UNITED STATES SECURITIES and EXCHANGE COMMISSION Washington, D
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UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D. C. 20549 ___________ FORM 8-K CURRENT REPORT Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 Date of Report (Date of earliest event reported) October 31, 2016 Commission file number 1-13163 ________________________ YUM! BRANDS, INC. (Exact name of registrant as specified in its charter) North Carolina 13-3951308 (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification No.) 1441 Gardiner Lane, Louisville, Kentucky 40213 (Address of principal executive offices) (Zip Code) Registrant’s telephone number, including area code: (502) 874-8300 Former name or former address, if changed since last report: N/A Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions: [ ] Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) [ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) [ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) [ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) Item 1.01 Entry Into a Material Definitive Agreement On October 31, 2016, Yum! Brands, Inc. (“ YUM ”) distributed all of the outstanding shares of common stock of Yum China Holdings, Inc. (“ Yum China ”) to YUM shareholders (the “ Distribution ”). In connection with the Distribution, YUM (or a subsidiary of YUM) entered into several agreements with Yum China (or a subsidiary of Yum China) that govern the relationship of the parties following the Distribution, including the following: • Separation and Distribution Agreement • Master License Agreement • Tax Matters Agreement Summaries of the material terms of these agreements can be found in the section entitled “Certain Relationships and Related Person Transactions” in the Information Statement filed as Exhibit 99.1 to Yum China’s Current Report on Form 8-K filed with the Securities and Exchange Commission on November 1, 2016 which summary is incorporated herein by reference. The descriptions of those agreements are qualified in their entirety by reference to the complete terms and conditions of those agreements, which are attached hereto as Exhibits 2.1, 10.1 and 10.2, respectively. Item 2.01 Completion of Acquisition or Disposition of Assets On October 31, 2016, YUM completed the Distribution. Yum China was formed to hold YUM’s China business and, as a result of the Distribution, Yum China is now an independent public company trading under the symbol “YUMC” on the New York Stock Exchange. The Distribution was made to YUM shareholders of record as of the close of business on October 19, 2016 (the “ Record Date ”). Each YUM shareholder of record on the Record Date received one share of Yum China common stock for each share of YUM common stock held on the Record Date. In the aggregate, 363,758,219 shares of Yum China common stock were distributed to YUM’s shareholders in the Distribution. On November 1, 2016, YUM issued a press release announcing the completion of the Distribution. A copy of the press release is attached hereto as Exhibit 99.1. Item 9.01 Financial Statements and Exhibits (b) Pro forma financial information . The unaudited pro forma consolidated financial statements of YUM giving effect to the Distribution, and the related notes thereto, are attached hereto as Exhibit 99.2. (d) Exhibits . The following exhibits are provided as part of this Current Report on Form 8-K: Exhibit No. Exhibit 2.1* Separation and Distribution Agreement, dated as of October 31, 2016, by and among Yum! Brands, Inc, Yum Restaurants Consulting (Shanghai) Company Limited and Yum China Holdings, Inc. 10.1 Master License Agreement, dated as of October 31, 2016, by and between Yum! Restaurants Asia Pte. Ltd. and Yum Restaurants Consulting (Shanghai) Company Limited. 10.2 Tax Matters Agreement, dated as of October 31, 2016, by and among Yum! Brands, Inc., Yum China Holdings, Inc. and Yum Restaurants Consulting (Shanghai) Company Limited. 99.1 Press Release of Yum! Brands, Inc., dated November 1, 2016. 99.2 Yum! Brands, Inc. Unaudited Pro Forma Consolidated Financial Statements. *Certain schedules and exhibits to this agreement have been omitted in accordance with Item 601(b)(2) of Regulation S-K. A copy of any omitted schedules and/or exhibits will be furnished to the Securities and Exchange Commission upon request. SIGNATURE Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. YUM! BRANDS, INC. (Registrant) Date: November 3, 2016 /s/ David E. Russell Vice President, Finance and Corporate Controller (Principal Accounting Officer) Exhibit 2.1 SEPARATION AND DISTRIBUTION AGREEMENT BY AND BETWEEN YUM! BRANDS, INC., YUM RESTAURANTS CONSULTING (SHANGHAI) COMPANY LIMITED AND YUM CHINA HOLDING S, INC. DATED AS OF OCTOBER 31, 2016 TABLE OF CONTENTS Page ARTICLE I DEFINITIONS 2 ARTICLE II THE SEPARATION 13 2.1 Transfer of Assets and Assumption of Liabilities 13 2.2 SpinCo Assets; YUM Assets 15 2.3 SpinCo Liabilities; YUM Liabilities 17 2.4 Approvals and Notifications 19 2.5 Novation of Liabilities 22 2.6 Release of Guarantees 23 2.7 Termination of Agreements 24 2.8 Treatment of Shared Contracts 25 2.9 Bank Accounts; Cash Balances 26 2.10 Ancillary Agreements 27 2.11 Disclaimer of Representations and Warranties 27 2.12 Financial Information Certifications 28 2.13 Transition Committee 28 ARTICLE III THE DISTRIBUTION 29 3.1 Sole and Absolute Discretion; Cooperation 29 3.2 Actions Prior to the Distribution 29 3.3 Conditions to the Distribution 30 3.4 The Distribution 32 ARTICLE IV MUTUAL RELEASES, INDEMNIFICATION AND LITIGATION 33 4.1 Release of Pre-Distribution Claims 33 4.2 Indemnification by the SpinCo Parties 35 4.3 Indemnification by YUM 36 4.4 Indemnification Obligations Net of Insurance Proceeds and Other Amounts 37 4.5 Procedures for Indemnification of Third-Party Claims 38 4.6 Additional Matters 40 4.7 Right of Contribution 41 4.8 Covenant Not to Sue 41 4.9 Remedies Cumulative 42 4.10 Survival of Indemnities 42 4.11 Coordination with Ancillary Agreements 42 4.12 Management of Certain Actions 42 4.13 Settlement of Actions 44 ARTICLE V CERTAIN OTHER MATTERS 44 5.1 Insurance Matters 44 5.2 Late Payments 46 5.3 Treatment of Payments for Tax Purposes 47 5.4 Non-Solicitation 47 i 5.5 Inducement 47 5.6 Post-Effective Time Conduct 47 ARTICLE VI EXCHANGE OF INFORMATION; CONFIDENTIALITY 48 6.1 Agreement for Exchange of Information 48 6.2 Ownership of Information 49 6.3 Compensation for Providing Information 49 6.4 Record Retention 49 6.5 Limitations of Liability 49 6.6 Other Agreements Providing for Exchange of Information 49 6.7 Production of Witnesses; Records; Cooperation 50 6.8 Privileged Matters 51 6.9 Confidentiality 53 6.10 Protective Arrangements 54 ARTICLE VII DISPUTE RESOLUTION 55 7.1 Good-Faith Negotiation 55 7.2 Mandatory Mediation 55 7.3 Confidential Arbitration 56 7.4 Confidentiality 57 7.5 Conduct and Tolling During Dispute Resolution Process 58 7.6 Limitations Period 58 7.7 Enforcement Costs 58 7.8 Litigation and Unilateral Commencement of Arbitration 58 ARTICLE VIII FURTHER ASSURANCES AND ADDITIONAL COVENANTS 58 8.1 Further Assurances 58 ARTICLE IX TERMINATION 59 9.1 Termination 59 9.2 Effect of Termination 59 ARTICLE X MISCELLANEOUS 59 10.1 Counterparts; Entire Agreement; Corporate Power; Facsimile Signatures 59 10.2 Governing Law 60 10.3 Binding Effect; Assignability 60 10.4 No Third-Party Beneficiaries 60 10.5 Notices 61 10.6 Severability 62 10.7 Force Majeure 62 10.8 No Set-Off 62 10.9 Expenses 63 10.10 Headings 63 10.11 Survival of Covenants 63 10.12 Waivers of Default; Remedies Cumulative 63 10.13 Specific Performance 63 10.14 Amendments 63 ii 10.15 Interpretation 63 10.16 Limitations of Liability 64 10.17 Performance 64 10.18 Mutual Drafting 64 iii SCHEDULES Schedule 1.1 SpinCo Discontinued or Divested Businesses Schedule 1.2 SpinCo Contracts Schedule 1.3(a) SpinCo Registrable IP Schedule 1.3(c) SpinCo Other IP Schedule 1.4(a) SpinCo Real Property (Owned) Schedule 1.4(b) SpinCo Real Property Leases Schedule 1.5 SpinCo Software Schedule 1.6 SpinCo Technology Schedule 1.7 YUM Software Schedule 1.8 YUM Technology Schedule 1.9 Transferred Entities Schedule 1.10 SpinCo Specified Actions Schedule 1.11 YUM Specified Actions Schedule 2.1(a) Plan of Reorganization Schedule 2.2(a)(xi) SpinCo Assets Schedule 2.2(b)(iii) YUM Intellectual Property Schedule 2.2(b)(vi) YUM Assets (Other) Schedule 2.3(a)(vi) SpinCo Liabilities (Other) Schedule 2.3(b)(iv) YUM Liabilities (Other) Schedule 2.5(a) Novation of SpinCo Liabilities Schedule 2.7(b)(ii) Intercompany Agreements Schedule 4.3(f) Specified YUM Information Schedule 4.12(c) Mixed Actions Schedule 10.9 Allocation of Certain Costs and Expenses EXHIBITS Exhibit A Form of Amended and Restated Certificate of Incorporation of Yum China Holding s, Inc. Exhibit B Form of Amended and Restated Bylaws of Yum China Holding s, Inc. iv SEPARATION AND DISTRIBUTION AGREEMENT This SEPARATION AND DISTRIBUTION AGREEMENT (this “ Agreement ”), dated as of October 31, 2016, is by and among Yum! Brands, Inc., a North Carolina corporation (“ YUM ”), Yum Restaurants Consulting (Shanghai) Company Limited (“ YCCL ”), a company organized under the Laws of the People’s Republic of China, and Yum China Holding s, Inc., a Delaware corporation (“ SpinCo ”, and, together with YCCL, the “ SpinCo Parties ”).