1 Filed 04/24113 30541 119 of 235 EXHIBITB VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00143 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.122</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 FORM OF TRANSITION SERVICES AGREEMENT 30542 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00121-RWR Document 35-1 Filed 04/24113 120 of 235 EXHIBIT B TO FIRST AMENDMENT TO STOCK PURCHASE AGREEMENT TRANSITION SERVICES AGREEMENT 2013 dated ANHEliSI':R-RliSCH INRK\' SA/NY ami VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00144 Fmt 4701 D,,".~'~Ll''''. Sfmt 4725 INC. E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.123</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 CONSTIt:LLATION Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00121-RWR Document 35-1 Filed 04/24113 30543 121 of 235 TRANSITION SERVICES AGREEMENT the temul ARTICLE I INTERPRETATION VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00145 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.124</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 Seeiion Lot 30544 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00121-RWR Document 35-1 Filed 04/24113 122 of 235 or has the "'"'''"'''0 the tU';;''''''U):, similar Owner. VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00146 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.125</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 -2- Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00121-RWR Document 35-1 Filed 04/24113 30545 123 of 235 the ofthe m~~an'lng set forth ill ==""-'='"', of the VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00147 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.126</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 in connection with the 30546 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00121-RWR Document 35-1 Filed 04/24113 124 of 235 managcmcnt. ma,intclllmcc. installation information and IT ",''',len", VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00148 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.127</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 to Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00121-RWR Document 35-1 Filed 04/24113 30547 125 of 235 the in VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00149 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.128</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 10 30548 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00121-RWR Document 35-1 Filed 04/24113 ''''M11i,",~ 126 of 235 with ofa with the rvlodelo Se..;lion t""nn~r'Ahlt' rn"""iif'!<J' tenns defined in the VerDate Mar<15>2010 21:24 May 21, 2013 whlll1 lIsed in and Jkt 229001 PO 00000 Frm 00150 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.129</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 the Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00121-RWR Document 35-1 Filed 04/24113 and Unitl!d 30549 121 of 235 Dollars: this the lind lind its which or stilt ute agreements or m~;lnJlm,ml:!\) ARTlCu;:n VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00151 Fmt 4701 Sfmt 4725 mana~~ell1lent E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.130</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 the Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices TKELLEY on DSK3SPTVN1PROD with NOTICES2 Case 1:13-cv-00121-RWR Document 35-1 Filed 04/24113 VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00152 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 128 of 235 22MYN2 EN22MY13.131</GPH> 30550 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00121-RWR Document 35-1 Filed 04/24113 30551 129 of 235 monthll from the date O&A 1'>,~:rvl,ei~~ the VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00153 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.132</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 date oftbi,; Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices TKELLEY on DSK3SPTVN1PROD with NOTICES2 Case 1:13-cv-00121-RWR Document 35-1 Filed 04/24113 VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00154 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 130 of 235 22MYN2 EN22MY13.133</GPH> 30552 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00155 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 131 of 235 22MYN2 EN22MY13.134</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 Case 1:13-cv-00121-RWR Document 35-1 Filed 04/24113 30553 30554 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00121-RWR Document 35-1 Filed 04/24113 132 of 235 Section 2.11 VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00156 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.135</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 -2- Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00157 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 133 of 235 22MYN2 EN22MY13.136</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 Case 1:13-cv-00121-RWR Document 35-1 Filed 04/24113 30555 30556 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00121-RWR Document 35-1 Filed 04/24113 it InCICp,emll!ll11V 134 of 235 without States, ARTleLI': [II VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00158 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.137</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 COMPENSATION Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00121-RWR Document 35-1 Filed 04/24113 herein 30557 135 of 235 in '111ird Parli<l8. Purchas<ir, in accordance with ==~~= in,-"i.""" «nt)nn,rtIfH> '.!!:!.Yl:l~!§' shall d![)Clltnlmtat1{)!l forth in reasonable with to Out-of- Pocket VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00159 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.138</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 Business 30558 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00121-RWR Document 35-1 Filed 04/24113 136 of 235 VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00160 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.139</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 that neither Sdler l10r upon \lfthe Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00161 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 131 of 235 22MYN2 EN22MY13.140</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 Case 1:13-cv-00121-RWR Document 35-1 Filed 04/24113 30559 30560 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00121-RWR Document 35-1 Filed 04/24113 ARTICU~ 138 of 235 V VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00162 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.141</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 I,IMlTlm UAIlILlT,\' ANI) INm:MNIFICATION Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00121-RWR Document 35-1 Filed 04/24113 30561 139 of 235 TERMINATION VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00163 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.142</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 such 11, Section 2.12, swvive such tennination. 30562 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00121-RWR Document 35-1 Filed 04/24113 140 of 235 ARTICU:VU VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00164 PROVISIONS Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.143</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 GENERAI~ Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00121-RWR Document 35-1 Filed 04/24113 30563 141 of 235 If to Purchaser: VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00165 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.144</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 1- 30564 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00121-RWR Document 35-1 Filed 04/24113 142 of 235 VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00166 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.145</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 which shall Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00121-RWR Document 35-1 Filed 04/24113 and all and all 30565 143 of 235 reallorlabl~ {"\i~lIn1i'nl" hCl'eofal'c of the amount'! due or this or allY other Contract. VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00167 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.146</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 -13- 30566 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00121-RWR Document 35-1 Filed 04/24113 144 of 235 VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00168 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.147</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 lhtl VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00169 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 30567 EN22MY13.148</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices VerDate Mar<15>2010 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00170 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.149</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 30568 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00121-RWR Document 35-1 Filed 04/24113 30569 141 of 235 SERVICE COORDINATORS VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00171 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.150</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 l· JI 30570 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00121-RWR Document 35-1 Filed 04/24113 148 of 235 Schedule VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00172 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.151</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 S(TPPLY SERVICES Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00173 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 149 of 235 22MYN2 EN22MY13.152</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 Case 1:13-cv-00121-RWR Document 35-1 Filed 04/24113 30571 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices TKELLEY on DSK3SPTVN1PROD with NOTICES2 Case 1:13-cv-00121-RWR Document 35-1 Filed 04/24113 VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00174 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 150 of 235 22MYN2 EN22MY13.153</GPH> 30572 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00121-RWR Document 35-1 Filed 04/24113 30573 151 of 235 AMENDED AND REST;\TED MEMBERSHIP INTEREST PI;RCIUSE AGREI<:l\U:NT among CONSTI':U,ATION BI':I':RS LTI)', CONSTELLATION BRANDS BEACII IIOLDINGS, INC., CONSTELLATION INC., and ANHI<:IJSI<:R-RI;SCH INRI':'\' SA/NY VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00175 13,2013 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.154</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 renru,.n 30574 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00121-RWR Document 35-1 Filed 04/24113 152 of 235 ARTICLE I DEl,'INITIONS AND RI)LES OF CONSTRUCfION ........................................ 2 ,1 ARTICLE 2 PFRCHASE AND SALE OF THE CROWN INTEREST ................................ 10 I 10 11 11 ARTlCU: 3 THE CLOSING 13 1 U 13 14 ARTICLI<: "REI)RI<:SI':NTAT10NS AND WARRANTIES OF' AHI.. .................................. 15 1 15 15 15 16 4.5 16 16 16 17 ARTICLE 5 REPRESENTATIONS AND WARRltNTIES OF BUYERS AND CBL ........ 17 5,1 17 17 18 18 18 18 5.5 19 ARTICLE 6 AHI Guarantl'l' ...................................................................................................... 20 6,1 ARTICLE 7 CHI Guaranfl'l' ...................................................................................................... 22 TKELLEY on DSK3SPTVN1PROD with NOTICES2 VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00176 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.155</GPH> n ~l 30575 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00121-RWR Document 35-1 Filed 04/24113 153 of 235 7,2 ARTICLE 8 COVENANTS OF SELLER PARTIES ................................................... " ........... 24 I 15,2 24 ARTICLE 9 OTHER COVENANTS OF TIlE PARTIES 9,1 10 ARTICLE .to CONDITIONS TO CLOSING ................................................................................. 30 30 10,) 10.2 ARTICLE l.t TERl\<IINATION ................................................................................................. 31 1 31 :n ARTICLE 12 INDEl\INIFICATION ........................................................................................... 32 ]2,1 12.3 12.5 ARTICLE 13 TER:"\flNATlON OF JOINT VENTURE AGREEMENTS ........................... 36 ARTICLE 14 GENER:\L PROVISIONS ................................................................................. 37 )4,2 14,7 VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00177 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.156</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 14,10 30576 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00121-RWR Document 35-1 Filed 04/24113 154 of 235 EXIIIBITS SCHEDULES VerDate Mar<15>2010 21:24 May 21, 2013 Temlinated Jkt 229001 PO 00000 Frm 00178 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.157</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 Schedule 13.1 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00121-RWR Document 35-1 Filed 04/24113 30577 155 of 235 AMENDED AND RESTATED !\U:lVnmRSIUP INn:REST PURCHASE AGRJt;Jt;MI~NT 'rIns AM1~NDED AND RI~STATED MI~MRERSII1P IN'rImRST PURCIIASJt AGlU<~I'~MI<~NT WIT 1<: T II VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00179 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.158</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 into 30578 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00121-RWR Document 35-1 Filed 04/24113 156 of 235 em,(mam:lL agreements, and ,!aluable adm.',"'vl,,~d;,,~d the ARTICLE 1 DEFINITIONS AND RULES OF CONSTRUCTION used in 1.1 Ret forth below: "ADI" VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00180 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.159</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 forth in Section 6.1~ Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00121-RWR Document 35-1 Filed 04/24113 Preamble 30579 151 of 235 this Section 5.10, breach reT,re,:enlallon, warrant)', "B:revvt>I''V Transaction" of Constellation Beers "CBBIr "CBr' forth in Section 7.1, "CBI Intel'VSt" has has the m,~liIt'll:'l'l!" Secnon:U, VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00181 Fmt 4701 Sfmt 4725 forth in Section 14.4. E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.160</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 the mc:mirlg 30580 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00121-RWR Document 35-1 Filed 04/24113 158 of 235 Penuit "Constellation Reef'S" "l>iblo" the m.a'an]lng VerDate Mar<15>2010 21:24 May 21, 2013 J4:ntire Imloo.rh!r' Interest" Jkt 229001 PO 00000 Frm 00182 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.161</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 H Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00121-RWR Document 35-1 Filed 04/24113 "Final Statemenf- 30581 159 of 235 in Section "Final Distribution Anlounl" in Set'tion in Sedion 5.10. ""j."anrj.,, .. Section s.m, COimnitml'nt" "GM Transsdhm" ill "GM Transsctioo GM Section 3.1, "Governmental Allltllj}l11~· conntry. forth in the Recitals Sectioo 9.8. in Section 12.3_ " Indemnified Sectioo 12.3. VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00183 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.162</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 Section 5.10" 30582 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00121-RWR Document 35-1 Filed 04/24113 160 of 235 "LLC "LLC Interests" "MaIT"d!l Modelo" means Man.:a<; variable ,V1\JU."", S.A. de sociedad allbllima de under dIe "Members" has the "'''''''''''''10 June 28. 2012. VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 Section 6.1. PO 00000 Frm 00184 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.163</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 "Model a Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00185 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 161 of 235 22MYN2 EN22MY13.164</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 Case 1:13-cv-00121-RWR Document 35-1 Filed 04/24113 30583 30584 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00121-RWR Document 35-1 Filed 04/24113 "Purchase p.ice" 162 of 235 Section "Remedial Action" "Restl'ictivc Ternls" and thu mlus and "Seller" has "SeDer Seller and VIUU4jilV. and "Seller Parties" IRuans AU"""",,",,, Sub-licullse VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00186 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM "to 22MYN2 EN22MY13.165</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 de Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00121-RWR Document 35-1 Filed 04/24113 30585 163 of 235 Schedule 13.1. "Ternlination Fee" "Third forth in Sedion 12.3. "T ransition Sen'ices and between ABI and to he ex.!cutea at 1.2 VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00187 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.166</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 neneml Rnle.'! of Constmdion. In 30586 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00121-RWR Document 35-1 Filed 04/24113 164 of 235 t~nn; the eOlrre!'I'lOlldllllg effect other document lhe amlClllDellltS thereto and instruments VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00188 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.167</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 ARTICU:2 PURCIL\SE AND SALE OF TilE CROWN INTEREST Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00121-RWR Document 35-1 Filed 04/24113 30587 165 of 235 2.2 amount in VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00189 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.168</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 2.3 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices TKELLEY on DSK3SPTVN1PROD with NOTICES2 Case 1:13-cv-00127-RWR Document 35-1 Filed 04/24/13 VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00190 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 166 of 235 22MYN2 EN22MY13.169</GPH> 30588 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00121-RWR Document 35-1 Filed 04/24113 30589 161 of 235 ARTICLE 3 TUECLOSING VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00191 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.170</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 the 30590 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00121-RWR Document 35-1 Filed 04/24113 168 of 235 3.3 rhe the n"",,,,,ml to Sel:tioll VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00192 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.171</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 their signatures: Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00121-RWR Document 35-1 Filed 04/24113 30591 169 of 235 ARTICLE 4 RI~PR.:!'n:NT AnONS AND WARRANTn:S Ol~ ABI the VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00193 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.172</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 transactions. 30592 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00121-RWR Document 35-1 Filed 04/24113 170 of 235 VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00194 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.173</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 ofthl'l Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00121-RWR Document 35-1 Filed 04/24113 30593 171 of 235 VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00195 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.174</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 AIUlll,l'; RI<;PIU':Sf:NTATIONS ANI) WARRANTII':S Of' StiVERS ANI) em Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices TKELLEY on DSK3SPTVN1PROD with NOTICES2 Case 1:13-cv-00121-RWR Document 35-1 Filed 04/24113 VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00196 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 172 of 235 22MYN2 EN22MY13.175</GPH> 30594 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00197 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 173 of 235 22MYN2 EN22MY13.176</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 Case 1:13-cv-00121-RWR Document 35-1 Filed 04/24113 30595 30596 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00121-RWR Document 35-1 Filed 04/24113 174 of 235 VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00198 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.177</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 ARTICLE 6 ABI m';ARANn~.: Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00199 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 175 of 235 22MYN2 EN22MY13.178</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 Case 1:13-cv-00121-RWR Document 35-1 Filed 04/24113 30597 30598 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00121-RWR Document 35-1 Filed 04/24113 176 of 235 VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00200 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.179</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 ARTICLE 7 CHI GeARANTEE Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00201 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 171 of 235 22MYN2 EN22MY13.180</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 Case 1:13-cv-00121-RWR Document 35-1 Filed 04/24113 30599 30600 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00121-RWR Document 35-1 Filed 04/24113 178 of 235 ARTICLES COVENANTS OF SELLER PARTIES hereof ARTICI.JE9 OTIIER COVENANTS OF TIlE PARTIES VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00202 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.181</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 to Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00203 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 179 of 235 22MYN2 EN22MY13.182</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 Case 1:13-cv-00121-RWR Document 35-1 Filed 04/24113 30601 30602 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00121-RWR Document 35-1 Filed 04/24113 180 of 235 VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00204 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.183</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 request. Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00121-RWR Document 35-1 Filed 04/24113 30603 181 of 235 9.5 9.6 incurr!c'11Ce In 9.7 VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00205 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.184</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 the Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices TKELLEY on DSK3SPTVN1PROD with NOTICES2 Case 1:13-cv-00121-RWR Document 35-1 Filed 04/24113 VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00206 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 182 of 235 22MYN2 EN22MY13.185</GPH> 30604 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00121-RWR Document 35-1 Filed 04/24113 30605 183 of 235 VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00207 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.186</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 9.9 30606 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00121-RWR Document 35-1 Filed 04/24113 184 of 235 ARTICLE to CONDITIONS TO CLOSING VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00208 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM the 22MYN2 EN22MY13.187</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 Am Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00121-RWR Document 35-1 Filed 04/24113 ARTlCL~: 30607 185 of 235 11 TI':RMINATION 11.1 SedlaR11.2 11.1, ~~~~~~:: to except that: VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00209 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.188</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 fraud of such party, 30608 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00121-RWR Document 35-1 Filed 04/24113 186 of 235 ARTICLE 12 INDEMN I FICA TlON 12.1 VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00210 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.189</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 12.2 Article 12: Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00121-RWR Document 35-1 Filed 04/24113 30609 181 of 235 VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00211 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.190</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 u.§ Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices TKELLEY on DSK3SPTVN1PROD with NOTICES2 Case 1:13-cv-00121-RWR Document 35-1 Filed 04/24113 VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00212 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 188 of 235 22MYN2 EN22MY13.191</GPH> 30610 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00121-RWR Document 35-1 Filed 04/24113 30611 189 of 235 VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00213 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.192</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 12.6 30612 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00121-RWR Document 35-1 Filed 04/24113 190 of 235 detel1nined VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00214 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.193</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 ARTICLE!: ]J TERi'UNATION OF JOINT VENTURE AG REEMENTS Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00121-RWR Document 35-1 Filed 04/24113 30613 191 of 235 ARTI('U: 14 (;I<:NI<:RAI, PROVISIONS 14.2 remedies and VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00215 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.194</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 If to 30614 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00121-RWR Document 35-1 Filed 04/24113 with 192 of 235 shall If to VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00216 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.195</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 shall not constitute notice 0"""",,11,1',.. to: Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00217 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 193 of 235 22MYN2 EN22MY13.196</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 Case 1:13-cv-00121-RWR Document 35-1 Filed 04/24113 30615 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00121-RWR Document 35-1 Filed 04/24113 TKELLEY on DSK3SPTVN1PROD with NOTICES2 ill VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 194 of 235 the Frm 00218 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.197</GPH> 30616 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00121-RWR Document 35-1 Filed 04/24113 30617 195 of 235 VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00219 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.198</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 EACll PARTY ACKNOWLEDGES AND AGREES TIIAT ANY C'ONTROVERSY Willen MAY ARISi'~ UNDER nns A(;RJ'~K!\mNT IS LIKi':LY TO INVOLVE COMPLICATED AND DIFFICULT ISSlTES, AND THEREFORE EACH SllCH PARTY IU:Ri':IJ\' IRRKVOC\B.,Y AN» UNCONDITIONALLY WAln:s ANY RI(;IIT SlJCII PARTY MAY HAn: TO A 'I'RIAL BY .JURY IN R.:SPi':er ()It' ANY UTIGATION DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELA TIN(; TO TIllS AGRI':i':l\U:NT, OR TH.: TRANSAerIONS CONTEMPLATED BY TillS AGREEMENT, INCLllDING ANY SllCH CLAI1\1 AGAINST TIlE FINANCING SOl)RCI~S UNDER TIm F'INANeING COMMIT1\n~NT. KU.'II PARTY CF:RTlFIES ANI) ACKNO\\LF:I)(;I':S THAT NO M;t<:NT OR ATrORNEY OF ANY OTIIER PARTY liAS RI~PRESENTlm, I~XPR}t:SSLY OR OTlII~RWISE, THAT SllCII onn:R PARTY WOVU) NOT, IN nn: EVF:NT OF Ll'rWiHION, SEI~K TO 1':Nlt'ORCI~ '1'111<: l"OlU:GOIN(' WAIV.:R, .:ACII PART\' 1INm:RsTANI)S ANI) EACH I'ARTY liAS CONSIJ)ERI':D '1'1": IMPLICATIONS ()It' TIllS WAIV.:R, .:ACII PARTY liAS In:.:N MAK.:S TillS WAIVI~R VOLlINTARILY ANI) INDUCED TO ENTER INTO TIllS AGREEMENT B'f, AMONG OTHER TlnNGS, TIlE MlnTAL \VAIVERS AND CERTIFICATIONS IN nns SEC'TION 14.12. Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices TKELLEY on DSK3SPTVN1PROD with NOTICES2 Case 1:13-cv-00121-RWR Document 35-1 Filed 04/24113 VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00220 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 196 of 235 22MYN2 EN22MY13.199</GPH> 30618 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00221 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 191 of 235 22MYN2 EN22MY13.200</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 Case 1:13-cv-00121-RWR Document 35-1 Filed 04/24113 30619 30620 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00127-RWR Document 35-1 Filed 04/24/13 CONsn~LLATION IJEI:':HS 198 of 235 I:rn, GRANOS IU~ACJl HOLDINGS, INC. CONSTELLATION ImAN()S, INC () VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00222 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.201</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 ANHEUSER-BUSCII INBEV SA/NY Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00127-RWR Document 35-1 Filed 04/24/13 30621 199 of 235 CONSTlU,LATION 1U':lmS LTD. CONSTELLATION HRANDS, INC. VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00223 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.202</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 ANIlEUSEIl-BUSCIiINKEV SA/NV 30622 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00127-RWR Document 35-1 Filed 04/24/13 IN WITNESS WEIEREOF, an instrument under 200 of 235 caused eXC1~uted, CONSTELLAnON BEERS LTn. Name: Title: CONSTELLATION BRANDS BEACH nU'LIJ'LI'I'Ui:!!, INC. CONSTELLAnON BRANDS, INC. Name: Title: VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00224 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.203</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 ANHEUSER-BUSCH INBEV SA/NY Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00121-RWR Document 35-1 Filed 04/24113 30623 201 of 235 EXHIBIT B TO EXEClJTION COPY OF AMENDED AND RESTATED MEl\IBERSHIP INTEREST P1JRCIL~SE AGREEMENT ASSI(;NMENT OF MEM8I~RSmp INTEREST IN CROWN IMPORTS LLC TillS ASSIGNl\U:NT OF MEMBERSHIP INTEREST _~........_ ... 201 VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00225 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.204</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 VaTlI<LDle consideration the 30624 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00121-RWR Document 35-1 Filed 04/24113 202 of 235 behalf offhe ASSIGNOR: GMODELO CORPORA TION ASSIGNEE: Title: VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00226 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.205</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 -2- Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00121-RWR Document 35-1 Filed 04/24113 30625 203 of 235 Schedule 13.1 Terminated 4. and 6. and between Aglreerm:rlt dated and I'lellwi:ell VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00227 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.206</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 LLe. 30626 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00121-RWR Document 35-1 Filed 04/24113 204 of 235 ,nR~n AMENDMENT TO AMENDlm AND RESTAnm MEMBERSIIIP INTEREST PURCIL\SE AGREEMENT THIS .'IRST Al\U;NI)!\U:NT TO A~U;Nm;J) AN)) RESTATIW MJ;;l\UlERSIUI> INTI<:REST 1)11 RCHASI': AGREEMENT that compllny VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00228 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.207</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 to amend Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00121-RWR Document 35-1 Filed 04/24113 of the deleted 30627 205 of 235 re[!!!I,:ea with the 3. Exhibit attached Exhibit Ae;reejl1lelllt shall VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00229 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.208</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 remam uncluIDflied 30628 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00121-RWR Document 35-1 Filed 04/24113 206 of 235 -3- VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00230 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.209</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 EACH PARTY ACKNO\\'LEDGES AND AGREES TIL\. T ANY CONTROVERSY \\!IIICII MA Y ARnm I!Nm:R TillS A!\II'~NI)!\U:NT IS UKELY TO INVOINE COMPLICATED AND DIFFICULT ISSUES, AND THEREFORE EACII SITCH PARTY IU:RI':IJY IRRI':nX:ABI,Y ANI) 11NCONmTlONALLY \\'AIYES ANY RJ(arr SI'ClI PARTY ~IAY IIA H: TO A TRIAL BY ,)llRY IN RI':SPI':CT OF ANY UTiGATlON mRI<:C'fI,Y OR INmRt:Cn,y ARISINC:~ OFf 01" OR RI<:LATlN(; TO TIns AMENDl\U:NT. OR TilE TRANSACTIONS CONTEl\IPLATED BY TillS AMENDMENT. K~cn PARTY CERTIFIES AND ACKNOWJ,EDC;ES TIJA T NO REPRESENTA'fiVE. AGENT OR ATTORNEY OF ANY OTlIER PART\:' lIAS RI~PRESI':NTEn, EXPRESSI~Y OR OTIlERWISI<:, TIIAT SIJCII OTIII<~R PARTY WOlJU) NOT, IN 'rill<: t:VI<:NT 01" LITIGATION, SEt:K TO ENFORCE THE FORI':(;(JlNG t:ACH PARTY UNDERSTANDS ANI) HAS CONSIJ)ERI<:n THE IMPLICATIONS OF TillS WAIVER, EACH PARTY l\L~KES THIS WAIVER VOLUNTARILY AND EACH PARTY IL\S BEEN INDUCED TO ENTER INTO TillS AMENDMENT BY,AMONG OTHER THINGS, THE MtTTUAL WAIVERS AND C'ERTIFICATIONS IN TillS PARAGR.\PII 4. Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00121-RWR Document 35-1 Filed 04/24113 30629 201 of 235 this Amendment lu an mslrurrlcnt CONSTELLATION CONSTELLATION RRANI>S REACH HOLDINGS, INC CONSTELLATION BRANDS, INC. VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00231 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.210</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 ANHEUSER-BUSCH INBEV SA/NY 30630 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case Document 35-1 Filed 04/24/13 208 of 235 Am,endimclilt to BEERS LTD. BRAt''DS BEACH INC. VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00232 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.211</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 Title: Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00121-RWR Document 35-1 Filed 04/24113 30631 209 of 235 EXHIBIT A VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00233 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.212</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 FORM OF INTERIM SI'PPLY AGREEMENT 30632 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00121-RWR Document 35-1 Filed 04/24113 210 of 235 EXHIBIT A TO FIRST AMENDMENT TO AMENDED AND RESTATED ~U:l\lInmSIIIP INTERI~ST PURCHASE AGRI~I~l\U:NT GRtrPO MODELO, S.A.B. DE c.v. and CROWN IMPORTS LLC VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00234 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.213</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 Dated: _ _ _ _, 2613 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00121-RWR Document 35-1 Filed 04/24113 30633 211 of 235 the Products ARTlCU~ I DEI"INITlONS 1.1 "Affiliate" of any Person means any other Person which_ controlled that "ABI" In the VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00235 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM in 22MYN2 EN22MY13.214</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 lenn Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices TKELLEY on DSK3SPTVN1PROD with NOTICES2 Case 1:13-cv-00121-RWR Document 35-1 Filed 04/24113 VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00236 Fmt 4701 Sfmt 4725 212 of 235 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.215</GPH> 30634 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00121-RWR Document 35-1 Filed 04/24113 30635 213 of 235 "CoosteUation ,. thereto, <'cpr "CPI Adjnshllellt" the the Seetion 1.1 m""nilntT ,,,,.,iPT.ed 110',,1'1"111'\,,11 the Sub· in Exhibit B the of the HI'~dended ",.,,7&.,,1';'" in Smion VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00237 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.216</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 "!':xtension Period" 30636 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00121-RWR Document 35-1 Filed 04/24113 214 of 235 COI"nmclu:ing Oil the 5:0(:leC1JUl ananima "herein" the Product,> and SOIJlli)ljad ananima VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00238 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.217</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 4 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00121-RWR Document 35-1 Filed 04/24113 "New I'H1I;:1('1I1 dated amended, 30637 215 of 235 added Quarler- controlled i"".III~LL"'~ "PriCE:''' has all Products n:CIUll":U VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00239 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.218</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 tenn in Section 6.1~ 30638 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00121-RWR Document 35-1 Filed 04/24113 "saleable" has the .ylt"lmino asSI1!,l11Ca to lcnn in Section the me.mlrlg ru;slglled "T'l'f"lMf"n'" ha'l the UH;,aUU1l> 216 of 235 the Preamble. in Section 1.1 a8S1gl'lea the me;m1l11g ru.slg)!led to the ill Section 1.1 "unsaleable" VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00240 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.219</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 L2 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00121-RWR Document 35-1 Filed 04/24113 not ""tT.ri'«IV 30639 211 of 235 defined herein have ill States ARTICLE II SUPPLY OF PRODUCT LINE VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00241 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.220</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 in Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices TKELLEY on DSK3SPTVN1PROD with NOTICES2 Case 1:13-cv-00121-RWR Document 35-1 Filed 04/24113 VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00242 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 218 of 235 22MYN2 EN22MY13.221</GPH> 30640 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00121-RWR Document 35-1 Filed 04/24113 Mmi~lo 30641 219 of 235 to th~ and VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00243 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.222</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 the volume or 30642 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00121-RWR Document 35-1 Filed 04/24113 220 of 235 VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00244 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.223</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 form"'T Containers. Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00121-RWR Document 35-1 Filed 04/24113 30643 221 of 235 AR:f1Cu:m PRIC(N(; AND PA Yl\U;NT PROCJmURJ~S VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00245 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.224</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 II 30644 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00121-RWR Document 35-1 Filed 04/24113 222 of 235 ARTICLE 1\PROntleT QtlAUTY 4. !nllow"", nnlVi~,iOl!;,;;,;han Product Production: Produd VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00246 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.225</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 shall 30645 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00121-RWR Document 35-1 Filed 04/24113 223 of 235 or eXIXlnlil."S incurred to ,\RTlCLl~ V REI'ORTS VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00247 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.226</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 13 30646 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00121-RWR Document 35-1 Filed 04/24113 224 of 235 such time, VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00248 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.227</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 14 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00121-RWR Document 35-1 Filed 04/24113 of and 30647 225 of 235 """"'''''''' hereunder, shall include with lhli: dale hereof. ARTICLE VI WITH LA \VS VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00249 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.228</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 C()MPUANCI~ 30648 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00121-RWR Document 35-1 Filed 04/24113 226 of 235 VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00250 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.229</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 ARncu: VII INm:MNUICATION ANI) INSIJRANCE Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00121-RWR Document 35-1 Filed 04/24113 30649 221 of 235 VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00251 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.230</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 ARTIeLl': VIII TlmM; TERMIN'A"flON 30650 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00121-RWR Document 35-1 Filed 04/24113 228 of 235 ARTICLE IX LAW GOV.~RNING ARTICLE X MISCEI,LANIl:OlTS VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00252 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.231</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 18 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00121-RWR Document 35-1 Filed 04/24113 30651 229 of 235 VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00253 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.232</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 Iflo Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices TKELLEY on DSK3SPTVN1PROD with NOTICES2 Case 1:13-cv-00121-RWR Document 35-1 Filed 04/24113 VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00254 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 230 of 235 22MYN2 EN22MY13.233</GPH> 30652 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices 231 of 235 TKELLEY on DSK3SPTVN1PROD with NOTICES2 und.."r or with VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00255 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM to this 22MYN2 EN22MY13.234</GPH> Case 1:13-cv-00121-RWR Document 35-1 Filed 04/24113 30653 30654 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00121-RWR Document 35-1 Filed 04/24113 232 of 235 IN \'lITNESS WIIEREOF_ first written (;RUPO MODELO, S.A.B. DE CS. CROWN IMPORTS I~LC Title: Title: VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00256 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.235</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 to Interim Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00121-RWR Document 35-1 Filed 04/24113 30655 233 of 235 EXHIBIT A VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 tbe lImleflllglled bas execul.3d this Frm 00257 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.236</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 WITNESS 30656 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00121-RWR Document 35-1 Filed 04/24113 234 of 235 KXIUBlT B VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00258 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.237</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 B-1 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Case 1:13-cv-00121-RWR Document 35-1 Filed 04/24113 30657 235 of 235 EXHIBIT B-1 H)RI':I(iN .'RI':nmT AI>.ItIST1\fl':NT VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00259 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.238</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 B-1 30658 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices EXHIBITB VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00260 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.239</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 Aeromodelo, S.A. de C.Y. Bodegas Alprosa, S.A. de C.Y. Club de Base Ball Obregon, S.A. de C.Y. Comercio y Distribuci6n Modelo, S. de RL. en C.Y. Compania Cervecera de Colima, S. A. de C.Y. Desarrollo Inmobiliario Siglo XXI, S.A.de C.Y. Espectaculos Costa del Pacifico, S.A. de C.Y. Extrade, S.A. de C.Y. Extraser,S.A. de C.Y. Industria del Campo, S.A. de C.Y. Inmobiliaria Exmod, S.A. de C.Y. Intregrow Malt, LLC Promotora Deportiva y Cultural de la Laguna, S.A. de C.Y. Promotora Deportiva y Cultural de Zacatecas, S.A. de C.Y. Promotora e Inmobiliaria Cuyd, S.A. de C.Y. Rancho Cermo, S.A de C.Y. Santos Laguna, S.A. de C.Y. Seguridad Privada Modelo, S. A. de C. Y. Servicios de Personal Modelo, S.A. de C.Y. Territorio Santos Modelo, S.A. de C.Y. Tiendas Extra, S.A. de C.Y. 30659 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices 17,2013 Dear request of the Antitrust Division of the United States S.A.B. de in connection represents as follows: )en,aI11melnt of IVl\JUI:'lU, " " VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00261 Fmt 4701 Sfmt 4725 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.240</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 in the proipo:,ett is LLC. This r"''''t'P<!pnt"ti"n shall have been tenninated pursuant to Section IlX.I. of the prc,po:sea 30660 Federal Register / Vol. 78, No. 99 / Wednesday, May 22, 2013 / Notices Exhibit D [REDACTED] BILLING CODE 4410–11–P VerDate Mar<15>2010 21:24 May 21, 2013 Jkt 229001 PO 00000 Frm 00262 Fmt 4701 Sfmt 9990 E:\FR\FM\22MYN2.SGM 22MYN2 EN22MY13.241</GPH> TKELLEY on DSK3SPTVN1PROD with NOTICES2 [FR Doc. 2013–11832 Filed 5–21–13; 8:45 am]

Agencies

[Federal Register Volume 78, Number 99 (Wednesday, May 22, 2013)]
[Notices]
[Pages 30399-30660]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2013-11832]



[[Page 30399]]

Vol. 78

Wednesday,

No. 99

May 22, 2013

Part II





Department of Justice





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Antitrust Division





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United States v. Anheuser-Busch InBev SA/NV, Grupo Modelo S.A.B de 
C.V.; Proposed Final Judgment and Competitive Impact Statement; Notice

Federal Register / Vol. 78 , No. 99 / Wednesday, May 22, 2013 / 
Notices

[[Page 30400]]


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DEPARTMENT OF JUSTICE

Antitrust Division


United States v. Anheuser-Busch InBev SA/NV, Grupo Modelo S.A.B 
de C.V.; Proposed Final Judgment and Competitive Impact Statement

    Notice is hereby given pursuant to the Antitrust Procedures and 
Penalties Act, 15 U.S.C. 16(b)-(h), that a proposed Final Judgment, 
Stipulation and Competitive Impact Statement have been filed with the 
United States District Court for the District of Columbia in United 
States of America v. Anheuser-Busch InBev SA/NV, et al., Civil Action 
No. 1:13-CV-00127. On January 31, 2013, the United States filed a 
Complaint alleging that the proposed acquisition by Anheuser-Busch 
InBev SA/NV (``ABI'') of the remaining interest in Grupo Modelo S.A.B. 
de C.V. (``Modelo'') would violate Section 7 of the Clayton Act, 15 
U.S.C. 18. The proposed Final Judgment, filed on April 19, 2013, 
requires ABI and Modelo to divest Modelo's entire U.S. business to 
Constellation Brands, Inc. (``Constellation''), or if that transaction 
fails to consummate, to an alternative purchaser.
    Copies of the Complaint, proposed Final Judgment and Competitive 
Impact Statement are available for inspection at the Department of 
Justice, Antitrust Division, Antitrust Documents Group, 450 Fifth 
Street NW., Suite 1010, Washington, DC 20530 (telephone: 202-514-2481), 
on the Department of Justice's Web site at http://www.justice.gov/atr, 
and at the Office of the Clerk of the United States District Court for 
the District of Columbia. Copies of these materials may be obtained 
from the Antitrust Division upon request and payment of the copying fee 
set by Department of Justice regulations.
    Public comment is invited within 60 days of the date of this 
notice. Such comments, including the name of the submitter, and 
responses thereto, will be posted on the U.S. Department of Justice, 
Antitrust Division's internet Web site, filed with the Court and, under 
certain circumstances, published in the Federal Register. Comments 
should be directed to James Tierney, Chief, Networks and Technology 
Enforcement Section, Antitrust Division, Department of Justice, 450 
Fifth Street NW., Suite 7700, Washington, DC 20530, (telephone: 202-
307-6200).

Patricia A. Brink,
Director of Civil Enforcement.

United States District Court For the District of Columbia

UNITED STATES OF AMERICA, U.S. Department of Justice, Antitrust 
Division, 450 Fifth Street NW., Suite 7100, Washington, DC 20530, 
Plaintiff, v. ANHEUSER-BUSCH InBEV SA/NV, Brouwerijplein 1, Leuven, 
Belgium 3000, and GRUPO MODELO S.A.B de C.V, Javier Barros Sierra No. 
555 Piso 3, Col. Zedec, Santa Fe, Mexico D.F., C.P. 01210, Defendants.

Civil Action No. 13-127 (RWR)

Judge Richard W. Roberts

Complaint

    The United States of America, acting under the direction of the 
Attorney General of the United States, brings this civil action under 
the antitrust laws of the United States to enjoin the proposed 
acquisition by Anheuser-Busch InBev SA/NV (``ABI'') of the remainder of 
Grupo Modelo S.A.B. de C.V. (``Modelo'') that it does not already own, 
and to obtain equitable and other relief as appropriate. The United 
States alleges as follows:

I. Introduction

    1. Fundamental to free markets is the notion that competition works 
best and consumers benefit most when independent firms battle hard to 
win business from each other. In industries characterized by a small 
number of substantial competitors and high barriers to entry, further 
consolidation is especially problematic and antithetical to the 
nation's antitrust laws. The U.S. beer industry--which serves tens of 
millions of consumers at all levels of income--is highly concentrated 
with just two firms accounting for approximately 65% of all sales 
nationwide. The transaction that is the subject of this Complaint 
threatens competition by combining the largest and third-largest 
brewers of beer sold in the United States. The United States therefore 
seeks to enjoin this acquisition and prevent a serious violation of 
Section 7 of the Clayton Act.
    2. Today, Modelo aggressively competes head-to-head with ABI in the 
United States. That competition has resulted in lower prices and 
product innovations that have benefited consumers across the country. 
The proposed acquisition would eliminate this competition by further 
concentrating the beer industry, enhancing ABI's market power, and 
facilitating coordinated pricing between ABI and the next largest 
brewer, MillerCoors, LLC. The approximate market shares of U.S. beer 
sales, by dollars, are illustrated below:
[GRAPHIC] [TIFF OMITTED] TN22MY13.000


[[Page 30401]]


    3. Defendants' combined national share actually understates the 
effect that eliminating Modelo would have on competition in the beer 
industry, both because Modelo's share is substantially higher in many 
local areas than its national share, and because of the interdependent 
pricing dynamic that already exists between the largest brewers. As the 
two largest brewers, ABI and MillerCoors often find it more profitable 
to follow each other's prices than to compete aggressively for market 
share by cutting price. Among other things, ABI typically initiates 
annual price increases in various markets with the expectation that 
MillerCoors' prices will follow. And they frequently do.
    4. In contrast, Modelo has resisted ABI-led price hikes. Modelo's 
pricing strategy--``The Momentum Plan''--seeks to narrow the ``price 
gap'' between Modelo beers and lower-priced premium domestic brands, 
such as Bud and Bud Light. ABI internal documents acknowledge that 
Modelo has put ``increasing pressure'' on ABI by pursuing a competitive 
strategy directly at odds with ABI's well-established practice of 
leading prices upward.
    5. Because Modelo prices have not closely followed ABI's price 
increases, ABI and MillerCoors have been forced to offer lower prices 
and discounts for their brands to discourage consumers from ``trad[ing] 
up'' to Modelo brands. If ABI were to acquire the remainder of Modelo, 
this competitive constraint on ABI's and MillerCoors' ability to raise 
their prices would be eliminated.
    6. The acquisition would also eliminate the substantial head-to-
head competition that currently exists between ABI and Modelo. The loss 
of this head-to-head competition would enhance the ability of ABI to 
unilaterally raise the prices of the brands that it would own post-
acquisition, and diminish ABI's incentive to innovate with respect to 
new brands, products, and packaging.
    7. Accordingly, ABI's acquisition of the remainder of Modelo would 
likely substantially lessen competition and is therefore illegal under 
Section 7 of the Clayton Act, 15 U.S.C. 18.
    8. For no substantial business reason other than to avoid liability 
under the antitrust laws, ABI has entered into an additional 
transaction contingent on the approval of its acquisition of the 
remainder of Modelo. Specifically, ABI has agreed to sell Modelo's 
existing 50% interest in Crown Imports LLC (``Crown'') \1\--which 
currently imports Modelo beer into the United States--to Crown's other 
owner, Constellation Brands, Inc. (``Constellation''). ABI and 
Constellation have also negotiated a proposed Amended and Restated 
Importer Agreement (the ``supply agreement''), giving Constellation the 
exclusive right to import Modelo beer into the United States for ten 
years. Constellation, however, would acquire no Modelo brands or 
brewing facilities under this arrangement--it remains simply an 
importer, required to depend on ABI for its supply of Modelo-branded 
beer. At the end of the ten-year period, ABI could unilaterally 
terminate its agreement with Constellation, thereby giving ABI full 
control of all aspects of the importation, sale, and distribution of 
Modelo brands in the United States.
---------------------------------------------------------------------------

    \1\ Headquartered in Chicago, Illinois, Crown is a 50/50 joint 
venture between Modelo and Constellation. Crown sells and markets 
Modelo's beers in the United States as the exclusive importer of 
Modelo beers.
---------------------------------------------------------------------------

    9. The sale of Modelo's 50% interest in Crown to Constellation is 
designed predominantly to help ABI win antitrust approval for its 
acquisition of Modelo, creating a fa[ccedil]ade of competition between 
ABI and its importer. In reality, Defendants' proposed ``remedy'' 
eliminates from the market Modelo--a particularly aggressive 
competitor--and replaces it with an entity wholly dependent on ABI. As 
Crown's CEO wrote to his employees after the acquisition was announced: 
``Our 1 competitor will now be our supplier . . . it is not 
currently or will not, going forward, be `business as usual.' '' The 
deficiencies of the ``remedy'' are apparent from the illustrations of 
the pre- and post-transaction chains of supply below, demonstrating how 
the ``remedy'' transforms horizontal competition into vertical 
dependency:
[GRAPHIC] [TIFF OMITTED] TN22MY13.001


[[Page 30402]]


    10. Constellation has already shown through its participation in 
the Crown joint venture that it does not share Modelo's incentive to 
thwart ABI's price leadership. In fact, Constellation consistently has 
urged following ABI's price leadership. Given that Constellation was 
inclined to follow ABI's price leadership before the acquisition, it is 
unlikely to reverse course after--when it would be fully dependent on 
ABI for its supply of beer, and will effectively be ABI's business 
partner. In addition, Constellation would need to preserve a strong 
relationship with ABI to encourage ABI from exercising its option to 
terminate the agreement after 10 years.
    11. For these reasons, as alleged more specifically below, the 
proposed acquisition, if consummated, would likely substantially lessen 
competition in violation of Section 7 of the Clayton Act. The likely 
anticompetitive effects of the proposed acquisition would not be 
prevented or remedied by the sale of Modelo's existing interest in 
Crown to Constellation and the supply agreement between ABI and 
Constellation.

II. Jurisdiction, Venue, and Interstate Commerce

    12. The United States brings this action under Section 15 of the 
Clayton Act, as amended, 15 U.S.C. 25, to prevent and restrain 
Defendants ABI and Modelo from violating Section 7 of the Clayton Act, 
as amended, 15 U.S.C. 18.
    13. This Court has subject matter jurisdiction over this action 
under Section 15 of the Clayton Act, 15 U.S.C. 25, and 28 U.S.C. 1331, 
1337, and 1345.
    14. Venue is proper under Section 12 of the Clayton Act, 15 U.S.C. 
22, and 28 U.S.C. 1391.
    15. Defendants are engaged in, and their activities substantially 
affect, interstate commerce. ABI and Modelo annually brew several 
billion dollars worth of beer, which is then advertised and sold 
throughout the United States.
    16. This Court has personal jurisdiction over each Defendant. 
Modelo has consented to personal jurisdiction in this judicial 
district. ABI is found and transacts business in this District through 
its wholly-owned United States subsidiaries, over which it exercises 
control.

III. The Defendants and the Transactions

    17. ABI is a corporation organized and existing under the laws of 
Belgium, with headquarters in Leuven, Belgium. ABI is the largest 
brewer and marketer of beer sold in the United States. ABI owns and 
operates 125 breweries worldwide, including 12 in the United States. It 
owns more than 200 beer brands, including Bud Light, the number one 
brand in the United States, and other popular brands such as Budweiser, 
Busch, Michelob, Natural Light, Stella Artois, Goose Island, and 
Beck's.
    18. Modelo is a corporation organized and existing under the laws 
of Mexico, with headquarters in Mexico City, Mexico. Modelo is the 
third-largest brewer of beer sold in the United States. Modelo's Corona 
Extra brand is the top-selling import in the United States. Its other 
popular brands sold in the United States include Corona Light, Modelo 
Especial, Negra Modelo, Victoria, and Pacifico.
    19. ABI currently holds a 35.3% direct interest in Modelo, and a 
23.3% direct interest in Modelo's operating subsidiary Diblo, S.A. de 
C.V. ABI's current part-ownership of Modelo gives ABI certain minority 
voting rights and the right to appoint nine members of Modelo's 19-
member Board of Directors. However, as ABI stated in its most recent 
annual report, ABI does ``not have voting or other effective control of 
. . . Grupo Modelo.''
    20. ABI and Modelo executives agree that there is currently 
vigorous competition between the ABI and Modelo brands in the United 
States. Indeed, firewalls are in place to ensure that the ABI members 
of Modelo's Board do not become privy to information about the pricing, 
marketing, or distribution of Modelo brands in the United States.
    21. Modelo executives run its day-to-day business, including 
Modelo's relationship and interaction with its U.S. importer, Crown. 
Modelo owns half of Crown and may exercise an option at the end of 
2013, to acquire in 2016, the half of Crown it does not already own. 
Today, Modelo must approve Crown's general pricing parameters, changes 
in strategic direction, borrowing activities, and capital investment 
above certain thresholds. Modelo also sets the global strategic themes 
for the brands it owns. Essentially, Crown is a group of employees who 
report to Crown's owners: Modelo and Constellation.
    22. The acquisition gives complete control of Modelo to ABI, and 
gives ABI full access to competitively sensitive information about the 
sale of the Modelo brands in the United States--access that ABI does 
not currently enjoy. ABI presently has no day-to-day role in Modelo's 
United States business and is walled off from strategic discussions 
regarding Modelo sales in the United States.
    23. On June 28, 2012, ABI agreed to purchase the remaining equity 
interest from Modelo's owners, thereby obtaining full ownership and 
control of Modelo, for about $20.1 billion.
    24. As noted above, in an effective acknowledgement that the 
acquisition of Modelo raises significant competitive concerns, 
Defendants simultaneously entered into another transaction in an 
attempt to ``remedy'' the competitive harm caused by ABI's acquisition 
of the remainder of Modelo: ABI has agreed to sell Modelo's existing 
50% interest in Crown to Constellation, so that Crown, previously a 
joint-venture between Modelo and Constellation, would become wholly 
owned by Constellation. As part of this strategy, ABI and Constellation 
have negotiated a supply agreement giving Constellation the exclusive 
right to import Modelo beer into the United States for ten years. These 
transactions are contingent on the closing of ABI's acquisition of 
Modelo.

IV. The Relevant Market

A. Description of the Product

    25. ``Beer'' is comprised of a wide variety of brands of alcoholic 
beverages usually made from a malted cereal grain, flavored with hops, 
and brewed via a process of fermentation. Beer is substantially 
differentiated from other alcoholic beverages by taste, quality, 
alcohol content, image, and price.
    26. In addition to brewing, beer producers typically also sell, 
market, and develop multiple brands. Marketing and brand building take 
various forms including sports sponsorships, print advertising, 
national television campaigns, and increasingly, online marketing. For 
example, Modelo has recently invested in ``more national advertising 
[and] more national sports'' in order to ``build the equity of [its] 
brands.''
    27. Most brewers use distributors to merchandise, sell, and deliver 
beer to retailers. Those end accounts are primarily grocery stores, 
large retailers such as Target and Walmart, and convenience stores, 
liquor stores, restaurants, and bars which, in turn, sell beer to the 
consumer. Beer brewed in foreign countries may be sold to an importer, 
which then arranges for distribution to retailers.
    28. ABI groups beer into four segments: Sub-premium, premium, 
premium plus, and high-end. The sub-premium segment, also referred to 
as the value segment, generally consists of lager beers, such as 
Natural and Keystone branded beer, and some ales and malt liquors, 
which are priced lower than premium beers, made from less expensive 
ingredients and are generally perceived as being of lower

[[Page 30403]]

quality than premium beers. The premium segment generally consists of 
medium-priced American lager beers, such as ABI's Budweiser, and the 
Miller and Coors brand families, including the ``light'' varieties. The 
premium plus segment consists largely of American beers that are priced 
somewhat higher than premium beers, made from more expensive 
ingredients and are generally perceived to be of superior quality. 
Examples of beers in the premium plus category include Bud Light Lime, 
Bud Light Platinum, Bud Light Lime-a-Rita and Michelob Ultra.
    29. The high-end category includes craft beers, which are often 
produced in small-scale breweries, and imported beers. High-end beers 
sell at a wide variety of price points, most of which are higher than 
premium and premium plus beers. The high-end segment includes craft 
beers such as Dogfish Head, Flying Dog, and also imported beers, the 
best selling of which is Modelo's Corona. ABI also owns high-end beers 
including Stella Artois and Goose Island. Brewers with a broad 
portfolio of brands, such as ABI, seek to maintain ``price gaps'' 
between each segment. For example, premium beer is priced above sub-
premium beer, but below premium plus beer.
    30. Beers compete with one another across segments. Indeed, ABI and 
Modelo brands are in regular competition with one another. For example, 
Modelo, acting through Crown in the United States, usually selects 
``[d]omestic premium'' beer, namely, ABI's Bud Light, as its benchmark 
for its own brands' pricing.

B. Relevant Product Market

    31. Beer is a relevant product market and line of commerce under 
Section 7 of the Clayton Act. Other alcoholic beverages, such as wine 
and distilled spirits, are not sufficiently substitutable to discipline 
at least a small but significant and nontransitory increase in the 
price of beer, and relatively few consumers would substantially reduce 
their beer purchases in the event of such a price increase. Therefore, 
a hypothetical monopolist producer of beer likely would increase its 
prices by at least a small but significant and non-transitory amount.

C. Relevant Geographic Market

    32. The 26 local markets, defined by Metropolitan Statistical Areas 
(``MSAs''),\2\ identified in Appendix A, are relevant geographic 
markets for antitrust purposes. Each of these local markets currently 
benefits from head-to-head competition between ABI and Modelo, and in 
each the acquisition would likely substantially lessen competition.
---------------------------------------------------------------------------

    \2\ As defined by the SymphonyIRI Group, a market research firm, 
whose data is commonly used by industry participants.
---------------------------------------------------------------------------

    33. The relevant geographic markets for analyzing the effects of 
this acquisition are best defined by the locations of the customers who 
purchase beer, rather than by the locations of breweries. Brewers 
develop pricing and promotional strategies based on an assessment of 
local demand for their beer, local competitive conditions, and local 
brand strength. Thus, the price for a brand of beer can vary by local 
market.
    34. Brewers are able to price differently in different locations, 
in part, because arbitrage across local markets is unlikely to occur. 
Consumers buy beer near their homes and typically do not travel to 
other areas to buy beer when prices rise. Also, distributors' contracts 
with brewers and their importers contain territorial limits and 
prohibit distributors from reselling beer outside their territories. In 
addition, each state has different laws and regulations regarding beer 
distribution and sales that would make arbitrage difficult.
    35. Accordingly, a hypothetical monopolist of beer sold into each 
of the local markets identified in Appendix A would likely increase its 
prices in that local market by at least a small but significant and 
non-transitory amount.
    36. Therefore, the MSAs identified in Appendix A are relevant 
geographic markets and ``sections of the country'' within the meaning 
of Section 7 of the Clayton Act.
    37. There is also competition between brewers on a national level 
that affects local markets throughout the United States. Decisions 
about beer brewing, marketing, and brand building typically take place 
on a national level. In addition, most beer advertising is on national 
television, and brewers commonly compete for national retail accounts. 
General pricing strategy also typically originates at a national level. 
A hypothetical monopolist of beer sold in the United States would 
likely increase its prices by at least a small but significant and non-
transitory amount. Accordingly, the United States is a relevant 
geographic market under Section 7 of the Clayton Act.

V. ABI'S Proposed Acquisition Is Likely To Result in Anticompetitive 
Effects

A. The Relevant Markets are Highly Concentrated and the Merger Triggers 
a Presumption of Illegality in Each Relevant Market

    38. The relevant markets are highly concentrated and would become 
significantly more concentrated as a result of the proposed 
acquisition.
    39. ABI is the largest brewer of beer sold in the United States. 
MillerCoors is the second-largest brewer of beer sold in the United 
States. MillerCoors owns the Miller and Coors brands and also many 
smaller brands including Blue Moon and Keystone Light. Modelo is the 
third-largest brewer of beer sold in the United States, with annual 
U.S. sales of $2.47 billion, 7% market share nationally, and a market 
share that is nearly 20% in some local markets. Modelo owns the Corona, 
Modelo, Pacifico, and Victoria brands. The remaining sales of beer in 
the U.S. are divided among Heineken and fringe competitors, including 
many craft brewers, which the Defendants characterize as being 
``fragmented . . . small player[s].''
    40. Concentration in relevant markets is typically measured by the 
Herfindahl-Hirschman Index (``HHI''). Market concentration is often one 
useful indicator of the level of competitive vigor in a market and the 
likely competitive effects of a merger. The more concentrated a market, 
and the more a transaction would increase concentration in a market, 
the more likely it is that a transaction would result in a meaningful 
reduction in competition. Markets in which the HHI is in excess of 
2,500 points are considered highly concentrated.
    41. The beer industry in the United States is highly concentrated 
and would become substantially more so as a result of this acquisition. 
Market share estimates demonstrate that in 20 of the 26 local 
geographic markets identified in Appendix A, the post-acquisition HHI 
exceeds 2,500 points, in one market is as high as 4,886 points, and 
there is an increase in the HHI \3\ of at least 472 points in each of 
those 20 markets. In six of the local geographic markets, the post-
merger HHI is at least 1,822, with an increase of the HHI of at least 
387 points, and in each of those six markets the parties combined 
market share is greater than 30%.
---------------------------------------------------------------------------

    \3\ Even if these concentration measures are modified to reflect 
ABI's current partial ownership of Modelo, the effective levels of 
concentration would still support a presumption of illegality.
---------------------------------------------------------------------------

    42. In the United States, the Defendants will have a combined

[[Page 30404]]

market share of approximately 46% post-transaction. The post-
transaction HHI of the United States beer market will be greater than 
2800, with an increase in the HHI of 566.
    43. The market concentration measures, coupled with the significant 
increases in concentration, described above, demonstrate that the 
acquisition is presumed to be anticompetitive.

B. Beer Prices in the United States Today are Largely Determined by the 
Strategic Interactions of ABI, MillerCoors, and Modelo

1. ABI's Price Leadership
    44. ABI and MillerCoors typically announce annual price increases 
in late summer for execution in early fall. The increases vary by 
region, but typically cover a broad range of beer brands and packs. In 
most local markets, ABI is the market share leader and issues its price 
announcement first, purposely making its price increases transparent to 
the market so its competitors will get in line. In the past several 
years, MillerCoors has followed ABI's price increases to a significant 
degree.
    45. The specifics of ABI's pricing strategy are governed by its 
``Conduct Plan,'' a strategic plan for pricing in the United States 
that reads like a how-to manual for successful price coordination. The 
goals of the Conduct Plan include: ``yielding the highest level of 
followership in the short-term'' and ``improving competitor conduct 
over the long-term.''
    46. ABI's Conduct Plan emphasizes the importance of being 
``Transparent--so competitors can clearly see the plan;'' ``Simple--so 
competitors can understand the plan;'' ``Consistent--so competitors can 
predict the plan;'' and ``Targeted--consider competition's structure.'' 
By pursuing these goals, ABI seeks to ``dictate consistent and 
transparent competitive response.'' As one ABI executive wrote, a 
``Front Line Driven Plan sends Clear Signal to Competition and Sets up 
well for potential conduct plan response.'' According to ABI, its 
Conduct Plan ``increases the probability of [ABI] sustaining a price 
increase.''
    47. The proposed merger would likely increase the ability of ABI 
and the remaining beer firms to coordinate by eliminating an 
independent Modelo--which has increasingly inhibited ABI's price 
leadership--from the market.
2. Modelo Has Constrained ABI's Ability to Lead Prices Higher
    48. In the past several years, Modelo, acting through Crown, has 
disrupted ABI's pricing strategy by declining to match many of the 
price increases that were led by ABI and frequently joined by 
MillerCoors.
    49. In or around 2008, Crown implemented its ``Momentum Plan'' with 
Modelo's enthusiastic support. The Momentum Plan is specifically 
designed to grow Modelo's market share by shrinking the price gaps 
between brands owned by Modelo and domestic premium brands. By 
maintaining steady pricing while the prices of premium beer continues 
to rise, Modelo has narrowed the price gap between its beers and ABI's 
premium beers, encouraging consumers to trade up to Modelo brands. 
These narrowed price gaps frustrate ABI and MillerCoors because they 
result in Modelo gaining market share at their expense.
    50. Under the Momentum Plan, Modelo brand prices essentially 
remained flat despite price increases from ABI and other competitors, 
allowing Modelo brands to achieve their targeted price gaps to premium 
beers in various markets. After Modelo implemented its price gap 
strategy, Modelo brands experienced market share growth.
    51. Because of the Momentum Plan, prices on the Modelo brands have 
increased more slowly than ABI has increased premium segment prices. 
Thus, as ABI has observed, in recent years, the ``gap between Premium 
and High End has been reducing . . . due to non [high-end] increases.'' 
Over the same time period, the high-end segment has been gaining market 
share at the expense of ABI's and MillerCoors' premium domestic brands.
    52. In internal strategy documents, ABI has repeatedly complained 
about pressure resulting from price competition with the Modelo brands: 
``Recent price actions delivered expected Trade up from Sub Premium, 
however it created additional share pressure from volume shifting to 
High End where we under-index;'' ``Consumers switching to High End 
accelerated by price gap compression;'' ``While relative Price to MC 
[MillerCoors] has remained stable the lack of Price increase in Corona 
is increasing pressure in Premium.'' An ABI presentation from November 
2011 stated that ABI's strategy was ``Short-Term []: We must slow the 
volume trend of High End Segment and cannot let the industry 
transform.'' Owning the Modelo brands will enable ABI to implement that 
strategy.
    53. The competition that Modelo has created by not following ABI 
price increases has constrained ABI's ability to raise prices and 
forced ABI to become more competitive by offering innovative brands and 
packages to limit its share losses and to attract customers.
    54. Competition between the ABI and Modelo brands has become 
increasingly intense throughout the country, particularly in areas with 
large Latino populations. As the country's Latino population is 
forecasted to grow over time, ABI anticipates even more rigorous 
competition with Modelo. Here are some examples of how the Modelo 
brands have disciplined the pricing of the market leaders.
a. California
    55. Modelo, acting through Crown, has not followed ABI-led price 
increases in local markets in California. Because of the aggressive 
pricing of the Modelo brands, ABI's Bud and Bud Light brands have 
reported ``[h]eavy share losses'' to Modelo's Corona and Modelo 
Especial.
    56. Consumers in California markets have been the beneficiaries of 
Modelo's aggressive pricing. ABI rescinded a planned September 2010 
price increase because of the share growth of Modelo's Corona brand. 
ABI also considered launching a new line, ``Michelob Especial,''--a 
Modelo brand is ``Modelo Especial''--targeted at California's Latino 
community. ABI recognized that Corona's strength in California meant 
that ``innovation [is] required.'' Nonetheless, Modelo continued 
``eating [Budweiser's] lunch'' in California to the point where ABI's 
Vice President of Sales observed that ``California is a burning 
platform'' for ABI, which was ``losing share'' because of ``price 
compression'' between ABI and Corona.
    57. In 2012, ABI's concern about losing market share to Modelo in 
California caused a full-blown price war. ABI implemented ``aggressive 
price reductions . . .'' that were seen as ``specifically targeting 
Corona and Modelo.'' These aggressive discounts appear to have been 
taken in support of ABI's expressed desire to discipline Modelo's 
aggressive pricing with the ultimate goal of ``driv[ing] them to go 
up'' in price. Both MillerCoors and Modelo followed ABI's price 
decrease, and ABI responded by dropping its price even further to stay 
competitive.
b. Texas
    58. Competition between the ABI and Modelo brands in local markets 
in Texas is also intense. Beginning in or about 2010, some Modelo 
brands began to be priced competitively with ABI's Bud Light, the 
leading domestic brand throughout the state. Modelo brands also 
benefited from price promotions and regional advertising. By 2011, 
Modelo had begun gaining market share at ABI's expense. ABI recognized

[[Page 30405]]

Modelo's aggressive price strategy as an issue contributing to its 
market share loss.
    59. Ultimately, aggressive pricing on some Modelo brands forced ABI 
to lower its prices in local Texas markets, and adjust its marketing 
strategy to better respond to competition from the Modelo brands. 
According to an ABI Regional Vice President of Sales, ABI set 
``pricing, packaging and retail activity targets to address [Modelo's] 
Especial'' brand. In both Houston and San Antonio, ABI also lowered the 
price of its Bud Light Lime brand to match Modelo Especial price moves.
c. New York City
    60. In the summer of 2011, Modelo, acting through Crown, sought to 
narrow the gap in price between its brands and those of domestic 
premiums, including the ABI brands in New York City. ABI became 
concerned that ``price compression on Premiums by imports'' would cause 
premium domestic customers to trade up to the import segment. ABI's 
Vice President of Sales observed that the price moves on Modelo's 
Corona brand, and corresponding reductions by MillerCoors and Heineken, 
meant that ABI would ``need to respond in some fashion,'' and that its 
planned price increase was ``in jeopardy.'' ABI ultimately chose to 
respond by delaying a planned price increase to ``limit the impact of 
price compression on our premiums as a result of the Corona . . . 
deeper discount.''

C. The Elimination of Modelo Would Likely Result in Higher Coordinated 
Pricing by ABI and MillerCoors

    61. Competition spurred by Modelo has benefitted consumers through 
lower beer prices and increased innovation. It has also thwarted ABI's 
vision of leading industry prices upward with MillerCoors and others 
following. As one ABI executive stated in June 2011, ``[t]he impact of 
Crown Imports not increasing price has a significant influence on our 
volume and share. The case could be made that Crown's lack of increases 
has a bigger influence on our elasticity than MillerCoors does.'' ABI's 
acquisition of full ownership and control of Modelo's brands and 
brewing assets will facilitate future pricing coordination.

D. The Loss of Head-to-Head Competition Between ABI and Modelo Would 
Likely Result in Higher Prices on ABI-Owned Brands

    62. ABI is intent on moderating price competition. As it has 
explained internally: ``We must defend from value-destroying pricing 
by: [1] Ensuring competition does not believe they can take share 
through pricing[,] [and] [2] Building discipline in our teams to 
prevent unintended initiation or acceleration of value-destroying 
actions.'' ABI documents show that it is increasingly worried about the 
threat of high-end brands, such as Modelo's, constraining its ability 
to increase premium and sub-premium pricing. In general, ABI, as the 
price leader, would prefer a market not characterized by aggressive 
pricing actions to take share because ``[t]aking market share this way 
is unsustainable and results in lower total industry profitability 
which damages all players long-term.''
    63. ABI would have strong incentives to raise the prices of its 
beers were it to acquire Modelo. First, lifting the price of Modelo 
beers would allow ABI to further increase the prices of its existing 
brands across all beer segments. Second, as the market leader in the 
premium and premium-plus segments, and as a brewer with an approximate 
overall national share of approximately 46% of beer sales post-
acquisition, coupled with its newly expanded portfolio of brands, ABI 
stands to recapture a significant portion of any sales lost due to such 
a price increase, because a significant percentage of those lost sales 
will go to other ABI-owned brands.
    64. Therefore, ABI likely would unilaterally raise prices on the 
brands of beer that it owns as a result of the acquisition.

E. The Loss of Head-to-Head Competition Between ABI and Modelo Will 
Harm Consumers Through Reduced New Product Innovation and Product 
Variety

    65. Modelo's growth in the United States has repeatedly spurred 
product innovation by ABI. In 2011, ABI decided to ``Target Mexican 
imports'' and began planning three related ways of doing so. First, ABI 
would acquire the U.S. sales rights to Presidente beer, the number one 
beer in Central America, and greatly expand Presidente's distribution 
in the United States. Second, ABI would acquire a ``Southern US or 
Mexican craft brand,'' and use it to compete against Mexican imports. 
Finally, ABI would license trademarks to another tropical-style beer, 
in a project that the responsible ABI manager described as a ``Corona 
killer.''
    66. ABI's Bud Light Lime, launched in 2008, was also targeted at 
Corona (commonly served with a slice of lime), going so far as to mimic 
Corona's distinctive clear bottle. As one Modelo executive noted after 
watching a commercial for Bud Light Lime, the product was ``invading 
aggressively and directly the Corona territory.'' Another executive 
commented that the commercial itself was ``[v]ery similar'' to one 
Modelo, through Crown, was developing at the same time.
    67. The proposed acquisition's harmful effect on product innovation 
is already evident. If ABI were to acquire Modelo and enter into the 
supply agreement with Constellation, ABI would be forbidden from 
launching a ``Mexican-style Beer'' in the United States. Further, ABI 
would no longer have the same incentives to introduce new brands to 
take market share from the Modelo brands.

F. Summary of Competitive Harm From ABI's Acquisition of the Remainder 
of Modelo

    68. The significant increase in market concentration that the 
proposed acquisition would produce in the relevant markets, combined 
with the loss of head-to-head competition between ABI and Modelo, is 
likely to result in unilateral price increases by ABI and to facilitate 
coordinated pricing between ABI and remaining market participants.

VI. Absence of Countervailing Factors

    69. New entry and expansion by existing competitors are unlikely to 
prevent or remedy the acquisition's likely anticompetitive effects. 
Barriers to entry and expansion within each of these harmed markets 
include: (i) The substantial time and expense required to build a brand 
reputation; (ii) the substantial sunk costs for promotional and 
advertising activity needed to secure the distribution and placement of 
a new entrant's beer products in retail outlets; (iii) the difficulty 
of securing shelf-space in retail outlets; (iv) the time and cost of 
building new breweries and other facilities; and (v) the time and cost 
of developing a network of beer distributors and delivery routes.
    70. Although ABI asserts that the acquisition would produce 
efficiencies, it cannot demonstrate acquisition-specific and cognizable 
efficiencies that would be passed-through to U.S. consumers, of 
sufficient size to offset the acquisition's significant anticompetitive 
effects.

VII. Defendants' Proffered ``Remedy'' Does Not Prevent the 
Anticompetitive Effect of ABI's Acquisition of Modelo

    71. In light of the high market concentration, and substantial 
likelihood of anticompetitive effects, ABI's acquisition of the 
remainder of Modelo is illegal. Defendants thus evidently structured 
their transactions

[[Page 30406]]

with a purported ``remedy'' in mind: the sale of Modelo's interest in 
Crown to Constellation, coupled with a supply agreement that gives 
Constellation the right to import Modelo beer into the United States. 
This proposal is inadequate to remedy Defendants' violation of Section 
7 of the Clayton Act.

A. Constellation Has Not Shown Modelo and Crown's Past Willingness To 
Resist ABI's ``Leader-Follower'' Industry Plan

    72. Constellation has not shown Crown and Modelo's past willingness 
to thwart ABI's price leadership. While Modelo supported narrowing the 
gap between the prices of its brands and those of ABI premium brands, 
Constellation's executives have sought to follow ABI's pricing lead. In 
August 2011, Constellation's Managing Director wrote to Crown's CEO: 
``Since ABI has already announced an October general price increase I 
was wondering if you are considering price increases for the Modelo 
portfolio? . . .. From a positioning and image perspective I believe it 
would be a mistake to allow the gaps to be narrowed . . . I think ABI's 
announcement gives you the opportunity to increase profitability 
without having to sacrifice significant volume.'' Similarly, in 
December of 2011, Constellation's CFO wrote to his counterpart at Crown 
that he thought price increases on the Modelo brands were viable ``if 
domestics [i.e. Bud and Bud Light] keep going up'' but worried that 
``Modelo gets a vote as well.'' And in June of 2012, a Crown executive 
stated that Constellation's plan for annual price increases ``put at 
risk the relative success'' of the Momentum Plan.
    73. Crown executives have recognized the differing incentives, as 
it relates to pricing, of their two owners. As one Crown executive 
observed in a March 2011 email, ``Modelo has a higher interest in 
building volume so that they can cover manufacturing costs, gain 
manufacturing profits and build share as the brand owners.'' 
Constellation, however, ``is interested primarily in the financial 
return on a short-term or at the most on a mid-term basis.''
    74. Post-transaction, Constellation would no longer be so 
constrained. Even if Crown's own executives wanted to continue an 
aggressive pricing strategy, they would be required to answer to 
Crown's new sole owner--Constellation.
    75. Crown executives were concerned about what would happen if 
Constellation gained complete control of Crown. Crown's CEO wrote to 
Constellation's CEO after Defendants' proposed ``remedy'' was 
announced: ``the Crown team [] is extremely anxious about this change 
in ownership. This is in no small part the result of Constellation's 
actions over the term of the joint venture to limit investment in the 
business in the areas of manpower and marketing.'' Constellation's CEO 
responded internally: ``[Q]uite something. I see a management issue 
brewing.'' In another email, Crown's CEO wrote to his employees that 
Constellation had been ``consistently non supportive of the business 
through Crown's history . . . seeking to drive profits at all costs.''
    76. Crown's fears appear well-grounded. In 2010, Modelo sued 
Constellation for breach of fiduciary duty, after Constellation had 
refused to invest in marketing the Modelo brands. In its Complaint, 
Modelo alleged ``Constellation [] knew that [Crown] management's plan 
was in Crown's best interests, but they blocked it anyway in an effort 
to secure unwarranted benefits for Constellation.''
    77. Post-acquisition, Constellation would not need to ask Modelo 
for permission to follow ABI's price-leadership. Instead, Constellation 
would be free to follow ABI's lead. Moreover, ABI and Constellation 
will have every incentive to act together on pricing because of the 
vast profits each would stand to make if beer prices were to increase.
    78. The contingent supply relationship between ABI and 
Constellation would also facilitate joint pricing between the two 
companies. Post-acquisition, there would be day-to-day interaction 
between ABI and Constellation on matters such as volume, packaging, 
transportation of product, and new product innovation. ABI and 
Constellation would have countless opportunities that could creatively 
be exploited, and that no one could predict or control, to allow ABI to 
reward Constellation (or refrain from punishing Constellation) in 
exchange for Constellation raising the price of the Modelo brands. The 
lucrative supply agreement from which Constellation seeks to gain 
billions of dollars in profits itself incentivizes Constellation to 
keep ABI happy to avoid terminating Constellation's rights in ten 
years.
    79. ABI and Constellation are more likely to decide on mutually 
profitable pricing. Unlike ABI and Modelo, which are horizontal 
competitors, Constellation would be a mere participant in ABI's supply 
chain under the proposed arrangement.
    80. ABI and Modelo have sought to avoid acting together on matters 
of competitive significance in the relevant markets in the U.S. 
Accordingly, they have built in several firewalls--including ABI's 
exclusion from sensitive portions of Modelo board meetings concerning 
the sale of Modelo beer in the U.S.--to insulate ABI from Modelo's U.S. 
business. Post-acquisition, those firewalls would be gone.
    81. The loss of Modelo also, by itself, facilitates interdependent 
pricing. Today, ABI would need to reach agreement with both Modelo and 
Constellation to ensure that pricing for the Modelo brands followed 
ABI's lead. After the proposed transactions, working together on price 
would be easier because only Constellation would need to follow or 
agree with ABI.

B. Constellation Will Not Be an Independent Firm Capable of Restoring 
Head-To-Head Competition Between ABI and Modelo

    82. Even if Constellation wanted to act at odds with ABI post-
transaction, it would be unlikely to do so. Constellation will own no 
brands or brewing or bottling assets of its own. It would be dependent 
on ABI for its supply. Thus, Defendants' proposed remedy puts 
Constellation in a considerably weaker competitive position compared to 
Modelo, which owns both brands and breweries.
    83. ABI could terminate the contingent supply agreement at any 
time. And if ABI is displeased with Constellation's strategy in the 
United States, it might simply withhold or delay supply to punish 
Constellation.
    84. The supply agreement may also be renegotiated at any time 
during the 10-year period. Thus, it provides no guaranteed protection 
for consumers that any of its terms will be followed if ABI is able to 
secure antitrust approval for this acquisition.

VIII. Violations Alleged

    85. The United States incorporates the allegations of paragraphs 1 
through 84 above as if set forth fully herein.

Violation of Clayton Act Sec.  7, 15 U.S.C. 18

ABI Agreement To Acquire Remainder of Modelo

    86. The proposed acquisition of the remainder of Modelo by ABI 
would likely substantially lessen competition--even after Defendants' 
proposed ``remedy''--in the relevant markets, in violation of Section 7 
of the Clayton Act, 15 U.S.C. 18. The transactions would have the 
following anticompetitive effects, among others:
    (a) Eliminating Modelo as a substantial, independent, and

[[Page 30407]]

competitive force in the relevant markets, creating a combined firm 
with reduced incentives to lower price or increase innovation or 
quality;
    (b) Competition generally in the relevant markets would likely be 
substantially lessened;
    (c) Prices of beer would likely increase to levels above those that 
would prevail absent the transaction, forcing millions of consumers in 
the United States to pay higher prices;
    (d) Quality and innovation would likely be less than levels that 
would prevail absent the transaction;
    (e) The acquisition would likely promote and facilitate pricing 
coordination in the relevant markets; and
    (f) The acquisition would provide ABI with a greater incentive and 
ability to increase its pricing unilaterally.

IX. Request for Relief

    87. The United States requests that:
    (a) The proposed acquisition be adjudged to violate Section 7 of 
the Clayton Act, 15 U.S.C. 18;
    (b) The Defendants be permanently enjoined and restrained from 
carrying out the Agreement and Plan of Merger dated June 28, 2012, and 
the ``Transaction Agreement'' dated June 28, 2012, between Modelo, 
Diblo, and ABI, or from entering into or carrying out any agreement, 
understanding, or plan by which ABI would acquire the remaining 
interest in Modelo, its stock, or any of its assets;
    (c) The United States be awarded costs of this action; and
    (d) The United States be awarded such other relief as the Court may 
deem just and proper.

Dated this 31st day of January 2013.

    Respectfully submitted,

FOR PLAINTIFF UNITED STATES:

/s/--------------------------------------------------------------------

WILLIAM J. BAER (D.C. BAR  324723),

Assistant Attorney General for Antitrust.
/s/--------------------------------------------------------------------

RENATA B. HESSE (D.C. BAR  466107),

Deputy Assistant Attorney General.
/s/--------------------------------------------------------------------

PATRICIA A. BRINK,

Director of Civil Enforcement.
/s/--------------------------------------------------------------------

MARK W. RYAN (D.C. BAR  359098),

Director of Litigation.
/s/--------------------------------------------------------------------

JOSEPH J. MATELIS (D.C. BAR  462199),

Chief Counsel for Innovation.
/s/--------------------------------------------------------------------

JAMES J. TIERNEY (D.C. BAR  434610),

Chief.

N. SCOTT SACKS (D.C. BAR  913087)

Acting Assistant Chief.

NETWORKS & TECHNOLOGY
ENFORCEMENT SECTION

/s/--------------------------------------------------------------------

MICHELLE R. SELTZER* (D.C. BAR  475482),

Attorney.

LITIGATION I

Antitrust Division, U.S. Department of Justice, 450 Fifth Street 
NW., Suite 4100, Washington, DC 20530, Telephone: (202) 353-3865, 
Facsimile: (202) 307-5802, E-mail: michelle.seltzer@usdoj.gov.

SANFORD ADLER
JANET BRODY
TRAVIS R. CHAPMAN
JOHN C. FILIPPINI (DC BAR  165159)
DAVID Z. GRINGER
DANIELLE G. HAUCK
DAVID C. KELLY
ANURAG MAHESHWARY (DC BAR  490535)
LOWELL STERN (DC BAR  440487)
MARY STRIMEL(DC BAR  455303)
RYAN STRUVE (DC BAR  495406)
SHANE WAGMAN

Attorneys for the United States

*Attorney of Record

Appendix A

[[Page 30408]]

[GRAPHIC] [TIFF OMITTED] TN22MY13.002

United States District Court for the District of Columbia

United States of America, Plaintiff, v. Anheuser-Busch InBEV SA/NV, et 
al., Defendants.

Civil Action No. 13-127 (RWR)

Judge Richard W. Roberts

Competitive Impact Statement

    Pursuant to Section 2(b) of the Antitrust Procedures and Penalties 
Act (``APPA'' or ``Tunney Act''), 15 U.S.C. 16(b)-(h), Plaintiff United 
States of America (``United States'') files this Competitive Impact 
Statement relating to the proposed Final Judgment submitted on April 
19, 2013, for entry in this civil antitrust proceeding.

I. Nature and Purpose of the Proceeding

    On June 28, 2012, Defendant Anheuser-Busch InBev SA/NV (``ABI'') 
agreed to purchase the remaining equity interest in Defendant Grupo 
Modelo, S.A.B. de C.V. (``Modelo'') for approximately $20.1 billion. 
The United

[[Page 30409]]

States filed a civil antitrust Complaint against ABI and Modelo on 
January 31, 2013, seeking to enjoin the proposed acquisition. The 
Complaint alleges that the likely effect of this acquisition would be 
to lessen competition substantially for beer in the United States and 
specifically in twenty-six local markets in violation of Section 7 of 
the Clayton Act, 15 U.S.C. 18. This loss of competition would likely 
result in higher beer prices and less innovation.
    On April 19, 2013, the United States filed an Explanation of 
Consent Decree Procedures, which included a Stipulation and Order and a 
proposed Final Judgment as exhibits that are collectively designed to 
eliminate the anticompetitive effects that the acquisition would have 
otherwise caused. The proposed Final Judgment, which is explained more 
fully below, will accomplish the complete divestiture of Modelo's U.S. 
business to Modelo's current joint venture partner, Constellation 
Brands, Inc. (``Constellation''), or, if that transaction fails to 
close, to another acquirer capable of replacing the competition that 
Modelo currently brings to the United States market. This structural 
fix will maintain Modelo Brand Beers \4\ as independent competitors to 
ABI's flagship brands in the United States and will eliminate the 
existing entanglements between ABI and Modelo vis-[agrave]-vis the beer 
market in the United States.
---------------------------------------------------------------------------

    \4\ Capitalized terms in this Competitive Impact Statement are 
defined in the proposed Final Judgment.
---------------------------------------------------------------------------

    Specifically, under the proposed Final Judgment, ABI is required to 
divest and/or license to Constellation (or to an alternative purchaser 
if the sale to Constellation for some reason does not close) certain 
tangible and intangible assets (hereafter the ``Divestiture Assets''), 
including:
     A perpetual and exclusive United States license to Corona 
Extra, this country's best-selling imported beer and 5 brand 
overall, and to nine other Modelo Brand Beers including Corona Light, 
Modelo Especial, Negra Modelo, and Pacifico;
     Modelo's newest, most technologically advanced brewery 
(the ``Piedras Negras Brewery''), which is located in Mexico near the 
Texas border, and the assets and companies associated with it;\5\
---------------------------------------------------------------------------

    \5\ The Piedras Negras Brewery is owned by a subsidiary of 
Modelo--Compa[ntilde]ia Cervecera de Coahuila S.A. de C.V., which 
will be transferred as part of the divestiture.
---------------------------------------------------------------------------

     Modelo's limited liability membership interest in Crown 
Imports, LLC (``Crown''), the joint venture established by Modelo and 
Constellation to import, market, and sell certain Modelo beers into the 
United States; and
     Other assets, rights, and interests necessary to ensure 
that Constellation (or an alternative purchaser) is able to compete in 
the beer market in the United States using the Modelo Brand Beers, 
independent of a relationship with ABI and Modelo.

Under the terms of the Stipulation and Order, Constellation will be 
added as a Defendant for purposes of settlement,\6\ and ABI, Modelo, 
and Constellation will take certain steps to operate Crown, the Piedras 
Negras Brewery, and the other Divestiture Assets as competitively 
independent, economically viable, and ongoing assets whose commercial 
activities will remain uninfluenced by ABI until the sale to 
Constellation has closed.
---------------------------------------------------------------------------

    \6\ As discussed further below and in Section III.B herein, 
Constellation will be joined as a settling Defendant because it will 
be required, as a condition of acquiring the Divestiture Assets, to 
complete an expansion of the Piedras Negras Brewery to serve current 
and future United States demand.
---------------------------------------------------------------------------

    In order to guarantee that the acquirer of the Divestiture Assets 
will be able to supply Modelo Brand Beer to the United States market 
independent of ABI, the proposed Final Judgment contains provisions 
designed to ensure that Constellation (or an alternative acquirer) will 
have sufficient brewing capacity to meet current and future demand for 
Modelo Brand Beer in the United States. Because the Piedras Negras 
Brewery currently produces enough Modelo Brand Beer to serve only 
approximately 60% of present U.S. demand, Constellation has committed 
to build out and expand the Piedras Negras Brewery to brew and package 
sufficient quantities of Corona, Modelo Especial, and other Modelo 
Brand Beer to meet the large and growing demand for these beers in the 
United States. This expansion is included as a direct requirement under 
the proposed Final Judgment and will assure Constellation's future 
independence as a self-supplied brewer and seller in the United States 
beer market.
    The United States and Defendants have stipulated that the proposed 
Final Judgment may be entered after compliance with the APPA. Entry of 
the proposed Final Judgment would terminate this action, except that 
the Court would retain jurisdiction to construe, modify, or enforce the 
provisions of the proposed Final Judgment and to punish violations 
thereof.

II. Description of the Events Giving Rise to the Alleged Violation

A. The Defendants and the Proposed Transaction

    ABI is a corporation organized and existing under the laws of 
Belgium, with headquarters in Leuven, Belgium. ABI brews and markets 
more beer sold in the United States than any other firm, with a 39% 
market share nationally. ABI owns and operates 125 breweries worldwide, 
including 12 in the United States. It owns more than 200 different beer 
brands, including Bud Light, the highest selling brand in the United 
States, and other popular brands such as Budweiser, Busch, Michelob, 
Natural Light, Stella Artois, Goose Island, and Beck's.
    Modelo is a corporation organized and existing under the laws of 
Mexico, with headquarters in Mexico City, Mexico. Modelo is the third-
largest brewer of beer sold in the United States, with a 7% market 
share nationally. Modelo owns the top-selling beer imported into the 
United States, Corona Extra. Its other popular brands sold in the 
United States include Corona Light, Modelo Especial, Negra Modelo, 
Victoria, and Pacifico. Crown, the joint venture established by Modelo 
and Constellation, imports, markets, and sells certain Modelo's brands 
into the United States.
    Constellation, headquartered in Victor, New York, is a beer, wine, 
and spirits company with a portfolio of more than 100 products, 
including Robert Mondavi, Clos du Bois, Ruffino, and SVEDKA Vodka. It 
produces wine and distilled spirits, with more than forty facilities 
worldwide. Constellation is not currently a beer brewer; 
Constellation's only involvement in the beer market in the United 
States is through its interest in Crown, although it actively 
participates in the management of that joint venture. Constellation is 
a Defendant to this action for the purpose of assuring the satisfaction 
of the objectives of the proposed Final Judgment, including the 
expansion of the Piedras Negras Brewery.
    ABI currently holds a 35.3% direct interest in Modelo, and a 23.3% 
direct interest in Modelo's operating subsidiary Diblo S.A. de C.V 
(``Diblo''). ABI's current stake in Modelo gives ABI certain minority 
voting rights and the right to appoint nine members of Modelo's 19-
member Board of Directors.\7\
---------------------------------------------------------------------------

    \7\ The sale of the Divestiture Assets to Constellation (or 
another acquirer) will eliminate ABI's minority right and sharing of 
profits in Modelo's U.S. business.

---------------------------------------------------------------------------

[[Page 30410]]

    On June 28, 2012, ABI agreed to purchase, through an Agreement and 
Plan of Merger, along with a Transaction Agreement between ABI, Modelo 
and Diblo, the remaining equity interest from Modelo's owners, thereby 
obtaining full ownership and control of Modelo, for approximately $20.1 
billion.
    At the time, Defendants also proposed to sell Modelo's stake in 
Crown to Constellation and enter into a ten-year supply agreement to 
provide Modelo beer to Constellation to import into the United States. 
The United States rejected this proposed vertical ``fix'' to a 
horizontal merger as inadequate to address the likely harm to 
competition that would result from the proposed transaction. Most 
importantly, the proposed supply agreement would not have alleviated 
the potential harm to competition that the proposed transaction 
created: It did not create an independent, fully-integrated brewer with 
permanent control of Modelo Brand Beer in the United States. The United 
States therefore filed a Complaint to enjoin this proposed acquisition 
on January 31, 2013.

B. The Competitive Effects of the Transaction on the Market for Beer in 
the United States

1. Relevant Markets
    Beer is a relevant product market under Section 7. Wine, distilled 
liquor, and other alcoholic or non-alcoholic beverages do not 
substantially constrain the prices of beer, and a hypothetical 
monopolist in the beer market could profitably raise prices. ABI and 
other brewers generally categorize beers internally into different 
tiers based primarily on price, including sub-premium, premium, premium 
plus, and high-end. However, beers in different categories compete with 
each other, particularly when in adjacent tiers. For example, Modelo's 
Corona Extra--usually considered a high-end beer--regularly targets 
ABI's Bud Light, a premium light beer, as its primary competitor.
    Both national and local geographic markets exist in this industry. 
The proposed merger would likely result in increased prices for beer in 
the United States market as a whole and in at least 26 Metropolitan 
Statistical Areas (``MSAs''). Large beer companies make competitive 
decisions and develop strategies regarding product development, 
marketing, and brand-building on a national level. Further, large beer 
brewers typically create and implement national pricing strategies.
    However, beer brewers make many pricing and promotional decisions 
at the local level, reflecting local brand preferences, demographics, 
and other factors, which can vary significantly from one local market 
to another. The 26 MSAs alleged in the Complaint are areas in which 
beer purchasers are particularly vulnerable to targeted price 
increases.
2. Competitive Effects
    The beer industry in the United States is highly concentrated and 
would become more so if ABI were allowed to acquire all of the 
remaining Modelo assets required to compete in the United States, as 
the transaction was originally proposed. ABI and MillerCoors, the two 
largest beer brewers in the United States, account for more than 65% of 
beer sold in the United States. Modelo is the third largest beer 
brewer, constituting approximately 7% of national sales, and in certain 
MSAs its market share approaches 20%. Heineken and hundreds of smaller 
fringe competitors comprise the remainder of the beer market. In the 26 
MSAs alleged in the Complaint, ABI and Modelo control an even larger 
share of the market, creating a presumption under the Clayton Act that 
the merger of the two firms would result in harm to competition in 
those markets.
    Even so, the market shares of ABI and Modelo understate the 
potential anticompetitive effect of the proposed merger. The United 
States determined through its investigation that large brewers engage 
in significant levels of tacit coordination and that coordination has 
reduced competition and increased prices. In most regions of the United 
States, major brewers implement price increases on an annual basis in 
the fall. ABI is usually first to announce its annual price increases, 
setting forth recommended wholesale price increases designed to be 
transparent and to encourage others to follow. MillerCoors typically 
announces its price increases after ABI has publicized its price 
increases, and largely matches ABI's price increases. As a result, 
although ABI and MillerCoors have highly visible competing advertising 
and product innovation programs, they do not substantially constrain 
each other's annual price increases.
    The third largest brewer, Modelo, has increasingly constrained 
ABI's and MillerCoors's ability to raise prices. To build its market 
share, Modelo (through its importer Crown) has tended not to follow the 
announced price increases of ABI and MillerCoors. This competitive 
strategy narrowed the price gap between Modelo's high-end brands and 
ABI's and MillerCoors's premium and premium plus brands, allowing 
Modelo to build market share at the expense of ABI and MillerCoors. By 
compressing the price gap between high-end and premium brands, Modelo's 
actions have increasingly limited ABI's ability to lead beer prices 
higher. Therefore, ABI's acquisition of Modelo, as originally proposed, 
would have been likely to lead to higher beer prices in the United 
States by eliminating a competitor that resisted coordinated price 
increases initiated by the market share leader, ABI.
    ABI and Modelo compete aggressively. Modelo brands compete with ABI 
brands in numerous venues and occasions, appealing to similar sets of 
consumers in terms of taste, quality, consumer perception, and value. 
As a result, Modelo (through its importer Crown) often sets its prices 
in particular markets with reference to the price of the leading ABI 
products, and engages in price competition through promotional activity 
designed to take share from the market leaders. Because a significant 
number of consumers regard the ABI brands and Modelo brands as 
substitutes, the merger, absent the divestiture, would create an 
incentive for ABI to raise the prices of some or all of the merged 
firm's brands and profitably recapture sales that result from consumers 
switching between the ABI brands and Modelo brands.
    Further, competition from Modelo has spurred additional significant 
product innovation from ABI, including the introduction of Bud Light 
Lime, the introduction of new packages such as ``Azulitas,'' \8\ and 
the expansion of Landshark Lager. The merger of the two firms, as 
originally proposed, would have been likely to negatively affect ABI's 
incentive to innovate, bring new products to market, and otherwise 
invest in attracting consumers away from the unique Modelo brands.
---------------------------------------------------------------------------

    \8\ Azulitas are 8 ounce cans of Bud Light that compete directly 
with Modelo's ``Coronitas.''
---------------------------------------------------------------------------

3. Entry and Expansion
    Neither entry into the beer market, nor any repositioning of 
existing brewers, would undo the anticompetitive harm from ABI's 
acquisition of Modelo, as originally proposed. Modelo's brands compete 
well against ABI due to their brand positioning and reputation, their 
well-established marketing and broad acceptance by a wide range of 
consumers, and their robust distribution network resulting in the near-
ubiquity of Corona Extra in the establishments where consumers purchase 
and

[[Page 30411]]

consume beer. Any entrant would face enormous costs in attempting to 
replicate these assets, and would take many years to succeed. Building 
nationally recognized and accepted brands, which retailers will support 
with feature and display activity, is difficult, expensive, and time 
consuming. While consumers have undoubtedly benefited from the launch 
of many individual craft and specialty beers in the United States, the 
multiplicity of such brands does not replace the nature, scale, and 
scope of competition that Modelo provides today, and that would 
otherwise be eliminated by the proposed transaction.

III. Explanation of the Proposed Final Judgment

    The proposed Final Judgment contains a clean, structural remedy 
that eliminates the likely anticompetitive effects of the acquisition 
in the market for beer in the United States and the 26 local markets 
identified in the Complaint. The divestitures required by the proposed 
Final Judgment will create an independent and economically viable 
competitor that will stand in the shoes of Modelo in the United States. 
Specifically, the divestiture of the Piedras Negras Brewery and 
Modelo's interest in Crown, and the perpetual brand licenses required 
by the proposed Final Judgment, will vest in Constellation (or an 
alternative purchaser, should ABI's divestiture to Constellation not be 
completed) the brewing capacity, the assets, and the other rights 
needed to produce, market, and sell Modelo Brand Beer in a manner 
similar to that which we see today. In short, the divestiture preserves 
the current structure of the beer market in the United States by 
maintaining an independent brewer with an incentive to resist following 
ABI's price leadership in order to expand share. Furthermore, the 
proposed Final Judgment puts an end to the existing entanglements 
between ABI and Modelo with respect to the United States beer market. 
Finally, the proposed Final Judgment also provides for supervision by 
this Court and the United States of the transition services necessary 
to allow Constellation or another acquirer to compete effectively while 
the divestiture and expansion of the Piedras Negras Brewery are 
completed.

A. The Divestiture

    The proposed Final Judgment requires ABI, within 90 days after 
entry of the Stipulation and Order by the Court, to (1) divest to 
Constellation Modelo's current interest in Crown, along with the 
Piedras Negras Brewery and associated assets, and (2) grant to 
Constellation a perpetual, assignable license to ten of the most 
popular Modelo Brand Beers, including Corona and Modelo Especial, for 
sale in the United States.\9\ The rights, assets, and interests to be 
divested to Constellation are set forth in the transaction agreements 
that are attached as exhibits to the proposed Final Judgment. If the 
divestiture to Constellation should fail to close, ABI would be 
required to make those same divestitures, and grant the same licenses, 
to another acquirer acceptable to the United States for the purpose of 
enabling that alternative acquirer to brew Modelo Brand Beer, and to 
market and distribute them in the United States market.
---------------------------------------------------------------------------

    \9\ The licensed brands include all the brands that Modelo 
currently offers (through its distributor Crown) in the United 
States: Corona, Corona Light, Modelo Especial, Negra Modelo, Modelo 
Light, Pacifico, and Victoria. The license also includes certain 
brands not yet offered in the United States, but that Constellation 
would be free to launch here: Pacifico Light, Barrilito, and 
Le[oacute]n.
---------------------------------------------------------------------------

    The proposed Final Judgment differs significantly from the deal 
that ABI sought unilaterally to impose and that is described in the 
Complaint. It vertically integrates the production and sale of Modelo 
Brand Beer in the United States and eliminates ABI's control of Modelo 
Brand Beer in the United States, as illustrated below:
[GRAPHIC] [TIFF OMITTED] TN22MY13.003

    The proposed Final Judgment requires ABI to license rather than 
divest the brands because ABI retains the right to brew and market 
Modelo's brands throughout the rest of the world. The structure of the 
licenses provides Constellation all the rights and abilities it needs 
to compete in the United States as Modelo did before the merger, 
including the opportunity to introduce new brands in the United States 
that Modelo already markets in Mexico, such as Le[oacute]n. The 
licenses are perpetual and assignable and cannot be terminated by ABI 
for any reason. They include the right to develop and launch new brand 
extensions and packages, to update brand recipes in response to 
consumer demand, and to adopt, or decline to adopt, any updated recipes 
for any of the licensed brands that ABI may choose to use outside the 
United States. This flexibility allows Constellation to adapt to 
changing market conditions in the United States to compete effectively 
in the future, and reduces ABI's ability to interfere with those 
adaptations.
    The assets must be divested and/or licensed in such a way as to 
satisfy the United States, in its sole discretion, that the operations 
can and will be operated by the purchaser as a viable, ongoing business 
that can compete effectively in the relevant market. Defendants ABI and 
Modelo must take all reasonable steps necessary to accomplish the 
divestiture

[[Page 30412]]

quickly. In the event that ABI does not accomplish the divestiture 
within 90 days as prescribed in the proposed Final Judgment, the Final 
Judgment provides that the Court will appoint a trustee selected by the 
United States to complete the divestiture.\10\
---------------------------------------------------------------------------

    \10\ The proposed Final Judgment also provides that the United 
States may extend the time for ABI to accomplish the divestiture by 
up to 60 days, in its sole discretion.
---------------------------------------------------------------------------

B. Mandatory Expansion of the Piedras Negras Brewery

    For the divestiture to be successful in replacing Modelo as a 
competitor, Constellation must expand the Piedras Negras Brewery's 
production capabilities. Section V.A of the proposed Final Judgment 
requires Constellation (or an alternative purchaser) to expand the 
Piedras Negras Brewery to be able to produce 20 million hectoliters of 
packaged beer annually by December 31, 2016. Such expansion will allow 
Constellation to produce, independently from ABI, enough Modelo Brand 
Beer to replicate Modelo's current competitive role in the United 
States. The required expansion also allows for expected future growth 
in sales of the licensed brands. In carrying out the expansion, 
Constellation is required to use its best efforts to adhere to specific 
construction milestones delineated in Sections V.A.1-8 of the proposed 
Final Judgment. A Monitoring Trustee will be appointed who will have 
the responsibility to observe the expansion and to report to the United 
States and the Court on whether the expansion is on track to be 
completed in the required timeframe.
    Requiring the buyer of divested assets to improve those assets for 
the purposes of competing against the seller is an exceptional remedy 
that the United States found appropriate under the specific set of 
facts presented here. The recently constructed Piedras Negras Brewery 
is an ideal brewery for divestiture because it is near the United 
States border, is highly efficient, and features modular construction 
that was designed and equipped specifically to allow for economical 
expansion. No other combination of Modelo's brewing assets would have 
properly addressed the competitive harm caused by the proposed merger 
and allowed the acquirer of the Divestiture Assets to compete as 
effectively and economically with ABI as Modelo does today.

C. Employee Retention Provisions; Transitional Support and Supply 
Agreements

    The proposed Final Judgment provides for or incorporates agreements 
protecting Constellation's ability to operate and expand the Piedras 
Negras Brewery while actively competing in the United States.
    As part of the asset purchase, Constellation (or an alternative 
purchaser) will become the owner of the company that employs personnel 
who currently operate the Piedras Negras Brewery.\11\ Section IV.D of 
the proposed Final Judgment prevents ABI or Modelo from interfering 
with Constellation's retention of those employees as part of the asset 
transfer. Together with the transition services, this provides 
Constellation with the specific knowledge necessary to operate the 
Piedras Negras Brewery.
---------------------------------------------------------------------------

    \11\ The company is Servicios Modelo de Coahuila, S.A. de C.V., 
a subsidiary of Grupo Modelo with its headquarters in Coahuila, 
Mexico.
---------------------------------------------------------------------------

    Sections IV.G-I of the proposed Final Judgment require the parties 
to enter into transition services and interim supply agreements. The 
transition services agreement (Section IV.G) requires ABI to provide 
consulting services with respect to topics such as the management of 
the Piedras Negras Brewery, logistics, material resource planning, and 
other general administrative services that Modelo currently provides to 
the Piedras Negras Brewery. The transition services agreement also 
requires ABI to supply certain key inputs (such as aluminum cans, 
glass, malt, yeast, and corn starch) for a limited time. The interim 
supply agreement (Section IV.H-I) requires ABI to supply Constellation 
with sufficient Modelo Brand Beer each year to make up for any 
difference between the demand for such beers in the United States and 
the Piedras Negras Brewery's capacity to fulfill that demand.
    The transition services and interim supply agreements are necessary 
to allow Constellation (or an alternative purchaser) to continue to 
compete in the United States during the time it takes to expand the 
Piedras Negras Brewery's capacity to brew and bottle beer, but are 
time-limited to assure that Constellation will become a fully 
independent competitor to ABI as soon as practicable. As such, in 
conjunction with the firewall provisions described below, they prevent 
the vertical supply arrangement from causing competitive harm in the 
near term. The proposed Final Judgment subjects these agreements, 
including any extensions, to monitoring by a court-appointed trustee 
and, in the event that a firm other than Constellation acquires the 
assets, the acquisition requires approval by the United States.

D. Distribution of Modelo Brand Beer

    Effective distribution is important for a brewer to be competitive 
in the beer industry. The proposed Final Judgment imposes two 
requirements on ABI regarding its distribution network that are 
designed to limit ABI's ability to interfere with Constellation's 
effective distribution of Modelo Brand Beer. These requirements ensure 
that Constellation can reduce the threat of discrimination in 
distribution at the hands of ABI-owned distributors or ABI-sponsored 
distributor incentive programs, in recognition of the influence ABI 
already exercises in the concentrated beer distribution markets.
    First, Section V.C of the proposed Final Judgment provides that, 
for ABI's majority-owned distributors (``ABI-Owned Distributors'') that 
distribute Modelo Brand Beer, Constellation will have a window of 
opportunity to terminate that distribution relationship and direct the 
ABI-owned distributor to sell the distribution rights to another 
distributor. Similarly, should ABI subsequently acquire any 
distributors that have contractual rights to distribute Modelo Brand 
Beer, Constellation may require ABI to sell those rights.
    Second, the proposed Final Judgment prevents ABI for 36 months from 
downgrading a distributor's ranking in ABI's distributor incentive 
programs by virtue of the distributor's decision to carry Modelo Brand 
Beer. The 36-month time period tracks the initial term of the 
transition service and interim supply agreements, and thus allows 
Constellation to maintain a status quo position for the Modelo Brand 
Beer in ABI's distribution incentive programs until Constellation can 
operate independently of ABI.

E. Divestiture Trustee

    In the event that Defendants do not accomplish the divestiture as 
prescribed in the proposed Final Judgment, either to Constellation or 
to an alternative buyer, Section VI of the proposed Final Judgment 
provides that the Court will appoint a Divestiture Trustee selected by 
the United States to complete the divestiture. If a Divestiture Trustee 
is appointed, the proposed Final Judgment provides that ABI will pay 
all costs and expenses of the Divestiture Trustee. Under the proposed 
Final Judgment, the Divestiture Trustee shall have the ability to 
modify the package of assets to be divested, should such modification 
become necessary to enable an acquirer

[[Page 30413]]

to expand and operate the Piedras Negras Brewery or if there has been a 
breach in the representations made by ABI and Modelo regarding the 
completeness of the assets. After his or her appointment becomes 
effective, the Divestiture Trustee will file monthly reports with the 
Court and the United States setting forth his or her efforts to 
accomplish the divestiture.

F. Monitoring Trustee

    Section VIII of the proposed Final Judgment permits the appointment 
of a Monitoring Trustee by the United States in its sole discretion and 
the United States intends to appoint one and seek the Court's approval. 
The Monitoring Trustee will ensure that Defendants expeditiously comply 
with all of their obligations and perform all of their responsibilities 
under the proposed Final Judgment and the Stipulation and Order; that 
the Divestiture Assets remain economically viable, competitive, and 
ongoing assets; and that competition in the sale of beer in the United 
States in the relevant markets is maintained until the required 
divestitures and other requirements of the proposed Final Judgment have 
been accomplished. The Monitoring Trustee will have the power and 
authority to monitor Defendants' compliance with the terms of the Final 
Judgment and attendant interim supply and services contracts. The 
Monitoring Trustee will have access to all personnel, books, records, 
and information necessary to monitor such compliance, and will serve at 
the cost and expense of ABI. The Monitoring Trustee will file reports 
every 90 days with the United States and the Court setting forth 
Defendants' efforts to comply with their obligations under the proposed 
Final Judgment and the Stipulation and Order.

G. Stipulation and Order Provisions

    Defendants have entered into the Stipulation and Order attached as 
an exhibit to the Explanation of Consent Decree Procedures, which was 
filed simultaneously with the Court, to ensure that, pending the 
divestitures, the Divestiture Assets are maintained as an ongoing, 
economically viable, and active business. The Stipulation and Order 
ensures that the Divestiture Assets are preserved and maintained in a 
condition that allows the divestitures to be effective. The Stipulation 
and Order also adds Constellation as a Defendant for purposes of 
entering the Final Judgment.

H. Notification Provisions

    Section XII of the proposed Final Judgment requires ABI to notify 
the United States in advance of executing certain transactions that 
would not otherwise be reportable under the Hart-Scott-Rodino Antitrust 
Improvements Act of 1976. The transactions covered by these provisions 
include the acquisition or license of any interest in non-ABI brewing 
assets or brands, excluding acquisitions of: (1) Foreign-located assets 
that do not generate at least $7.5 million in annual gross revenue from 
beer sold for resale in the United States; (2) certain ordinary-course 
asset purchases and passive investments; and (3) distribution licenses 
that do not generate at least $3 million in annual gross revenue in the 
United States. This provision ensures that the United States will have 
the ability to take action in advance of any transactions that could 
potentially impact competition in the United States beer market.

I. Firewall

    Section XIII of the proposed Final Judgment requires ABI and Modelo 
to implement firewall procedures to prevent Constellation's (or an 
alternative acquirer's) confidential business information from being 
used within ABI or Modelo for any purpose that could harm competition 
or provide an unfair competitive advantage to ABI based on its role as 
a temporary supplier to Constellation under either the transition 
services or interim supply agreements. Within ten days of the Court 
approving the Stipulation and Order described above, ABI and Modelo 
must submit their planned procedures for maintaining a firewall. 
Additionally, ABI and Modelo must brief certain officers of the company 
and business personnel who have responsibility for commercial 
interactions with Constellation as to their required treatment of 
Constellation's confidential business information. This provision 
ensures that ABI and Modelo cannot improperly use any confidential 
information they receive from Constellation in ways that would harm 
competition in the beer industry or impair Constellation's competitive 
prospects.

IV. Remedies Available to Potential Private Litigants

    Section 4 of the Clayton Act, 15 U.S.C. 15, provides that any 
person who has been injured as a result of conduct prohibited by the 
antitrust laws may bring suit in federal court to recover three times 
the damages the person has suffered, as well as costs and reasonable 
attorneys' fees. Entry of the proposed Final Judgment will neither 
impair nor assist the bringing of any private antitrust damage action. 
Under the provisions of Section 5(a) of the Clayton Act, 15 U.S.C. 
16(a), the proposed Final Judgment has no prima facie effect in any 
subsequent private lawsuit that may be brought against Defendants.

V. Procedures Available for Modification of the Proposed Final Judgment

    The United States and Defendants have stipulated that the proposed 
Final Judgment may be entered by the Court after compliance with the 
provisions of the APPA, provided that the United States has not 
withdrawn its consent. The APPA conditions entry upon the Court's 
determination that the proposed Final Judgment is in the public 
interest.
    The APPA provides a period of at least sixty (60) days preceding 
the effective date of the proposed Final Judgment within which any 
person may submit to the United States written comments regarding the 
proposed Final Judgment. Any person who wishes to comment should do so 
within sixty (60) days of the date of publication of this Competitive 
Impact Statement in the Federal Register, or the last date of 
publication in a newspaper of the summary of this Competitive Impact 
Statement, whichever is later. All comments received during this period 
will be considered by the United States Department of Justice, which 
remains free to withdraw its consent to the proposed Final Judgment at 
any time prior to the Court's entry of judgment. The comments and the 
response of the United States will be filed with the Court. In 
addition, comments will be posted on the U.S. Department of Justice, 
Antitrust Division's internet Web site and published in the Federal 
Register.
    Written comments should be submitted to: James Tierney, Chief, 
Networks and Technology Enforcement Section, Antitrust Division, United 
States Department of Justice, 450 5th Street NW., Suite 7100, 
Washington, DC 20530.
    The proposed Final Judgment provides that the Court retains 
jurisdiction over this action, and the parties may apply to the Court 
for any order necessary or appropriate for the modification, 
interpretation, or enforcement of the Final Judgment.

VI. Alternatives to the Proposed Final Judgment

    The United States considered, before initiating this lawsuit to 
enjoin the proposed merger, the Defendants' proposal of selling 
Modelo's stake in Crown to Constellation and entering into a ten-year 
supply agreement. The

[[Page 30414]]

United States ultimately rejected this proposal as inadequate to 
address the merger's likely anticompetitive effects. The settlement 
embodied within the proposed Final Judgment differs significantly from 
the Defendants' original solution. Most importantly, the proposed Final 
Judgment ensures that Modelo Brand Beer sold in the United States will 
be brewed, imported, and sold by a firm that is vertically integrated 
and completely independent from ABI. Unlike the Defendants' original 
proposal, which left Constellation with no brewing assets, beholden to 
ABI for the supply of beer, and was terminable after ten years, the 
proposed Final Judgment ensures Constellation will have independent 
brewing assets and the ownership of the Modelo Brand Beer for sale in 
the United States in perpetuity.
    The United States also considered, as an alternative to the 
proposed Final Judgment, a full trial on the merits against Defendants 
ABI and Modelo. The United States could have continued the litigation 
and sought preliminary and permanent injunctions against ABI's 
acquisition of Modelo. The United States is satisfied, however, that 
the divestiture of assets described in the proposed Final Judgment, and 
concomitant expansion of the brewery assets, will preserve competition 
for the provision of beer in the relevant market identified by the 
United States. Thus, the proposed Final Judgment would achieve all or 
substantially all of the relief the United States would have obtained 
through litigation, but avoids the time, expense, and uncertainty of a 
full trial on the merits of the Complaint.

VII. Standard of Review Under the APPA for the Proposed Final Judgment

    The Clayton Act, as amended by the APPA, requires that proposed 
consent judgments in antitrust cases brought by the United States be 
subject to a sixty-day comment period, after which the court shall 
determine whether entry of the proposed Final Judgment ``is in the 
public interest.'' 15 U.S.C. 16(e)(1). In making that determination, 
the court, in accordance with the statute as amended in 2004, is 
required to consider:

    (A) The competitive impact of such judgment, including 
termination of alleged violations, provisions for enforcement and 
modification, duration of relief sought, anticipated effects of 
alternative remedies actually considered, whether its terms are 
ambiguous, and any other competitive considerations bearing upon the 
adequacy of such judgment that the court deems necessary to a 
determination of whether the consent judgment is in the public 
interest; and
    (B) the impact of entry of such judgment upon competition in the 
relevant market or markets, upon the public generally and 
individuals alleging specific injury from the violations set forth 
in the complaint including consideration of the public benefit, if 
any, to be derived from a determination of the issues at trial.

15 U.S.C. 16(e)(1)(A) & (B). In considering these statutory factors, 
the court's inquiry is necessarily a limited one as the government is 
entitled to ``broad discretion to settle with the defendant within the 
reaches of the public interest.'' United States v. Microsoft Corp., 56 
F.3d 1448, 1461 (D.C. Cir. 1995); see generally United States v. SBC 
Commc'ns, Inc., 489 F. Supp. 2d 1 (D.D.C. 2007) (assessing public 
interest standard under the Tunney Act); United States v. InBev N.V./
S.A., 2009-2 Trade Cas. (CCH) ] 76,736, 2009 U.S. Dist. LEXIS 84787, 
No. 08-1965 (JR), at *3, (D.D.C. Aug. 11, 2009) (noting that the 
court's review of a consent judgment is limited and only inquires 
``into whether the government's determination that the proposed 
remedies will cure the antitrust violations alleged in the complaint 
was reasonable, and whether the mechanism to enforce the final judgment 
are clear and manageable.'').\12\
---------------------------------------------------------------------------

    \12\ The 2004 amendments substituted ``shall'' for ``may'' in 
directing relevant factors for court to consider and amended the 
list of factors to focus on competitive considerations and to 
address potentially ambiguous judgment terms. Compare 15 U.S.C. 
16(e) (2004), with 15 U.S.C. Sec.  16(e)(1) (2006); see also SBC 
Commc'ns, 489 F. Supp. 2d at 11 (concluding that the 2004 amendments 
``effected minimal changes'' to Tunney Act review).
---------------------------------------------------------------------------

    As the United States Court of Appeals for the District of Columbia 
Circuit has held, under the APPA a court considers, among other things, 
the relationship between the remedy secured and the specific 
allegations set forth in the government's complaint, whether the decree 
is sufficiently clear, whether enforcement mechanisms are sufficient, 
and whether the decree may positively harm third parties. See 
Microsoft, 56 F.3d at 1458-62. With respect to the adequacy of the 
relief secured by the decree, a court may not ``engage in an 
unrestricted evaluation of what relief would best serve the public.'' 
United States v. BNS, Inc., 858 F.2d 456, 462 (9th Cir. 1988) (citing 
United States v. Bechtel Corp., 648 F.2d 660, 666 (9th Cir. 1981)); see 
also Microsoft, 56 F.3d at 1460-62; United States v. Alcoa, Inc., 152 
F. Supp. 2d 37, 40 (D.D.C. 2001); InBev, 2009 U.S. Dist. LEXIS 84787, 
at *3. Courts have held that:

[t]he balancing of competing social and political interests affected 
by a proposed antitrust consent decree must be left, in the first 
instance, to the discretion of the Attorney General. The court's 
role in protecting the public interest is one of insuring that the 
government has not breached its duty to the public in consenting to 
the decree. The court is required to determine not whether a 
particular decree is the one that will best serve society, but 
whether the settlement is ``within the reaches of the public 
interest.'' More elaborate requirements might undermine the 
effectiveness of antitrust enforcement by consent decree.

    Bechtel, 648 F.2d at 666 (emphasis added) (citations omitted).\13\ 
In determining whether a proposed settlement is in the public interest, 
a district court ``must accord deference to the government's 
predictions about the efficacy of its remedies, and may not require 
that the remedies perfectly match the alleged violations.'' SBC 
Commc'ns, 489 F. Supp. 2d at 17; see also Microsoft, 56 F.3d at 1461 
(noting the need for courts to be ``deferential to the government's 
predictions as to the effect of the proposed remedies''); United States 
v. Archer-Daniels-Midland Co., 272 F. Supp. 2d 1, 6 (D.D.C. 2003) 
(noting that the court should grant due respect to the United States' 
prediction as to the effect of proposed remedies, its perception of the 
market structure, and its views of the nature of the case).
---------------------------------------------------------------------------

    \13\ Cf. BNS, 858 F.2d at 464 (holding that the court's 
``ultimate authority under the [APPA] is limited to approving or 
disapproving the consent decree''); United States v. Gillette Co., 
406 F. Supp. 713, 716 (D. Mass. 1975) (noting that, in this way, the 
court is constrained to ``look at the overall picture not 
hypercritically, nor with a microscope, but with an artist's 
reducing glass''). See generally Microsoft, 56 F.3d at 1461 
(discussing whether ``the remedies [obtained in the decree are] so 
inconsonant with the allegations charged as to fall outside of the 
`reaches of the public interest''').
---------------------------------------------------------------------------

    Courts have greater flexibility in approving proposed consent 
decrees than in crafting their own decrees following a finding of 
liability in a litigated matter. ``[A] proposed decree must be approved 
even if it falls short of the remedy the court would impose on its own, 
as long as it falls within the range of acceptability or is `within the 
reaches of public interest.''' United States v. Am. Tel. & Tel. Co., 
552 F. Supp. 131, 151 (D.D.C. 1982) (citations omitted) (quoting United 
States v. Gillette Co., 406 F. Supp. 713, 716 (D. Mass. 1975)), aff'd 
sub nom. Maryland v. United States, 460 U.S. 1001 (1983); see also 
United States v. Alcan Aluminum Ltd., 605 F. Supp. 619, 622 (W.D. Ky. 
1985) (approving the consent decree even though the court would have 
imposed a greater remedy). To meet this standard, the United States 
``need only provide a factual basis for concluding that the settlements 
are reasonably adequate remedies for the

[[Page 30415]]

alleged harms.'' SBC Commc'ns, 489 F. Supp. 2d at 17.
    Moreover, the court's role under the APPA is limited to reviewing 
the remedy in relationship to the violations that the United States has 
alleged in its Complaint, and does not authorize the court to 
``construct [its] own hypothetical case and then evaluate the decree 
against that case.'' Microsoft, 56 F.3d at 1459; see also InBev, 2009 
U.S. Dist. LEXIS 84787, at *20 (``the `public interest' is not to be 
measured by comparing the violations alleged in the complaint against 
those the court believes could have, or even should have, been 
alleged''). Because the ``court's authority to review the decree 
depends entirely on the government's exercising its prosecutorial 
discretion by bringing a case in the first place,'' it follows that 
``the court is only authorized to review the decree itself,'' and not 
to ``effectively redraft the complaint'' to inquire into other matters 
that the United States did not pursue. Microsoft, 56 F.3d at 1459-60. 
As this court confirmed in SBC Communications, courts ``cannot look 
beyond the complaint in making the public interest determination unless 
the complaint is drafted so narrowly as to make a mockery of judicial 
power.'' SBC Commc'ns, 489 F. Supp. 2d at 15.
    In its 2004 amendments, Congress made clear its intent to preserve 
the practical benefits of utilizing consent decrees in antitrust 
enforcement, adding the unambiguous instruction that ``[n]othing in 
this section shall be construed to require the court to conduct an 
evidentiary hearing or to require the court to permit anyone to 
intervene.'' 15 U.S.C. 16(e)(2). The language wrote into the statute 
what Congress intended when it enacted the Tunney Act in 1974, as 
Senator Tunney explained: ``[t]he court is nowhere compelled to go to 
trial or to engage in extended proceedings which might have the effect 
of vitiating the benefits of prompt and less costly settlement through 
the consent decree process.'' 119 Cong. Rec. 24,598 (1973) (statement 
of Senator Tunney). Rather, the procedure for the public interest 
determination is left to the discretion of the court, with the 
recognition that the court's ``scope of review remains sharply 
proscribed by precedent and the nature of Tunney Act proceedings.'' SBC 
Commc'ns, 489 F. Supp. 2d at 11.\14\
---------------------------------------------------------------------------

    \14\ See United States v. Enova Corp., 107 F. Supp. 2d 10, 17 
(D.D.C. 2000) (noting that the ``Tunney Act expressly allows the 
court to make its public interest determination on the basis of the 
competitive impact statement and response to comments alone''); 
United States v. Mid-Am. Dairymen, Inc., 1977-1 Trade Cas. (CCH) ] 
61,508, at 71,980 (W.D. Mo. 1977) (``Absent a showing of corrupt 
failure of the government to discharge its duty, the Court, in 
making its public interest finding, should . . . carefully consider 
the explanations of the government in the competitive impact 
statement and its responses to comments in order to determine 
whether those explanations are reasonable under the 
circumstances.''); S. Rep. No. 93-298, 93d Cong., 1st Sess., at 6 
(1973) (``Where the public interest can be meaningfully evaluated 
simply on the basis of briefs and oral arguments, that is the 
approach that should be utilized.'').
---------------------------------------------------------------------------

VIII. Determinative Documents

    The following determinative materials or documents within the 
meaning of the APPA were considered by the United States in formulating 
the proposed Final Judgment:
     The Stock Purchase Agreement attached and labeled as 
Exhibit A to the proposed Final Judgment;
     The Amended and Restated Membership Interest Purchase 
Agreement attached and labeled as Exhibit A to the proposed Final 
Judgment;
     The Amended and Restated Sub-License Agreement attached 
and labeled as Exhibit A to the Stock Purchase Agreement;
     The Transition Services Agreement attached and labeled as 
Exhibit B to the Stock Purchase Agreement; and
     The Interim Supply Agreement attached and labeled as 
Exhibit A to the Amended and Restated Membership Interest Purchase 
Agreement.

    Dated: April 19, 2013.

    Respectfully submitted,

s/Mary N. Strimel

Mary N. Strimel (D.C. Bar No. 455303),

Trial Attorney, United States Department of Justice, Antitrust 
Division, 450 5th Street NW., Suite 7100, Washington, DC 20530, Tel: 
(202) 616-5949, mary.strimel@usdoj.gov.

United States District Court For the District of Columbia

UNITED STATES OF AMERICA, Plaintiff, v. ANHEUSER-BUSCH InBEV SA/NV, et 
al., Defendants.

Civil Action No. 13-127 (RWR)

Judge Richard W. Roberts

Certificate of Service

    I hereby certify that on the 19th day of April, 2013, I 
electronically filed the below-listed documents with the Clerk of the 
Court using the CM/ECF system:

1. United States' Explanation of Consent Decree Procedures Attachment 
A: Stipulation and Order Attachment B: Final Judgment [proposed]
2. Competitive Impact Statement
3. Motion for Leave to File Exhibits Under Seal
4. Notice of Filing Under Seal; and
5. Certificate of Service

    The CM/ECF system will send a notice of electronic filing (NEF) to 
counsel for the Defendants:
    For Defendant Anheuser Busch InBev SA/NV:

Steven C. Sunshine
Gregory Bestor Craig
SKADDEN, ARPS, SLATE, MEAGHER & FLOM LLP, 1440 New York Avenue NW., 
Washington, DC 20005-2111, Tel: (202) 371-7000, 
Steven.Sunshine@skadden.com, Gregory.Craig@skadden.com

Ian G. John
Karen Hoffman Lent
 SKADDEN, ARPS, SLATE, MEAGHER & FLOM LLP, Four Times Square, New York, 
NY 10024, Tel: (212) 735-3495, Ian.John@skadden.com, 
Karen.Lent@skadden.com

Thomas J. Nolan
SKADDEN, ARPS, SLATE, MEAGHER & FLOM LLP, 300 South Grand Avenue, Suite 
3400, Los Angeles, California 90071, Tel. (213) 687-5250, 
Thomas.Nolan@skadden.com

    For Defendant Grupo Modelo S.A. de C.V.:

Richard J. Stark
Yonatan Even
CRAVATH, SWAINE & MOORE LLP, 825 Eighth Avenue, New York, NY 10019-
7475, Tel: (212) 474-1000, rstark@cravath.com, yeven@cravath.com

    The CM/ECF system will send a notice of electronic filing (NEF) to 
the counsel below, whom I also served with the above-listed documents 
via email after obtaining written consent pursuant to Fed. R. Civ. P. 
5(b)(2)(E):
    For Proposed Settlement Defendant Constellation Brands, Inc.,

Margaret H. Warner
Raymond A. Jacobsen, Jr.
Jon B. Dubrow
MCDERMOTT WILL & EMERY LLP, 500 North Capitol Street NW., Washington, 
DC 20001, Tel: (202) 756-8000, mwarner@mwe.com, rayjacobsen@mwe.com, 
jdubrow@mwe.com

    Respectfully submitted,

FOR PLAINTIFF
UNITED STATES OF AMERICA

/s/Mary N. Strimel

Mary N. Strimel (D.C. Bar No. 455303), Trial Attorney, Antitrust 
Division, U.S. Department of Justice, 450 Fifth Street NW., Suite 
7100, Washington, DC 20530, Telephone: (202) 616-5949, Email: 
mary.strimel@usdoj.gov

[[Page 30416]]



United States District Court For the District of Columbia

UNITED STATES OF AMERICA, Plaintiff, v. ANHEUSER-BUSCH InBEV SA/NV, et 
al., Defendants.

Civil Action No. 13-127 (RWR)

Judge Richard W. Roberts

Proposed Final Judgment

    Whereas, Plaintiff United States of America (``United States'') 
filed its Complaint against Defendants Anheuser-Busch InBev SA/NV 
(``ABI'') and Grupo Modelo, S.A.B. de C.V. (``Modelo'') on January 31, 
2013;
    And whereas, pursuant to a Stipulation among Plaintiff and the 
Defendants including Defendant Constellation Brands, Inc., 
(``Constellation''), the Court has joined Constellation as a Defendant 
to this action for the purposes of settlement and for the entry of this 
Final Judgment;
    And whereas, the United States and Defendants ABI, Modelo, and 
Constellation, by their respective attorneys, have consented to entry 
of this Final Judgment without trial or adjudication of any issue of 
fact or law, and without this Final Judgment constituting any evidence 
against or admission by any party regarding any issue of fact or law;
    And whereas, Defendants agree to be bound by the provisions of the 
Final Judgment pending its approval by the Court;
    And whereas, the essence of this Final Judgment is (a) the prompt 
and certain divestiture of certain rights and assets held by Defendants 
ABI and Modelo to Defendant Constellation (or other firm) as an 
Acquirer, to assure that competition is not substantially lessened; and 
(b) the necessary and appropriate build-out and capacity expansion of 
the Piedras Negras Brewery by the Acquirer over time to ensure that the 
Acquirer is able to compete in the United States independent of a 
relationship to the Sellers;
    And whereas, this Final Judgment requires Defendants ABI and Modelo 
to make certain divestitures to Defendant Constellation (or other 
Acquirer) for the purpose of remedying the loss of competition alleged 
in the Complaint;
    And whereas, Defendants ABI and Modelo intend for the divestiture 
of certain rights and assets to Constellation (or other Acquirer) to be 
permanent;
    And whereas, this Final Judgment requires Defendant Constellation 
(or other Acquirer) to make certain investments for the purpose of 
expanding the capacity of the Piedras Negras Brewery;
    And whereas, Defendants have represented to the United States that 
the divestitures required below can and will be made, and Defendant 
Constellation has represented that the Piedras Negras Brewery 
investments and expansion can and will be accomplished, and that 
Defendants will later raise no claim of hardship or difficulty as 
grounds for asking the Court to modify any of the provisions contained 
below;
    Now therefore, before any testimony is taken, without trial or 
adjudication of any issue of fact or law, and upon consent of the 
parties, it is ordered, adjudged, and decreed:

I. Jurisdiction

    This Court has jurisdiction over the subject matter of and each of 
the parties to this action. The Complaint states a claim upon which 
relief may be granted against Defendants ABI and Modelo under Section 7 
of the Clayton Act, as amended (15 U.S.C. 18). Pursuant to the 
Stipulation filed simultaneously with this Final Judgment joining 
Constellation as a Defendant to this action for the purpose of this 
Final Judgment, Constellation has consented to this Court's exercise of 
personal jurisdiction over it.

II. Definitions

    As used in the Final Judgment:
    A. ``ABI'' means Anheuser-Busch InBev SA/NV, its domestic and 
foreign parents, predecessors, divisions, subsidiaries, affiliates, 
partnerships and joint ventures (excluding Crown, and, prior to the 
completion of the Transaction, Modelo); and all directors, officers, 
employees, agents, and representatives of the foregoing. The terms 
``parent,'' ``subsidiary,'' ``affiliate,'' and ``joint venture'' refer 
to any person in which there is majority (greater than 50 percent) or 
total ownership or control between the company and any other person.
    B. ``ABI-Owned Distributor'' means any Distributor in which ABI 
owns more than 50 percent of the outstanding equity interests as of the 
date of the divestiture of the Divestiture Assets.
    C. ``Acquirer'' means:
    1. Constellation; or
    2. an alternative purchaser of the Divestiture Assets selected 
pursuant to the procedures set forth in this Final Judgment.
    D. ``Acquirer Confidential Information'' means:
    1. Confidential commercial information of Constellation (or other 
Acquirer) that has been obtained from such entity, including 
quantities, units, and prices of items ordered or purchased from the 
Sellers by the Acquirer, and any other competitively sensitive 
information regarding the Sellers' or the Acquirer's performance under 
the Interim Supply Agreement or the Transition Services Agreement; and
    2. confidential unit sales data, non-public pricing strategies and 
plans, or any other confidential commercial information of the Acquirer 
that either an ABI-Owned Distributor, or any other Distributor in which 
ABI acquires a majority interest after the date of the divestiture 
contemplated herein, obtains from the Acquirer by virtue of its 
relationship with the Acquirer.
    E. ``Beer'' means any fermented alcoholic beverage that (1) is 
composed in part of water, a type of starch, yeast, and a flavoring and 
(2) has undergone the process of brewing.
    F. ``Brewery Companies'' means (1) Compa[ntilde]ia Cervecera de 
Coahuila S.A. de C.V., a subsidiary of Grupo Modelo with its 
headquarters in Coahuila, Mexico, and (2) Servicios Modelo de Coahuila, 
S.A. de C.V., a subsidiary of Grupo Modelo with its headquarters in 
Coahuila, Mexico.
    G. ``Constellation'' means Constellation Brands, Inc., its domestic 
and foreign parents, predecessors, divisions, subsidiaries, affiliates, 
partnerships and joint ventures, including but not limited to, Crown, 
and all directors, officers, employees, agents, and representatives of 
the foregoing. The terms ``parent,'' ``subsidiary,'' ``affiliate,'' and 
``joint venture'' refer to any person in which there is majority 
(greater than 50 percent) or total ownership or control between the 
company and any other person.
    H. ``Covered Entity'' means any Beer brewer, importer, or brand 
owner (other than ABI) that derives more than $7.5 million in annual 
gross revenue from Beer sold for further resale in the United States, 
or from license fees generated by such Beer sales.
    I. ``Covered Interest'' means any non-ABI Beer brewing assets or 
any non-ABI Beer brand assets of, or any interest in (including any 
financial, security, loan, equity, intellectual property, or management 
interest), a Covered Entity; except that a Covered Interest shall not 
include (i) a Beer brewery or Beer brand located outside the United 
States that does not generate at least $7.5 million in annual gross 
revenue from Beer sold for resale in the United States; or (ii) a 
license to distribute a non-ABI Beer brand where said distribution 
license does not generate at least $3 million in annual gross revenue 
in the United States.

[[Page 30417]]

    J. ``Crown'' means Crown Imports, LLC, the joint venture between 
Constellation and Modelo that is in the business of importing Modelo 
Brand Beer into the United States, or any successor thereto.
    K. ``Defendants'' means ABI, Modelo, and Constellation, and any 
successor or assignee to all or substantially all of the business or 
assets of ABI, Modelo, or Constellation involved in the brewing of 
Beer.
    L. ``Distributor'' means a wholesaler in the Territory who acts as 
an intermediary between a brewer or importer of Beer and a retailer of 
Beer.
    M. ``Distributor Incentive Program'' means the Anheuser-Busch 
Voluntary Alignment Incentive Program and any other policy or program, 
either currently in effect or implemented hereafter, that offers some 
type of benefit to a Distributor based on the Distributor's sales 
performance, its loyalty in supporting any brand or brands of Beer, or 
its commercial support for any brand or brands of Beer, including 
decisions of which brands to carry or the sales volume of each.
    N. ``Divestiture Assets'' means all tangible and intangible assets, 
rights and interests necessary to effectuate the purposes of this Final 
Judgment, as specified by the following agreements attached hereto and 
labeled as Exhibit A to this Final Judgment: The Stock Purchase 
Agreement (including the exhibits thereto) and the MIPA (including the 
exhibits thereto). In addition:
    1. In the event that the Acquirer is a buyer other than 
Constellation, the Divestiture Assets shall also include the Entire 
Importer Interest, pursuant to ABI's Drag-Along Right to require 
Constellation to divest such interest, and subject to Constellation's 
right to receive compensation in the event of such divestiture, as set 
forth in Section 12.5 of the MIPA, attached hereto in Exhibit A; and
    a. in the event that a Divestiture Trustee is appointed, the 
Divestiture Trustee may, with the consent of the United States pursuant 
to Section IV.J herein: Include in the Divestiture Assets any 
additional assets, including tangible assets as well as intellectual 
property interests and other intangible interests or assets that extend 
beyond the United States, if the Divestiture Trustee finds the 
inclusion of such assets necessary to enable the Acquirer to expand the 
Piedras Negras Brewery to a Nominal Capacity of at least twenty (20) 
million hectoliters of packaged Beer per year, or to remedy any breach 
that the Monitoring Trustee has identified pursuant to Section VIII.B.3 
herein; or
    b. remove from the divestiture package any assets that are not 
needed by the Acquirer to accomplish the purposes of this Final 
Judgment, if such removal will facilitate the divestiture of Modelo's 
United States Beer business as contemplated by this Final Judgment.
    O. ``Drag-Along Right'' means ABI's right, as defined in Section 
12.5(b) of the MIPA, attached hereto in Exhibit A, to require 
Constellation to divest Constellation's interest in Crown in the event 
Constellation is not the Acquirer.
    P. ``Entire Importer Interest'' means Constellation's present 
interest in Crown, as defined in Section 12.5(b) of the MIPA, attached 
hereto in Exhibit A.
    Q. ``Hold Separate Stipulation and Order'' means the Stipulation 
and Order filed by the parties simultaneously herewith, which imposes 
certain duties on the Defendants with respect to the operation of the 
Divestiture Assets pending the proposed divestitures, and also adds 
Constellation as a Defendant in this action.
    R. ``Interim Supply Agreement'' means:
    1. The form of agreement between Modelo and Crown, attached as 
Exhibit A to the MIPA, attached hereto, and incorporated herein, or
    2. in the event the Divestiture Assets are sold to an Acquirer 
other than Constellation, an agreement between Sellers and the Acquirer 
to provide the same types of services under substantially similar terms 
as provided in Exhibit A to the MIPA incorporated hereto, subject to 
approval by the United States in its sole discretion.
    S. ``MIPA'' means the Amended and Restated Membership Interest 
Purchase Agreement among Constellation Beers Ltd., Constellation Brands 
Beach Holdings, Inc., Constellation Brands, Inc., and Anheuser-Busch 
InBev SA/NV dated February 13, 2013, as amended on April 19, 2013, and 
attached hereto in Exhibit A.
    T. ``Modelo'' means Grupo Modelo, S.A.B. de C.V., its domestic and 
foreign parents, predecessors, divisions, subsidiaries, affiliates, 
partnerships and joint ventures (excluding Crown and the entities 
listed on Exhibit B hereto); and all directors, officers, employees, 
agents, and representatives of the foregoing. The terms ``parent,'' 
``subsidiary,'' ``affiliate,'' and ``joint venture'' refer to any 
person in which there is majority (greater than 50 percent) or total 
ownership or control between the company and any other person.
    U. ``Modelo Brand Beer'' means any Beer SKU that is part of the 
Divestiture Assets, and any Beer SKU that may become subject to the 
agreements giving effect to the divestitures required by Sections IV or 
VI of this Final Judgment.
    V. ``Nominal Capacity'' means a brewery's annual production 
capacity for packaged Beer, if the brewery were operated at 100% 
capacity.
    W. ``Piedras Negras Brewery'' means all the land and all existing 
structures, buildings, plants, infrastructure, equipment, fixed assets, 
inventory, tooling, personal property, titles, leases, office 
furniture, materials, supplies, and other tangible property located in 
Nava, Coahuila, Mexico and owned by the Brewery Companies.
    X. ``Sellers'' means ABI and Modelo.
    Y. ``Stock Purchase Agreement'' means the Stock Purchase Agreement 
between Anheuser-Busch InBev SA/NV and Constellation Brands, Inc. dated 
February 13, 2013, as amended on April 19, 2013, and attached hereto in 
Exhibit A.
    Z. ``Sub-License Agreement'' means the Amended and Restated Sub-
License Agreement between Marcas Modelo, S.A. de C.V. and Constellation 
Beers Ltd., attached as Exhibit A to the Stock Purchase Agreement.
    AA. ``Territory'' means the fifty states of the United States of 
America, the District of Columbia, and Guam.
    BB. ``Transaction'' means ABI's proposed acquisition of the 
remainder of Modelo.
    CC. ``Transition Services Agreement'' means:
    1. The form of agreement between ABI and Constellation attached as 
Exhibit B to the Stock Purchase Agreement, and incorporated herein; or
    2. in the event the Divestiture Assets are sold to an Acquirer 
other than Constellation, an agreement between Sellers and such 
Acquirer to provide the same types of services under substantially 
similar terms as provided in Exhibit B to the Stock Purchase Agreement 
incorporated hereto, subject to approval by the United States in its 
sole discretion.

III. Applicability

    A. This Final Judgment applies to Defendants, as defined above, and 
all other persons in active concert or participation with any of them 
who receive actual notice of this Final Judgment by personal service or 
otherwise.
    B. If, prior to complying with Section IV and VI of this Final 
Judgment, Sellers sell or otherwise dispose of all or substantially all 
of their assets or of lesser business units that include the 
Divestiture Assets, they shall require the purchaser to be bound by the 
provisions of this Final Judgment.

[[Page 30418]]

IV. Divestiture

    A. The Court orders the divestitures set forth in this Section IV, 
having accepted the following representations made by the parties as of 
the date of filing this Final Judgment:
    1. By ABI, the certain representations contained in Section 3.25 of 
the Stock Purchase Agreement attached in Exhibit A hereto regarding the 
sufficiency of the assets to be divested;
    2. by ABI, the certain representations contained in Section 3.26 of 
the Stock Purchase Agreement attached in Exhibit A hereto regarding the 
absence of present knowledge of impediments to the expansion of 
capacity of the Piedras Negras Brewery;
    3. by Modelo, the representations set forth in the Letter of Grupo 
Modelo, S.A.B. de C.V., dated April 17, 2013, attached hereto as 
Exhibit C, regarding the issues described in subparagraphs A.1 and A.2 
above; and
    4. by Modelo, the representations set forth in the Letter of Grupo 
Modelo, S.A.B. de C.V., dated April 17, 2013, attached hereto as 
Exhibit C, regarding the sufficiency of the assets being divested for 
the importation, marketing, distribution and sale of Modelo Brand Beer 
in the United States.
    B. ABI is ordered and directed, upon the later of (1) the 
completion of the Transaction or (2) ninety (90) calendar days after 
the filing of this proposed Final Judgment, to divest the Divestiture 
Assets in a manner consistent with this Final Judgment to an Acquirer 
acceptable to the United States in its sole discretion. The United 
States, in its sole discretion, may agree to one or more extensions of 
this time period not to exceed sixty (60) calendar days in total, and 
shall notify the Court in such circumstances. ABI agrees to use its 
best efforts to divest the Divestiture Assets as expeditiously as 
possible.
    C. In the event Sellers are attempting to divest the Divestiture 
Assets to an Acquirer other than Constellation, in accomplishing the 
divestiture ordered by this Final Judgment, Sellers promptly shall make 
known, by usual and customary means, the availability of the 
Divestiture Assets. Sellers shall inform any person making inquiry 
regarding a possible purchase of the Divestiture Assets that they are 
being divested pursuant to this Final Judgment and provide that person 
with a copy of this Final Judgment. Sellers shall offer to furnish to 
all prospective Acquirers, subject to customary confidentiality 
assurances, all information and documents relating to the Divestiture 
Assets customarily provided in a due diligence process except such 
information or documents subject to the attorney-client privileges or 
work-product doctrine. Sellers shall make available such information to 
the United States at the same time that such information is made 
available to any other person.
    D. Sellers shall provide the Acquirer and the United States 
information relating to the personnel involved in the operation of the 
Divestiture Assets to enable the Acquirer to make offers of employment. 
Sellers will not interfere with any negotiations by the Acquirer to 
retain, employ or contract with any employee of the Brewery Companies. 
Interference with respect to this paragraph includes, but is not 
limited to, enforcement of non-compete clauses, solicitation of 
employment with ABI or Modelo, offers to transfer to another facility 
of ABI or Modelo, and offers to increase salary or other benefits apart 
from those offered company-wide.
    E. In the event the Sellers are attempting to divest the 
Divestiture Assets to an Acquirer other than Constellation, Sellers 
shall permit prospective Acquirers of the Divestiture Assets to have 
reasonable access to personnel and to make inspections of the physical 
facilities of the Piedras Negras Brewery; access to any and all 
environmental, zoning, and other permit documents and information; and 
access to any and all financial, operational, or other documents and 
information customarily provided as part of a due diligence process.
    F. Defendants shall, as soon as possible, but within two (2) 
business days after completion of the relevant event, notify the United 
States of: (1) The effective date of the completion of the Transaction; 
and (2) the effective date of the sale of the Divestiture Assets to the 
Acquirer.
    G. Any amendment or modification of any of the agreements in 
Exhibit A, or any similar agreements entered with an Acquirer pursuant 
to Section IV.B, may only be entered into with the approval of the 
United States in its sole discretion. Sellers and the Acquirer shall 
enter into a Transition Services Agreement for a period up to three (3) 
years from the date of the divestiture to enable the Acquirer to 
compete effectively in providing Beer in the United States. Sellers 
shall perform all duties and provide any and all services required of 
Sellers under the Transition Services Agreement. Any amendments or 
modifications of the Transition Services Agreement may only be entered 
into with the approval of the United States in its sole discretion.
    H. Sellers and the Acquirer shall enter into an Interim Supply 
Agreement for a period up to three (3) years from the execution date of 
the divestiture to enable the Acquirer to compete effectively in 
providing Beer in the United States. Sellers shall perform all duties 
and provide any and all services required of Sellers under the Interim 
Supply Agreement. Any amendments, modifications, or extensions of the 
Interim Supply Agreement beyond three (3) years may only be entered 
into with the approval of the United States in its sole discretion.
    I. If the Acquirer seeks an extension of the Interim Supply 
Agreement, the Acquirer shall so notify the United States in writing at 
least four (4) months prior to the date the Interim Supply Agreement 
expires. If the United States approves such an extension, it shall so 
notify the Acquirer in writing at least three (3) months prior to the 
date the Interim Supply Agreement expires. The total term of the 
Interim Supply Agreement and any extension(s) so approved shall not 
exceed five (5) years.
    J. Unless the United States otherwise consents in writing, the 
divestiture pursuant to Section IV or VI shall include the entire 
Divestiture Assets, and shall be accomplished in such a way as to 
satisfy the United States, in its sole discretion, that the Divestiture 
Assets can and will be used by the Acquirer as part of a viable, 
ongoing business, engaged in providing Beer in the United States. The 
divestiture shall be:
    1. made to an Acquirer that, in the United States' sole judgment, 
has the intent and capability (including the necessary managerial, 
operational, technical and financial capability) to complete the 
expansion of the Piedras Negras Brewery as contemplated herein, and to 
compete in the business of providing Beer; and
    2. accomplished so as to satisfy the United States, in its sole 
discretion, that none of the terms of the agreement between an Acquirer 
and Sellers gives Sellers the ability unreasonably to raise the 
Acquirer's costs, to lower the Acquirer's efficiency, or otherwise to 
interfere in the ability of the Acquirer to compete effectively.

V. Required Expansion and Other Provisions Designed To Promote 
Competition

    A. Acquirer shall accomplish the expansion of the Piedras Negras 
Brewery to a Nominal Capacity of at least twenty (20) million 
hectoliters of packaged Beer annually, to include the ability to 
produce commercially reasonable quantities of each Modelo Brand Beer 
offered by Crown for sale in the United States as of the date of filing

[[Page 30419]]

this proposed Final Judgment. Acquirer shall complete the above 
expansion by December 31, 2016. As part of the expansion of the Piedras 
Negras Brewery, Defendant Constellation shall use its best efforts to 
complete the following construction milestones by the specified 
deadlines:
    1. Within six (6) months from the date of divestiture, the 
appointment of, and contracts executed with, design and engineering 
firms;
    2. Within twelve (12) months from the date of divestiture, the 
completion of the design and engineering (including specifications and 
rated capacities) of the brewhouse, packaging hall, and warehouse;
    3. Within twelve (12) months from the date of divestiture, the 
obtainment of all necessary permits;
    4. Within twelve (12) months from the date of divestiture, the 
commencement of construction of the brewhouse, packaging hall, and 
warehouse;
    5. Within twenty-four (24) months from the date of divestiture, the 
completion of the construction of the warehouse and completion of the 
installation of equipment in the warehouse;
    6. Within thirty (30) months from the date of divestiture, the 
completion of the construction of the brewhouse and completion of the 
installation of equipment in the brewhouse;
    7. Within thirty-six (36) months from the date of divestiture, the 
completion of the construction of the packaging hall and the completion 
of the installation of equipment in the packaging hall; and
    8. Within thirty-six (36) months from the date of divestiture, 
Constellation determines in its discretion that it is able to obtain 
its supply requirements from the Piedras Negras Brewery and is no 
longer dependent on supply under the Interim Supply Agreement.
    B. For a period of thirty-six (36) months after the date of the 
divestiture, (i) ABI shall not make any change to its Distributor 
Incentive Program that would cause any Modelo Brand Beer to count 
against a Distributor's level of alignment, nor implement a new 
Distributor Incentive Program that would have a similar effect; and 
(ii) additionally, any Distributor's carrying of Modelo Brand Beer 
shall not be considered by ABI to be an adverse factor or circumstance 
when determining whether or not to approve such Distributor's purchase 
of any other Distributor.
    C. For a period of two (2) years beginning one (1) year after 
filing of this proposed Final Judgment, as to any ABI-Owned Distributor 
that has rights to distribute Modelo Brand Beer in the Territory, the 
Acquirer shall have the right, upon sixty (60) days notice to ABI, to 
direct the ABI-Owned Distributor to sell those rights to another 
Distributor identified by Acquirer, subject to the terms for such sales 
set forth in Exhibit D hereto, and incorporated herein. At least thirty 
(30) days before ABI acquires a majority of the equity interests in any 
additional Distributors after divestiture of the Divestiture Assets, 
and such Distributors have rights to distribute Modelo Brand Beer in 
the Territory, ABI shall notify the Acquirer of any such planned 
acquisition and the Acquirer shall have thirty (30) days from the date 
of such notice to provide notice to ABI that the Acquirer intends to 
exercise the rights outlined in Exhibit D hereto.
    D. If Sellers and the Acquirer enter into any new agreement(s) with 
each other with respect to the brewing, packaging, production, 
marketing, importing, distribution, or sale of Beer in the United 
States or elsewhere, Sellers and the Acquirer shall notify the United 
States of the new agreement(s) at least sixty (60) calendar days in 
advance of such agreement(s) becoming effective and such agreement(s) 
may only be entered into with the approval of the United States in its 
sole discretion.

VI. Appointment of Trustee To Effect Divestiture

    A. If Sellers have not divested the Divestiture Assets within the 
time period specified in Section IV.B, Sellers shall notify the United 
States of that fact in writing. Upon application of the United States, 
the Court shall appoint a Divestiture Trustee selected by the United 
States and approved by the Court to divest the Divestiture Assets in a 
manner consistent with this Final Judgment.
    B. After the appointment of a Divestiture Trustee becomes 
effective, only the Divestiture Trustee shall have the right to sell 
the Divestiture Assets. The Divestiture Trustee shall have the power 
and authority to accomplish the divestiture to an Acquirer acceptable 
to the United States at such price and on such terms as are then 
obtainable upon reasonable effort by the Divestiture Trustee, subject 
to the provisions of Sections IV, V, VI, and VII of this Final 
Judgment, and shall have such other powers as this Court deems 
appropriate.
    C. Subject to Section VI.E of this Final Judgment, the Divestiture 
Trustee may hire at the cost and expense of Sellers any investment 
bankers, attorneys, or other agents, who shall be solely accountable to 
the Divestiture Trustee, reasonably necessary in the Divestiture 
Trustee's judgment to assist in the divestiture.
    D. Defendants shall not object to a sale by the Divestiture Trustee 
on any ground other than the Divestiture Trustee's malfeasance. Any 
such objections by Defendants must be conveyed in writing to the United 
States and the Divestiture Trustee within ten (10) calendar days after 
the Divestiture Trustee has provided the notice required under Section 
VII.A.
    E. The Divestiture Trustee shall serve at the cost and expense of 
Sellers, pursuant to a written agreement with Sellers on such terms and 
conditions as the United States approves, and shall account for all 
monies derived from the sale of the assets sold by the Divestiture 
Trustee and all costs and expenses so incurred. After approval by the 
Court of the Divestiture Trustee's accounting, including fees for its 
services and those of any professionals and agents retained by the 
Divestiture Trustee, all remaining money shall be paid to Sellers and 
the trust shall then be terminated. The compensation of the Divestiture 
Trustee and any professionals and agents retained by the Divestiture 
Trustee shall be reasonable in light of the value of the Divestiture 
Assets and based on a fee arrangement providing the Divestiture Trustee 
with an incentive based on the price and terms of the divestiture and 
the speed with which it is accomplished, but timeliness is paramount.
    F. Defendants shall use their best efforts to assist the 
Divestiture Trustee in accomplishing the required divestiture. The 
Divestiture Trustee and any consultants, accountants, attorneys, and 
other persons retained by the Divestiture Trustee shall have full and 
complete access to the personnel, books, records, and facilities of the 
business to be divested, and Defendants shall develop financial and 
other information relevant to such business as the Divestiture Trustee 
may reasonably request, subject to reasonable protection for trade 
secret or other confidential research, development, or commercial 
information. Defendants shall take no action to interfere with or to 
impede the Divestiture Trustee's accomplishment of the divestiture.
    G. After its appointment, the Divestiture Trustee shall file 
monthly reports with the United States and the Court setting forth the 
Divestiture Trustee's efforts to accomplish the divestiture ordered 
under this Final Judgment. To the extent such reports contain 
information that the Divestiture Trustee deems confidential, such 
reports shall not be filed in the public docket of the Court. Such 
reports shall include the name, address, and telephone number of each 
person who,

[[Page 30420]]

during the preceding month, made an offer to acquire, expressed an 
interest in acquiring, entered into negotiations to acquire, or was 
contacted or made an inquiry about acquiring the Divestiture Assets, 
and shall describe in detail each contact with any such person. The 
Divestiture Trustee shall maintain full records of all efforts made to 
divest the Divestiture Assets.
    H. If the Divestiture Trustee has not accomplished the divestiture 
ordered under this Final Judgment within six (6) months after its 
appointment, the Divestiture Trustee shall promptly file with the Court 
a report setting forth (1) the Divestiture Trustee's efforts to 
accomplish the required divestiture, (2) the reasons, in the 
Divestiture Trustee's judgment, why the required divestiture has not 
been accomplished, and (3) the Divestiture Trustee's recommendations. 
To the extent such reports contain information that the Divestiture 
Trustee deems confidential, such reports shall not be filed in the 
public docket of the Court. The Divestiture Trustee shall at the same 
time furnish such report to the Defendants and to the United States, 
which shall have the right to make additional recommendations 
consistent with the purpose of the trust. The Court thereafter shall 
enter such orders as it shall deem appropriate to carry out the purpose 
of the Final Judgment, which may, if necessary, include extending the 
trust and the term of the Divestiture Trustee's appointment by a period 
requested by the United States.

VII. Notice of Proposed Divestiture

    A. Within two (2) business days following execution of a definitive 
divestiture agreement with an Acquirer other than Constellation, the 
Defendants or the Divestiture Trustee, whichever is then responsible 
for effecting the divestiture required herein, shall notify the United 
States of any proposed divestiture required by Section IV of this Final 
Judgment. If the Divestiture Trustee is responsible, it shall similarly 
notify Defendants. The notice shall set forth the details of the 
proposed divestiture and list the name, address, and telephone number 
of each person who offered or expressed an interest in or desire to 
acquire any ownership interest in the Divestiture Assets or, in the 
case of the Divestiture Trustee, any update of the information required 
to be provided under Section VI.G above.
    B. Within fifteen (15) calendar days of receipt by the United 
States of such notice, the United States may request from Defendants, 
the proposed Acquirer, any other third party, or the Divestiture 
Trustee if applicable, additional information concerning the proposed 
divestiture, the proposed Acquirer, and any other potential Acquirer. 
Defendants and the Divestiture Trustee shall furnish any additional 
information requested within fifteen (15) calendar days of the receipt 
of the request, unless the parties shall otherwise agree.
    C. Within thirty (30) calendar days after receipt of the notice or 
within twenty (20) calendar days after the United States has been 
provided the additional information requested from Defendants, the 
proposed Acquirer, any third party, and the Divestiture Trustee, 
whichever is later, the United States shall provide written notice to 
Defendants and the Divestiture Trustee, stating whether or not it 
objects to the proposed divestiture. If the United States provides 
written notice that it does not object, the divestiture may be 
consummated, subject only to Defendants' limited right to object to the 
sale under Section VI.D of this Final Judgment. Absent written notice 
that the United States does not object to the proposed Acquirer or upon 
objection by the United States, a divestiture proposed under Section VI 
shall not be consummated. Upon objection by Defendants under Section 
VI.D, a divestiture proposed under Section VI shall not be consummated 
unless approved by the Court.

VIII. Monitoring Trustee

    A. Upon the filing of this Final Judgment, the United States may, 
in its sole discretion, appoint a Monitoring Trustee, subject to 
approval by the Court.
    B. The Monitoring Trustee shall have the power and authority to 
monitor Defendants' compliance with the terms of this Final Judgment 
and the Hold Separate Stipulation and Order entered by this Court, and 
shall have such powers as this Court deems appropriate. The Monitoring 
Trustee shall be required to investigate and report on the Defendants' 
compliance with this Final Judgment and the Defendants' progress toward 
effectuating the purposes of this Final Judgment, including but not 
limited to:
    1. The attainment of the construction milestones by the Acquirer as 
set forth in Section V.A, the reasons for any failure to meet such 
milestones, and recommended remedies for any such failure;
    2. any breach or other problem that arises under the Transition 
Services Agreement, Interim Supply Agreement, or other agreement 
between Sellers and Acquirer that may affect the accomplishment of the 
purposes of this Final Judgment, the reasons for such breach or 
problem, and recommended remedies therefor; and
    3. any breach or other concern regarding the accuracy of the 
representations made by ABI in sections 3.25 and 3.26 of the Stock 
Purchase Agreement, incorporated herein, or successor agreements 
thereto, and by Modelo in the Letter of Grupo Modelo, S.A.B. de C.V., 
incorporated herein as Exhibit C, and recommended remedies therefor.
    C. Subject to Section VIII.E of this Final Judgment, the Monitoring 
Trustee may hire at the cost and expense of ABI, any consultants, 
accountants, attorneys, or other persons, who shall be solely 
accountable to the Monitoring Trustee, reasonably necessary in the 
Monitoring Trustee's judgment.
    D. Defendants shall not object to actions taken by the Monitoring 
Trustee in fulfillment of the Monitoring Trustee's responsibilities 
under any Order of this Court on any ground other than the Monitoring 
Trustee's malfeasance. Any such objections by Defendants must be 
conveyed in writing to the United States and the Monitoring Trustee 
within ten (10) calendar days after the action taken by the Monitoring 
Trustee giving rise to the Defendants' objection.
    E. The Monitoring Trustee shall serve at the cost and expense of 
ABI on such terms and conditions as the United States approves. The 
compensation of the Monitoring Trustee and any consultants, 
accountants, attorneys, and other persons retained by the Monitoring 
Trustee shall be on reasonable and customary terms commensurate with 
the individuals' experience and responsibilities. The Monitoring 
Trustee shall, within three (3) business days of hiring any 
consultants, accountants, attorneys, or other persons, provide written 
notice of such hiring and the rate of compensation to ABI.
    F. The Monitoring Trustee shall have no responsibility or 
obligation for the operation of Defendants' businesses.
    G. Defendants shall use their best efforts to assist the Monitoring 
Trustee in monitoring Defendants' compliance with their individual 
obligations under this Final Judgment and under the Hold Separate 
Stipulation and Order. The Monitoring Trustee and any consultants, 
accountants, attorneys, and other persons retained by the Monitoring 
Trustee shall have full and complete access to the personnel, books, 
records, and facilities relating to compliance with this Final 
Judgment, subject to reasonable protection for trade secret or other 
confidential research, development, or commercial

[[Page 30421]]

information or any applicable privileges. Defendants shall take no 
action to interfere with or to impede the Monitoring Trustee's 
accomplishment of its responsibilities.
    H. After its appointment, the Monitoring Trustee shall file reports 
every ninety (90) days, or more frequently as needed, with the United 
States, the Defendants and the Court setting forth the Defendants' 
efforts to comply with their individual obligations under this Final 
Judgment and under the Hold Separate Stipulation and Order. To the 
extent such reports contain information that the trustee deems 
confidential, such reports shall not be filed in the public docket of 
the Court.
    I. The Monitoring Trustee shall serve until the divestiture of all 
the Divestiture Assets is finalized pursuant to either Section IV or 
Section VI of this Final Judgment and the Transition Services Agreement 
and the Interim Supply Agreement have expired and all other relief has 
been completed as defined in Section V.A.

IX. Financing

    Sellers shall not finance all or any part of any purchase made 
pursuant to Section IV or VI of this Final Judgment.

X. Hold Separate

    Until the divestiture required by this Final Judgment has been 
accomplished, Defendants shall take all steps necessary to comply with 
the Hold Separate Stipulation and Order entered by this Court. 
Defendants shall take no action that would jeopardize the divestiture 
ordered by this Court.

XI. Affidavits

    A. Within twenty (20) calendar days of the filing of this proposed 
Final Judgment, and every thirty (30) calendar days thereafter until 
the divestiture has been completed under Section IV or VI, each Seller 
shall deliver to the United States an affidavit as to the fact and 
manner of its compliance with Section IV or VI of this Final Judgment. 
Each such affidavit shall include the name, address, and telephone 
number of each person who, during the preceding thirty (30) calendar 
days, made an offer to acquire, expressed an interest in acquiring, 
entered into negotiations to acquire, or was contacted or made an 
inquiry about acquiring, any interest in the Divestiture Assets, and 
shall describe in detail each contact with any such person during that 
period. Each such affidavit shall also include a description of the 
efforts Sellers have taken to solicit buyers for the Divestiture 
Assets, and to provide required information to prospective Acquirers, 
including the limitations, if any, on such information. Assuming the 
information set forth in the affidavit is true and complete, any 
objection by the United States to information provided by Sellers, 
including limitation on information, shall be made within fourteen (14) 
calendar days of receipt of such affidavit.
    B. Within twenty (20) calendar days of the filing of this proposed 
Final Judgment, each Defendant shall deliver to the United States an 
affidavit that describes in reasonable detail all actions it has taken 
and all steps it has implemented on an ongoing basis to comply with 
Section X of this Final Judgment. Each Defendant shall deliver to the 
United States an affidavit describing any changes to the efforts and 
actions outlined in its earlier affidavits filed pursuant to this 
section within fifteen (15) calendar days after the change is 
implemented.
    C. Defendants shall keep all records of all efforts made to 
preserve and divest the Divestiture Assets until one year after such 
divestiture has been completed.

XII. Notification of Future Transactions

    A. Unless such transaction is otherwise subject to the reporting 
and waiting period requirements of the Hart-Scott-Rodino Antitrust 
Improvements Act of 1976, as amended, 15 U.S.C. 18a (the ``HSR Act''), 
ABI, without providing at least sixty (60) calendar days advance 
notification to the United States, shall not directly or indirectly 
acquire or license a Covered Interest in or from a Covered Entity; 
provided, however, that advance notification shall not be required for 
acquisitions of the type addressed in 16 CFR 802.1 and 802.9.
    B. Any notification pursuant to Section XII.A above shall be 
provided to the United States in letter format, and shall identify the 
parties to the transaction, the assets being acquired or licensed, the 
value of the transaction, the seller's annual gross revenue from each 
brand or asset being acquired, and the identity of the current importer 
for any Beer being acquired that is brewed outside the United States.
    C. All references to the HSR Act in this Final Judgment refer to 
the HSR Act as it exists at the time of the transaction or agreement 
and incorporate any subsequent amendments to the Act.

XIII. Firewall

    A. During the term of the Transition Services Agreement and the 
Interim Supply Agreement, Sellers shall implement and maintain 
reasonable procedures to prevent Acquirer Confidential Information from 
being disclosed by or through Sellers to those of Sellers' affiliates 
who are involved in the marketing, distribution, or sale of Beer in the 
United States, or to any other person who does not have a need to know 
the information.
    B. Sellers shall, within ten (10) business days of the entry of the 
Hold Separate Stipulation and Order, submit to the United States a 
document setting forth in detail the procedures implemented to effect 
compliance with Section XIII.A of this Final Judgment. The United 
States shall notify Sellers within five (5) business days whether it 
approves of or rejects Sellers' compliance plan, in its sole 
discretion. In the event that Sellers' compliance plan is rejected, the 
reasons for the rejection shall be provided to Sellers and Sellers 
shall be given the opportunity to submit, within ten (10) business days 
of receiving the notice of rejection, a revised compliance plan. If the 
parties cannot agree on a compliance plan, the United States shall have 
the right to request that the Court rule on whether Sellers' proposed 
compliance plan is reasonable.
    C. Defendants may at any time submit to the United States evidence 
relating to the actual operation of the firewall in support of a 
request to modify the firewall set forth in this Section XIII. In 
determining whether it would be appropriate for the United States to 
consent to modify the firewall, the United States, in its sole 
discretion, shall consider the need to protect Acquirer Confidential 
Information and the impact the firewall has had on Sellers' ability to 
efficiently provide services, supplies and products under the 
Transition Services Agreement and the Interim Supply Agreement.
    D. Sellers and the Acquirer shall:
    1. furnish a copy of this Final Judgment and related Competitive 
Impact Statement within sixty (60) days of entry of the Final Judgment 
to (a) each officer, director, and any other employee that will receive 
Acquirer Confidential Information; (b) each officer, director, and any 
other employee that is involved in (i) any contact with the other 
companies that are parties to the Transition Services Agreement and 
Interim Supply Agreement, (ii) making decisions under the Transition 
Services Agreement or the Interim Supply Agreement, (iii) making 
decisions regarding ABI's Distributor Incentive Programs, or (iv) 
making decisions regarding the treatment of Crown by either ABI-Owned 
Distributors, or by any other Distributor in which ABI acquires a

[[Page 30422]]

majority interest after the date of the divestiture contemplated 
herein; and (c) any successor to a person designated in Section 
XIII.D.1(a) or (b);
    2. annually brief each person designated in Section XIII.D.1 on the 
meaning and requirements of this Final Judgment and the antitrust laws; 
and
    3. obtain from each person designated in Section XIII.D.1, within 
sixty (60) days of that person's receipt of the Final Judgment, a 
certification that he or she (i) has read and, to the best of his or 
her ability, understands and agrees to abide by the terms of this Final 
Judgment; (ii) is not aware of any violation of the Final Judgment that 
has not been reported to the company; and (iii) understands that any 
person's failure to comply with this Final Judgment may result in an 
enforcement action for civil or criminal contempt of court against each 
Defendant and/or any person who violates this Final Judgment.

XIV. Compliance Inspection

    A. For the purposes of determining or securing compliance with this 
Final Judgment, or of determining whether the Final Judgment should be 
modified or vacated, and subject to any legally recognized privilege, 
from time to time authorized representatives of the United States 
Department of Justice Antitrust Division (``Antitrust Division''), 
including consultants and other persons retained by the United States, 
shall, upon written request of an authorized representative of the 
Assistant Attorney General in charge of the Antitrust Division, and on 
reasonable notice to Defendants, be permitted:
    1. Access during Defendants' office hours to inspect and copy, or 
at the option of the United States, to require Defendants to provide 
hard copy or electronic copies of, all books, ledgers, accounts, 
records, data, and documents in the possession, custody, or control of 
Defendants, relating to any matters contained in this Final Judgment; 
and
    2. to interview, either informally or on the record, Defendants' 
officers, employees, or agents, who may have their individual counsel 
present, regarding such matters. The interviews shall be subject to the 
reasonable convenience of the interviewee and without restraint or 
interference by Defendants.
    B. Upon the written request of an authorized representative of the 
Assistant Attorney General in charge of the Antitrust Division, 
Defendants shall submit written reports or respond to written 
interrogatories, under oath if requested, relating to any of the 
matters contained in this Final Judgment as may be requested. Written 
reports authorized under this paragraph may, at the sole discretion of 
the United States, require Defendants to conduct, at Defendants' cost, 
an independent audit or analysis relating to any of the matters 
contained in this Final Judgment.
    C. No information or documents obtained by the means provided in 
this section shall be divulged by the United States to any person other 
than an authorized representative of the executive branch of the United 
States, except in the course of legal proceedings to which the United 
States is a party (including grand jury proceedings), or for the 
purpose of securing compliance with this Final Judgment, or as 
otherwise required by law.
    D. If at the time information or documents are furnished by 
Defendants to the United States, Defendants represent and identify in 
writing the material in any such information or documents to which a 
claim of protection may be asserted under the Protective Order, then 
the United States shall give Defendants ten (10) calendar days notice 
prior to divulging such material in any legal proceeding (other than a 
grand jury proceeding).

XV. No Reacquisition

    Sellers may not reacquire any part of the Divestiture Assets during 
the term of this Final Judgment.

XVI. Bankruptcy

    The failure of any party to the Sub-License Agreement to perform 
any remaining obligations of such party under the Sub-License Agreement 
shall not excuse performance by the other party of its obligations 
thereunder. Accordingly, for purposes of Section 365(n) of the 
Bankruptcy Reform Act of 1978, as amended, and codified as 11 U.S.C. 
101 et seq. (the ``Bankruptcy Code'') or any analogous provision under 
any law of any foreign or domestic, federal, state, provincial, local, 
municipal or other governmental jurisdiction relating to bankruptcy, 
insolvency or reorganization (``Foreign Bankruptcy Law''), (a) the Sub-
License Agreement will not be deemed to be an executory contract, and 
(b) if for any reason the Sub-License Agreement is deemed to be an 
executory contract, the licenses granted under the Sub-License 
Agreement shall be deemed to be licenses to rights in ``intellectual 
property'' as defined in Section 101 of the Bankruptcy Code or any 
analogous provision of Foreign Bankruptcy Law and Constellation or any 
other Acquirer shall be protected in the continued enjoyment of its 
right under the Sub-License Agreement including, without limitation, if 
Constellation or another Acquirer so elects, the protection conferred 
upon licensees under 11 U.S.C. Section 365(n) of the Bankruptcy Code or 
any analogous provision of Foreign Bankruptcy Law.

XVII. Retention of Jurisdiction

    This Court retains jurisdiction to enable any party to this Final 
Judgment to apply to this Court at any time for further orders and 
directions as may be necessary or appropriate to carry out or construe 
this Final Judgment, to modify any of its provisions, to ensure and 
enforce compliance, and to punish violations of its provisions.

XVIII. Expiration of Final Judgment

    Unless this Court grants an extension, this Final Judgment shall 
expire ten (10) years from the date of its entry.

XIX. Public Interest Determination

    Entry of this Final Judgment is in the public interest. The parties 
have complied with the requirements of the Antitrust Procedures and 
Penalties Act, 15 U.S.C. 16, including making copies available to the 
public of this Final Judgment, the Competitive Impact Statement, and 
any comments thereon and the United States' responses to comments. 
Based upon the record before the Court, which includes the Competitive 
Impact Statement and any comments and response to comments filed with 
the Court, entry of this Final Judgment is in the public interest.
Dated:-----------------------------------------------------------------

    Court approval subject to procedures of the Antitrust Procedures 
and Penalties Act, 15 U.S.C. 16.
-----------------------------------------------------------------------

United States District Judge


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Exhibit D

[REDACTED]

[FR Doc. 2013-11832 Filed 5-21-13; 8:45 am]
BILLING CODE 4410-11-P