Exhihit 2.10
WLR FOODS, INC.
Dated as of February 25, 1998
Note Purchase Agreement
$42,040,162.73 Variable Rate Senior Notes Due December 31, 1999
177,980 Warrants to Acquire Common Stock
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TABLE OF CONTENTS
PAGE
1. BACKGROUND . . . . . . . . . . . . . . . . . . . . . . . 1
2. AUTHORIZATION OF NOTES . . . . . . . . . . . . . . . . . 2
3. EXCHANGE OF EXISTING NOTES . . . . . . . . . . . . . . . 2
3.1 The Closing . . . . . . . . . . . . . . . . . . 2
4. CONDITIONS TO CLOSING . . . . . . . . . . . . . . . . . . 4
4.1 Representations and Warranties . . . . . . . . 4
4.2 Performance; No Default . . . . . . . . . . . . 4
4.3 Compliance Certificates . . . . . . . . . . . . 4
4.4 Opinions of Counsel . . . . . . . . . . . . . . 4
4.5 Exchange Permitted By Applicable Law, etc . . . 5
4.6 Exchange of Notes and Issuance of Warrants . . 5
4.7 Payment of Fees and Expenses . . . . . . . . . 5
4.8 Private Placement Number . . . . . . . . . . . 5
4.9 Changes in Corporate Structure . . . . . . . . 5
4.10 Payment of Fees . . . . . . . . . . . . . . . . 5
4.11 Subsidiary Guarantees . . . . . . . . . . . . . 6
4.12 Payment of Interest on Existing Notes . . . . . 6
4.13 Security Documents . . . . . . . . . . . . . . 6
4.14 Perfection of Liens . . . . . . . . . . . . . . 6
4.15 Bank Credit Agreements . . . . . . . . . . . . 6
4.16 Warrantholders Rights Agreement . . . . . . . . 7
4.17 Proceedings and Documents . . . . . . . . . . . 7
5. REPRESENTATIONS AND WARRANTIES OF THE COMPANY . . . . . . 7
5.1 Organization; Power and Authority . . . . . . . 7
5.2 Authorization, etc . . . . . . . . . . . . . . 7
5.3 Disclosure . . . . . . . . . . . . . . . . . . 8
5.4 Organization and Ownership of Shares of
Subsidiaries; Affiliates . . . . . . . . . . . 8
5.5 Financial Statements . . . . . . . . . . . . . 9
5.6 Compliance with Laws, Other Instruments, etc . 9
5.7 Governmental Authorizations, etc . . . . . . . 9
5.8 Litigation; Observance of Agreements, Statutes
and Orders . . . . . . . . . . . . . . . . . . 10
5.9 Taxes . . . . . . . . . . . . . . . . . . . . . 10
5.10 Title to Property; Leases . . . . . . . . . . . 10
5.11 Licenses, Permits, etc . . . . . . . . . . . . 11
5.12 Compliance with ERISA . . . . . . . . . . . . . 11
5.13 Private Offering by the Company . . . . . . . . 12
5.14 Use of Proceeds; Margin Regulations . . . . . . 12
5.15 Existing Indebtedness; Future Liens . . . . . . 13
5.16 Foreign Assets Control Regulations, etc . . . . 13
5.17 Status under Certain Statutes . . . . . . . . . 13
5.18 Environmental Matters . . . . . . . . . . . . . 13
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5.19 No Defaults . . . . . . . . . . . . . . . . . . 14
5.20 Company and Subsidiary Guarantors . . . . . . . 14
5.21 Solvency . . . . . . . . . . . . . . . . . . . 14
5.22 Inactive Subsidiaries . . . . . . . . . . . . . 15
5.23 WLR Common Stock . . . . . . . . . . . . . . . 15
6. REPRESENTATIONS OF THE PURCHASER . . . . . . . . . . . . 15
6.1 Acquisition for Investment . . . . . . . . . . 15
6.2 Source of Funds . . . . . . . . . . . . . . . . 15
7. INFORMATION AS TO COMPANY . . . . . . . . . . . . . . . . 17
7.1 Financial and Business Information . . . . . . 17
7.2 Officer's Certificate . . . . . . . . . . . . . 20
7.3 Inspection . . . . . . . . . . . . . . . . . . 20
8. PAYMENT OF THE NOTES . . . . . . . . . . . . . . . . . . 20
8.1 Required Prepayments; Payment at Maturity;
Extension of Maturity . . . . . . . . . . . . . 20
8.2 Optional Prepayments . . . . . . . . . . . . . 22
8.3 Allocation of Partial Prepayments . . . . . . . 22
8.4 Maturity; Surrender, etc . . . . . . . . . . . 23
8.5 No Other Optional Prepayments or Purchase of
Notes . . . . . . . . . . . . . . . . . . . . . 23
8.6 Interest on Notes . . . . . . . . . . . . . . . 23
9. AFFIRMATIVE COVENANTS . . . . . . . . . . . . . . . . . . 24
9.1 Compliance with Law . . . . . . . . . . . . . . 24
9.2 Insurance . . . . . . . . . . . . . . . . . . . 25
9.3 Maintenance of Properties . . . . . . . . . . . 25
9.4 Payment of Taxes and Claims . . . . . . . . . . 25
9.5 Corporate Existence, etc . . . . . . . . . . . 25
9.6 Subsidiaries as Guarantors . . . . . . . . . . 26
9.7 Current Public Information . . . . . . . . . . 26
10. NEGATIVE AND FINANCIAL COVENANTS . . . . . . . . . . . . 26
10.1 Negative Covenants . . . . . . . . . . . . . . 26
10.2 Financial Covenants . . . . . . . . . . . . . . 27
10.3 Transactions with Affiliates . . . . . . . . . 27
10.4 Inactive Subsidiaries . . . . . . . . . . . . . 27
11. EVENTS OF DEFAULT . . . . . . . . . . . . . . . . . . . . 27
12. REMEDIES ON DEFAULT, ETC . . . . . . . . . . . 30
12.1 Acceleration . . . . . . . . . . . . . . . . . 30
12.2 Other Remedies . . . . . . . . . . . . . . . . 31
12.3 Rescission . . . . . . . . . . . . . . . . . . 31
12.4 No Waivers or Election of Remedies, Expenses,
etc . . . . . . . . . . . . . . . . . . . . . . 31
13. REGISTRATION; EXCHANGE; SUBSTITUTION OF NOTES . . . . . . 32
13.1 Registration of Notes . . . . . . . . . . . . . 32
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13.2 Transfer and Exchange of Notes . . . . . . . . 32
13.3 Replacement of Notes . . . . . . . . . . . . . 32
14. PAYMENTS ON NOTES . . . . . . . . . . . . . . . . . . . . 33
14.1 Place of Payment . . . . . . . . . . . . . . . 33
14.2 Home Office Payment . . . . . . . . . . . . . . 33
15. EXPENSES, ETC . . . . . . . . . . . . . . . . . . . . . . 33
15.1 Transaction Expenses . . . . . . . . . . . . . 33
15.2 Survival . . . . . . . . . . . . . . . . . . . 34
16. SURVIVAL OF REPRESENTATIONS AND WARRANTIES; ENTIRE
AGREEMENT . . . . . . . . . . . . . . . . . . . . . . . . 34
17. AMENDMENT AND WAIVER . . . . . . . . . . . . . . . . . . 34
17.1 Requirements . . . . . . . . . . . . . . . . . 34
17.2 Solicitation of Holders of Notes . . . . . . . 35
17.3 Binding Effect, etc . . . . . . . . . . . . . . 35
17.4 Notes held by Company, etc . . . . . . . . . . 35
18. NOTICES . . . . . . . . . . . . . . . . . . . . . . . . . 35
19. REPRODUCTION OF DOCUMENTS . . . . . . . . . . . . . . . . 36
20. SUBSTITUTION OF PURCHASER . . . . . . . . . . . . . . . . 36
21. MISCELLANEOUS . . . . . . . . . . . . . . . . . . . . . . 37
21.1 Successors and Assigns . . . . . . . . . . . . . . . . . 37
21.2 Payments Due on Non-Business Days; When Payments
Deemed Received . . . . . . . . . . . . . . . . . . . . . 37
21.3 Severability . . . . . . . . . . . . . . . . . 37
21.4 Construction . . . . . . . . . . . . . . . . . 37
21.5 Counterparts . . . . . . . . . . . . . . . . . 37
21.6 Governing Law . . . . . . . . . . . . . . . . . 38
SCHEDULE A -- Information Relating to Purchasers
SCHEDULE B -- Defined Terms
SCHEDULE 4.9 -- Changes in Corporate Structure
SCHEDULE 5.3 -- Disclosure Materials
SCHEDULE 5.4 -- Subsidiaries of the Company and Ownership of
Subsidiary Stock
SCHEDULE 5.5 -- Financial Statements
SCHEDULE 5.8 -- Certain Litigation
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SCHEDULE 5.11 -- Patents, etc.
SCHEDULE 5.12 -- ERISA Affiliates
SCHEDULE 5.14 -- Use of Proceeds
SCHEDULE 5.15 -- Existing Indebtedness and Liens
SCHEDULE 5.23 -- WLR Common Stock
SCHEDULE 8.1(d)-- Existing Stock Incentive Program
SCHEDULE 10.1 -- Negative Covenants
SCHEDULE 10.2 -- Financial Covenants
EXHIBIT 2(a) -- Form of Variable Rate Senior Note due
December 31, 1999
EXHIBIT 2(b) -- Form of Warrant Certificate
EXHIBIT 4.4(a) -- Form of Opinion of Special Counsel for the
Company
EXHIBIT 4.4(b) -- Form of Opinion of Special Counsel for the
Purchasers
EXHIBIT 4.11(a) -- Form of Guaranty Agreement
EXHIBIT 4.11(b) -- Form of Certificate of Vice
President/Treasurer of Subsidiary Guarantor
EXHIBIT 4.13(b) -- Form of Collateral Agency and Intercreditor
Agreement
EXHIBIT 4.16 -- Form of Warrantholders Rights Agreement
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WLR FOODS, INC.
000 Xx-xx Xxxxx
Xxxxxxxxxxx, Xxxxxxxx 00000
$42,040,162.73 Variable Rate Senior Notes Due December 31, 1999
177,980 Warrants to Acquire Common Stock
Dated as of February 25, 1998
To each of the Purchasers Named on
the Signature Page Hereto
Ladies and Gentlemen:
WLR FOODS, INC. , a Virginia corporation (together with its
successors and assigns, the "Company"), agrees with you as follows:
1. BACKGROUND.
The Company has heretofore issued its
(a) 9.41% Senior Notes due May 1, 2001 (collectively,
as in effect immediately prior to the Closing Date, the
"Existing 1991 Notes") in the aggregate original principal
amount of Thirty Million Dollars ($30,000,000) pursuant to that
certain Note Agreement (as amended and in effect immediately
prior to the Closing Date, the "Existing 1991 Note Agreement"),
dated as of May 1, 1991, between the Company and the purchasers
identified on Schedule 1 thereto (the "Existing 1991
Purchasers"), the aggregate outstanding principal amount of the
Existing 1991 Notes on the Closing Date is Eighteen Million
Dollars ($18,000,000), and
(b) 7.47% Senior Notes, Series B, due June 1, 2007
(collectively, as in effect immediately prior to the Closing
Date, the "Existing 1995 Notes"; and together with the
Existing 1991 Notes, the "Existing Notes") in the aggregate
original principal amount of Twenty-Two Million Dollars
($22,000,000) pursuant to that certain Note Agreement (as
amended and in effect immediately prior to the Closing Date,
the "Existing 1995 Note Agreement"; and together with the
Existing 1991 Note Agreement, the "Existing Note Agreements"),
dated as of June 1, 1995, between the Company and the purchasers
identified on Schedule 1 thereto (the "Existing 1995 Purchasers";
and together with the Existing 1991 Purchasers and their
respective transferees, the "Purchasers"), all of the principal
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amount of the Existing 1995 Notes being outstanding on the
Closing Date.
The Purchasers own 100% of the Existing Notes outstanding on the
Closing Date. The Company wishes to exchange the Existing Notes for
new senior notes and, in connection therewith, issue to the Purchasers
Warrants (as defined herein), in each case, on the terms and
conditions contained herein. References to a "Schedule" or an
"Exhibit" are, unless otherwise specified, to a Schedule or an Exhibit
attached to this Agreement; and references to a "Section" are, unless
otherwise specified, to a Section of this Agreement. Certain
capitalized terms used in this Agreement (including Schedule 10.1 and
Schedule 10.2) are defined in Schedule B.
2. AUTHORIZATION OF NOTES AND WARRANTS.
The Company will authorize the issuance and sale of
(a) $42,040,162.73 in aggregate principal amount of its
Variable Rate Senior Notes Due December 31, 1999 (all such notes,
whether initially issued, or issued in exchange or substitution
for, any such note, in each case in accordance with this
Agreement, and as amended from time to time, the "Notes"), which
notes shall be substantially in the form of Exhibit 2(a) and
shall have the terms as herein and therein provided, and
(b) An aggregate of 177,980 warrants (the "Warrants")
to purchase shares of Common Stock, which Warrants shall be
issued pursuant to a warrant certificate (as may be amended,
restated or otherwise modified from time to time, the "Warrant
Certificate") in the form of Exhibit-2(b). The Warrant
Certificates provide that a holder thereof may tender Notes to
the Company in partial or complete payment of the purchase price
for the shares of Common Stock issued upon exercise. Promptly
following the receipt of any Note so tendered, the Company shall
immediately cancel and retire the same (and no such Note shall be
reissued), and shall issue to the holder thereof a new Note in
the principal amount of the tendered Note remaining after
deduction of the principal amount thereof applied to payment of
the exercise price. For purposes of Rule 144 under the
Securities Act, 17 C.F.R. Section 230.144, the Company and you
agree that a tender of Notes in payment of the exercise price in
respect of the Warrant Certificates shall not be deemed a
prepayment of the Notes, but rather a conversion of such Notes,
pursuant to the terms of the Warrant Certificates, into Common
Stock.
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3. EXCHANGE OF EXISTING NOTES.
3.1 The Closing.
(a) Exchange of Existing Notes. The Company hereby
agrees to deliver to you and you hereby agree to accept from
the Company, in accordance with the provisions hereof, the
aggregate principal amount of Notes indicated below your name on
Schedule A in exchange for one or more Existing Notes having an
aggregate outstanding principal balance, at the time of such
exchange, equal to the principal amount of Existing Notes
indicated below your name in Schedule A. The Company hereby
further agrees to issue in consideration of your exchange of
Existing Notes, in accordance with the provisions hereof, the
aggregate number of Warrants set forth below your name on
Schedule A. The Company acknowledges and agrees that the
aggregate principal amount of the Notes on the Closing Date
represents a restructuring of amounts owed to the Purchasers
pursuant to the Existing Note Agreements. No Purchasers shall be
required to make any advance of funds to the Company on account
of the Notes.
(b) The Closing. The closing (the "Closing") of the
exchange described in Section 3.1(a) will be held on February 25,
1998 (the "Closing Date") at 10:00 a.m., local time, at the
offices of Duane, Morris & Heckscher LLP, Xxx Xxxxxxx Xxxxx,
Xxxxxxxxxxxx, XX 00000. At the Closing, the Company will deliver
to you
(i) one or more Notes (as indicated below your
name on Schedule A) in the denominations indicated on
Schedule A, registered in your name or the name of your
nominee (as indicated below your name on Schedule A),
in the aggregate principal amount set forth on Schedule
A, each dated the Closing Date, and
(ii) one or more Warrant Certificates (as set
forth below your name on Schedule A), representing the
number of Warrants indicated on such Schedule A and
registered in the name of the holder indicated on
Schedule A,
against your delivery to the Company of Existing Notes
having an aggregate outstanding principal balance equal to the
aggregate principal amount of Existing Notes indicated below your
name on Schedule A. If at the Closing the Company shall fail to
tender such Notes and Warrants to you as provided above in this
Section 3, or any of the conditions specified in Section 4 shall
not have been fulfilled to your satisfaction, you shall, at your
election, be relieved of all further obligations under this
8
Agreement, without thereby waiving any rights you may have by
reason of such failure or such nonfulfillment, and the Existing
Note Agreements shall remain in full force and effect.
(c) Original Issue Discount. You and the Company agree
that, as a result of the delivery of the Warrants in accordance
with the terms of this Agreement, any original issue discount
attributable to any Note is less than the product of (i) one-
quarter of one percent (.25%), multiplied by (ii) the product of
the weighted average maturity of such Note multiplied by the
stated redemption price at maturity of such Note (as determined
in accordance with section 1273 of the Code). You and the
Company agree to consistently use the foregoing assumptions as to
original issue discount and redemption premium for all United
States federal, state and local income tax purposes with respect
to the transactions contemplated by this Agreement and the
Warrant Certificates held by you unless the IRS or a change in
law requires otherwise. You and the Company acknowledge that the
Fair Market Value of such Warrants as of the Closing Date is no
greater than the amount determined by the calculations in the
first sentence of this subsection.
(d) Other Purchasers. The obligations of the Purchasers
and the Company hereunder are subject to the execution and
delivery of this Agreement by each of the Persons set forth on
the signature pages hereto. The obligations of each Purchaser
shall be several and not joint and no Purchaser shall be liable
or responsible for the act of any other Purchaser.
(e) Effect of Exchange. Upon the issuance by the
Company of the Notes and delivery thereof to the Purchaser as
provided for in this Section 3, the Existing Notes shall be
deemed cancelled and the obligations of the Company under the
Existing Note Agreements (except those which expressly survive
the payment of the Existing Notes) shall be terminated and of no
further force and effect.
4. CONDITIONS TO CLOSING.
Your obligation to exchange your Existing Notes for the Notes and
Warrants set forth below your name on Schedule A at the Closing is
subject to the conditions precedent set forth in this Section 4. The
failure of the Company to satisfy such conditions shall not operate to
waive any of your rights against the Company.
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4.1 Representations and Warranties.
The representations and warranties of the Company in this
Agreement shall be correct when made and at the time of the Closing.
4.2 Performance; No Default.
The Company shall have performed and complied with all agreements
and conditions contained in this Agreement required to be performed or
complied with by it prior to or at the Closing, and after giving
effect to the issue of the Notes and Warrants no Default or Event of
Default shall have occurred and be continuing.
4.3 Compliance Certificates.
(a) Officer's Certificate. The Company shall have
delivered to you an Officer's Certificate, dated the Closing
Date, certifying that the conditions specified in Sections 4.1,
4.2 and 4.9 have been fulfilled.
(b) Secretary's Certificate. The Company shall have
delivered to you a certificate of its Secretary or one of its
Assistant Secretaries, dated the Closing Date, certifying as to
the resolutions attached thereto and other corporate proceedings
relating to the authorization, execution and delivery of the
Financing Documents to which it is a party.
4.4 Opinions of Counsel.
You shall have received opinions in form and substance
satisfactory to you, dated the Closing Date, from
(a) Xxxxxxx, Xxxxxxxx & Xxxxxx, P.L.C., counsel for the
Company, substantially in the form set out in Exhibit 4.4(a) and
covering such other matters incident to the transactions
contemplated hereby as you or your counsel may reasonably request
(and the Company hereby instructs such counsel to deliver such
opinion to you), and
(b) Xxxx & Xxxxxx, your special counsel in connection
with such transactions, substantially in the form set out in
Exhibit 4.4(b) and covering such other matters incident to such
transactions as you may reasonably request.
4.5 Exchange Permitted By Applicable Law, etc.
On the Closing Date your acquisition of the Notes and Warrants
shall (a) be permitted by the laws and regulations of each
10
jurisdiction to which you are subject, without recourse to provisions
(such as section 1405(a)(8) of the New York Insurance Law) permitting
limited investments by insurance companies without restriction as to
the character of the particular investment, (b) not violate any
applicable law or regulation (including, without limitation,
Regulation G, T or X of the Board of Governors of the Federal Reserve
System) and (c) not subject you to any tax, penalty or liability under
or pursuant to any applicable law or regulation. If requested by you,
you shall have received an Officer's Certificate certifying as to such
matters of fact as you may reasonably specify to enable you to
determine whether such purchase is so permitted.
4.6 Exchange of Notes and Issuance of Warrants.
The Company shall have delivered all Notes and Warrants scheduled
to be issued to the Purchasers and the Purchasers shall have delivered
their Existing Notes to the Company at the Closing as specified in
Schedule A.
4.7 Payment of Fees and Expenses.
In addition, without limiting the provisions of Section 15.1, the
Company shall have paid on or before the Closing the fees, charges and
disbursements of your special counsel referred to in Section 4.4(b) to
the extent reflected in a statement of such counsel rendered to the
Company at least one Business Day prior to the Closing Date.
4.8 Private Placement Number.
Private Placement Numbers issued by Standard & Poor's CUSIP
Service Bureau (in cooperation with the Securities Valuation Office of
the National Association of Insurance Commissioners) shall have been
obtained for the Notes and the Warrants.
4.9 Changes in Corporate Structure.
Except as specified in Schedule 4.9, the Company shall not have
changed its jurisdiction of incorporation or been a party to any
merger or consolidation and shall not have succeeded to all or any
substantial part of the liabilities of any other entity, at any time
following the date of the most recent financial statements referred to
in Schedule 5.5.
4.10 Payment of Fees.
The Company shall have paid to each Purchaser, as consideration
of its consent to the exchange of Notes as provided herein, a fee (the
"Restructure Fee") equal to the amount equal to the product of (a) the
aggregate principal amount of Existing Notes held by such Purchaser
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and being exchanged herein multiplied by (b) one percent (1.00%). The
Restructure Fee shall have been paid to each Purchaser in immediately
available funds to the account of such Purchaser designated for
payments on Schedule A.
4.11 Subsidiary Guarantees.
You shall have received
(a) a guaranty agreement (as amended from time to time, a
"Subsidiary Guaranty") substantially in the form of Exhibit
4.11(a), executed and delivered by each Subsidiary Guarantor,
(b) a certificate dated the Closing Date and signed by
a Vice President or Treasurer of each Subsidiary Guarantor,
substantially in the form of Exhibit 4.11(b), and
(c) a certificate dated the Closing Date and signed by
the Secretary or an Assistant Secretary of each Subsidiary
Guarantor, certifying as to the resolutions attached thereto
and other corporate proceedings relating to the authorization,
execution and delivery of the Financing Documents to which such
Subsidiary Guarantor is a party.
4.12 Payment of Interest on Existing Notes.
The Company shall have paid to each Purchaser all interest
accrued and unpaid on its Existing Notes as of the Closing Date.
4.13 Security Documents.
(a) The Company and each of the Subsidiary Guarantors
shall have executed and delivered to the Collateral Agent each of
the Security Documents, the forms of which must be acceptable to
you.
(b) The Company, the Subsidiary Guarantors, the
Purchasers, the Lenders, the Bank Agent and the Collateral Agent
shall have executed and delivered a collateral agency and
intercreditor agreement (as amended from time to time, the
"Intercreditor Agreement") substantially in the form of Exhibit
4.13(b).
4.14 Perfection of Liens.
Confirmation that (i) all actions necessary to perfect the Liens
of the Collateral Agent in the Collateral, including, without
limitation, the filing of all appropriate Uniform Commercial Code
financing statements, the recording of all appropriate documents with
12
public officials and the delivery of any appropriate items of
Collateral to the Collateral Agent shall have been taken in accordance
with the provisions of the relevant Security Documents, and (ii) the
Liens of the Collateral Agent in the Collateral shall be valid,
enforceable and perfected and such Collateral shall be subject to no
other Liens not otherwise permitted under this Agreement.
4.15 Bank Credit Agreements.
(a) Bank Credit Agreements. The Company, the Bank Agent
and the Lenders shall have entered into the Bank Credit
Agreements, which agreements, and all documents and instruments
executed and delivered in connection therewith, shall be in form
and substance satisfactory to you. The Company shall deliver to
you a copy of a fully executed counterpart of the Bank Credit
Agreements and each such document and instrument executed
therewith, certified as true and correct by an officer of the
Company.
(b) No Defaults; Satisfaction of Conditions Precedent.
No event shall have occurred and no condition shall exist that
shall prohibit the Company from borrowing under the Bank Credit
Agreements, and all conditions precedent to closing specified in
the Bank Credit Agreements shall have been satisfied on or prior
to the Closing Date, and you shall have received such evidence of
the satisfaction of such conditions precedent as you shall deem
appropriate.
4.16 Warrantholders Rights Agreement.
The Company, the Purchasers, the Bank Agent and the Stockholders
(as defined therein) shall have entered into a warrantholders rights
agreement (as amended from time to time, the "Warrantholders Rights
Agreement") substantially in the form of Exhibit 4.16.
4.17 Proceedings and Documents.
All corporate and other proceedings in connection with the
transactions contemplated by this Agreement and all documents and
instruments incident to such transactions shall be satisfactory to you
and your special counsel, and you and your special counsel shall have
received all such counterpart originals or certified or other copies
of such documents as you or they may reasonably request.
5. REPRESENTATIONS AND WARRANTIES OF THE COMPANY.
The Company represents and warrants to you, as of the Closing
Date, that:
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5.1 Organization; Power and Authority.
The Company is a corporation duly organized, validly existing and
in good standing under the laws of its jurisdiction of incorporation,
and is duly qualified as a foreign corporation and is in good standing
in each jurisdiction in which such qualification is required by law,
other than those jurisdictions as to which the failure to be so
qualified or in good standing could not, individually or in the
aggregate, reasonably be expected to have a Material Adverse Effect.
The Company has the corporate power and authority to own or hold under
lease the properties it purports to own or hold under lease, to
transact the business it transacts and proposes to transact, to
execute and deliver this Agreement, the Notes and each Warrant
Certificate and to perform the provisions hereof and thereof.
5.2 Authorization, etc.
This Agreement, the Notes and the Warrants have been duly
authorized by all necessary corporate action on the part of the
Company, and this Agreement constitutes, and upon execution and
delivery thereof each Note and each Warrant Certificate will
constitute, a legal, valid and binding obligation of the Company
enforceable against the Company in accordance with its terms, except
as such enforceability may be limited by (a) applicable bankruptcy,
insolvency, reorganization, moratorium or other similar laws affecting
the enforcement of creditors' rights generally and (b) general
principles of equity (regardless of whether such enforceability is
considered in a proceeding in equity or at law).
5.3 Disclosure.
The Company has delivered to you a copy of WLR Foods, Inc.
Financial Plan -- Management's Assumptions, dated January 28, 1998 and
the WLR Foods, Inc. Marshville Conversion, dated February 4, 1998
(collectively, the "Memorandum"), relating to the transactions
contemplated hereby. The Memorandum fairly describes, in all material
respects, the general nature of the business and principal properties
of the Company and its Subsidiaries. Except as disclosed in Schedule
5.3, this Agreement, the Memorandum, the documents, certificates or
other writings delivered to you by or on behalf of the Company in
connection with the transactions contemplated hereby and the financial
statements listed in Schedule 5.5, taken as a whole, do not contain
any untrue statement of a material fact or omit to state any material
fact necessary to make the statements therein not misleading in light
of the circumstances under which they were made. Except as disclosed
in the Memorandum or as expressly described in Schedule 5.3, or in one
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of the documents, certificates or other writings identified therein,
or in the financial statements listed in Schedule 5.5, since June 28,
1997, there has been no change in the financial condition, operations,
business, properties or prospects of the Company or any Subsidiary
except changes that individually or in the aggregate could not
reasonably be expected to have a Material Adverse Effect. There is no
fact known to the Company that could reasonably be expected to have a
Material Adverse Effect that has not been set forth herein or in the
Memorandum or in the other documents, certificates and other writings
delivered to you by or on behalf of the Company specifically for use
in connection with the transactions contemplated hereby.
5.4 Organization and Ownership of Shares of Subsidiaries;
Affiliates.
(a) Schedule 5.4 contains (except as noted therein)
complete and correct lists of (i) the Company's Subsidiaries,
showing, as to each Subsidiary, the correct name thereof, the
jurisdiction of its organization, and the percentage of shares of
each class of its capital stock or similar equity interests
outstanding owned by the Company and each other Subsidiary and
(ii) the Company's Affiliates, other than Subsidiaries.
(b) All of the outstanding shares of capital stock or
similar equity interests of each Subsidiary shown in Schedule 5.4
as being owned by the Company and its Subsidiaries have been
validly issued, are fully paid and nonassessable and are owned by
the Company or another Subsidiary free and clear of any Lien
(except as otherwise disclosed in Schedule 5.4).
(c) Each Subsidiary identified in Schedule 5.4 is a
corporation or other legal entity duly organized, validly
existing and in good standing under the laws of its
jurisdiction of organization, and is duly qualified as a
foreign corporation or other legal entity and is in good
standing in each jurisdiction in which such qualification is
required by law, other than those jurisdictions as to which
the failure to be so qualified or in good standing could not,
individually or in the aggregate, reasonably be expected to have
a Material Adverse Effect. Each such Subsidiary has the
corporate or other power and authority to own or hold under lease
the properties it purports to own or hold under lease and to
transact the business it transacts and proposes to transact.
(d) No Subsidiary is a party to, or otherwise subject
to any legal restriction or any agreement (other than this
Agreement, the Bank Credit Agreements, the agreements listed
15
in Schedule 5.4 and customary limitations imposed by corporate
law statutes) restricting the ability of such Subsidiary to pay
dividends out of profits or make any other similar distributions
of profits to the Company or any of its Subsidiaries that owns
outstanding shares of capital stock or similar equity interests
of such Subsidiary.
5.5 Financial Statements.
The Company has delivered to you copies of the financial
statements of the Company and its Subsidiaries listed in Schedule 5.5.
All of said financial statements (including in each case the related
schedules and notes) fairly present in all material respects the
consolidated financial position of the Company and its Subsidiaries as
of the respective dates specified in such Schedule and the
consolidated results of their operations and cash flows for the
respective periods so specified and have been prepared in accordance
with GAAP consistently applied throughout the periods involved except
as set forth in the notes thereto (subject, in the case of any interim
financial statements, to normal year-end adjustments).
5.6 Compliance with Laws, Other Instruments, etc.
The execution, delivery and performance by the Company of the
Financing Documents to which it is a party will not
(a) contravene, result in any breach of, or constitute
a default under, or result in the creation of any Lien in
respect of any property of the Company or any Subsidiary
under, any indenture, mortgage, deed of trust, loan, purchase or
credit agreement, lease, corporate charter or by-laws, or any
other agreement or instrument to which the Company or any
Subsidiary is bound or by which the Company or any Subsidiary or
any of their respective properties may be bound or affected,
(b) conflict with or result in a breach of any of the
terms, conditions or provisions of any order, judgment,
decree, or ruling of any court, arbitrator or Governmental
Authority applicable to the Company or any Subsidiary, or
(c) violate any provision of any statute or other rule or
regulation of any Governmental Authority applicable to the
Company or any Subsidiary.
5.7 Governmental Authorizations, etc.
No consent, approval or authorization of, or registration, filing
or declaration with, any Governmental Authority is required in
connection with the execution, delivery or performance by the Company
16
of the Financing Documents to which it is a party except for the
filing of financing statements in favor of the Collateral Agent and,
to the extent applicable to any Collateral, filings with the United
States Copyright Office or the United States Patent and Trademark
Office, filings with state transportation authorities with respect to
liens on motor vehicles and any filing or action in compliance with
the Federal Assignment of Claims Act.
5.8 Litigation; Observance of Agreements, Statutes and Orders.
(a) Except as disclosed in Schedule 5.8, there are no
actions, suits or proceedings pending or, to the knowledge of the
Company, threatened against or affecting the Company or any
Subsidiary or any property of the Company or any Subsidiary in
any court or before any arbitrator of any kind or before or by
any Governmental Authority that, individually or in the
aggregate, could reasonably be expected to have a Material
Adverse Effect.
(b) Except with respect to the 1997 Credit Agreement (as
defined in the Bank Credit Agreements) and the Existing Note
Agreements, neither the Company nor any Subsidiary is in default
under any term of any agreement or instrument to which it is a
party or by which it is bound, or any order, judgment, decree or
ruling of any court, arbitrator or Governmental Authority or is
in violation of any applicable law, ordinance, rule or regulation
(including, without limitation, Environmental Laws) of any
Governmental Authority, which default or violation, individually
or in the aggregate, could reasonably be expected to have a
Material Adverse Effect.
5.9 Taxes.
The Company and its Subsidiaries have filed all tax returns that
are required to have been filed in any jurisdiction, and have paid all
taxes shown to be due and payable on such returns and all other taxes
and assessments levied upon them or their properties, assets, income
or franchises, to the extent such taxes and assessments have become
due and payable and before they have become delinquent, except for any
taxes and assessments (a) the amount of which is not individually or
in the aggregate Material or (b) the amount, applicability or validity
of which is currently being contested in good faith by appropriate
proceedings and with respect to which the Company or a Subsidiary, as
the case may be, has established adequate reserves in accordance with
GAAP. The Company knows of no basis for any other tax or assessment
that could reasonably be expected to have a Material Adverse Effect.
The charges, accruals and reserves on the books of the Company and its
17
Subsidiaries in respect of Federal, state or other taxes for all
fiscal periods are adequate. The Federal income tax liabilities of
the Company and its Subsidiaries have been paid for all fiscal years
up to and including the fiscal year ended June 28, 1997.
5.10 Title to Property; Leases.
The Company and its Subsidiaries have good and sufficient title
to their respective properties that individually or in the aggregate
are Material, including all such properties reflected in the most
recent audited balance sheet referred to in Section 5.5 or purported
to have been acquired by the Company or any Subsidiary after said date
(except as sold or otherwise disposed of in the ordinary course of
business), in each case free and clear of Liens prohibited by this
Agreement. All leases that individually or in the aggregate are
Material are valid and subsisting and are in full force and effect in
all material respects.
5.11 Licenses, Permits, etc.
Except as disclosed in Schedule 5.11,
(a) the Company and its Subsidiaries own or possess all
licenses, permits, franchises, authorizations, patents,
copyrights, service marks, trademarks and trade names, or
rights thereto, that individually or in the aggregate are
Material, without known conflict with the rights of others;
(b) to the best knowledge of the Company, no product or
practice of the Company or any Subsidiary infringes in any
material respect any license, permit, franchise, authorization,
patent, copyright, service xxxx, trademark, trade name or other
right owned by any other Person; and
(c) to the best knowledge of the Company, there is no
Material violation by any Person of any right of the Company
or any of its Subsidiaries with respect to any patent,
copyright, service xxxx, trademark, trade name or other right
owned or used by the Company or any of its Subsidiaries.
5.12 Compliance with ERISA.
(a) The Company and each ERISA Affiliate have operated
and administered each Plan in compliance with all applicable
laws except for such instances of noncompliance as have not
resulted in and could not reasonably be expected to result in a
Material Adverse Effect. Neither the Company nor any ERISA
Affiliate has incurred any liability pursuant to Title I or IV of
18
ERISA or the penalty or excise tax provisions of the Code
relating to employee benefit plans (as defined in section 3 of
ERISA), and no event, transaction or condition has occurred or
exists that could reasonably be expected to result in the
incurrence of any such liability by the Company or any ERISA
Affiliate, or in the imposition of any Lien on any of the rights,
properties or assets of the Company or any ERISA Affiliate, in
either case pursuant to Title I or IV of ERISA or to such penalty
or excise tax provisions or to section 401(a)(29) or 412 of the
Code, other than such liabilities or Liens as would not be
individually or in the aggregate Material.
(b) The present value of the aggregate benefit
liabilities under each of the Plans (other than Multiemployer
Plans), determined as of the end of such Plan's most recently
ended plan year on the basis of the actuarial assumptions
specified for funding purposes in such Plan's most recent
actuarial valuation report, did not exceed the aggregate current
value of the assets of such Plan allocable to such benefit
liabilities. The term "benefit liabilities" has the meaning
specified in section 4001 of ERISA and the terms "current value"
and "present value" have the meaning specified in section 3 of
ERISA.
(c) The Company and the ERISA Affiliates have not
incurred withdrawal liabilities (and are not subject to
contingent withdrawal liabilities) under section 4201 or 4204 of
ERISA in respect of Multiemployer Plans that individually or in
the aggregate are Material.
(d) The expected postretirement benefit obligation
(determined as of the last day of the Company's most recently
ended fiscal year in accordance with Financial Accounting
Standards Board Statement No. 106, without regard to liabilities
attributable to continuation coverage mandated by section 4980B
of the Code) of the Company and its Subsidiaries is not Material.
(e) The execution and delivery of this Agreement and the
issuance of the Notes and the Warrant Certificates hereunder will
not involve any transaction that is subject to the prohibitions
of section 406 of ERISA or in connection with which a tax could
be imposed pursuant to section 4975(c)(1)(A)-(D) of the Code.
The representation by the Company in the first sentence of this
Section 5.12(e) is made in reliance upon and subject to the
accuracy of your representation in Section 6.2 as to the Sources
used to pay the purchase price of the Notes to be purchased by
you.
19
(f) Schedule 5.12 sets forth all ERISA Affiliates and
all "employee benefit plans" maintained by the Company (or any
"affiliate" thereof) or in respect of which the Notes could
constitute an "employer security" ("employee benefit plan" has
the meaning specified in section 3 of ERISA, "affiliate" has the
meaning specified in section 407(d) of ERISA and section V of the
Department of Labor Prohibited Transaction Exemption 95-60 (60 FR
35925, July 12, 1995) and "employer security" has the meaning
specified in section 407(d) of ERISA).
5.13 Private Offering by the Company.
Neither the Company nor anyone acting on its behalf has offered
the Notes, the Warrants or any similar securities for sale to, or
solicited any offer to buy any of the same from, or otherwise
approached or negotiated in respect thereof with, any Person other
than each Purchaser and the Lenders. Neither the Company nor anyone
acting on its behalf has taken, or will take, any action that would
subject the issuance or sale of the Notes or Warrants to the
registration requirements of section 5 of the Securities Act.
5.14 Use of Proceeds; Margin Regulations.
The Company will apply the proceeds of the Notes as set forth in
Schedule 5.14. No additional proceeds are being funded by the
exchange of Existing Notes for Notes hereunder. The proceeds of the
Existing Notes were not used, directly or indirectly, for the purpose
of buying or carrying any margin stock within the meaning of
Regulation G of the Board of Governors of the Federal Reserve System
(12 CFR 207), or for the purpose of buying or carrying or trading in
any securities under such circumstances as to involve the Company in a
violation of Regulation X of said Board (12 CFR 224) or to involve any
broker or dealer in a violation of Regulation T of said Board (12 CFR
220). Margin stock does not constitute more than 1% of the value of
the consolidated assets of the Company and its Subsidiaries and the
Company does not have any present intention that margin stock will
constitute more than 1% of the value of such assets. As used in this
Section, the terms "margin stock" and "purpose of buying or carrying"
shall have the meanings assigned to them in said Regulation G.
5.15 Existing Indebtedness; Future Liens.
(a) Except as described therein, Schedule 5.15 sets forth a
complete and correct list of all outstanding Indebtedness of the
Company and its Subsidiaries as of December 27, 1997 (and
specifying, as to each such Indebtedness, the collateral, if any,
20
securing such Indebtedness), since which date there has been no
Material change in the amounts, interest rates, sinking funds,
installment payments or maturities of the Indebtedness of the
Company or its Subsidiaries. Neither the Company nor any
Subsidiary is in default and no waiver of default is currently in
effect, in the payment of any principal or interest on any
Indebtedness of the Company or such Subsidiary and no event or
condition exists with respect to any Indebtedness of the Company
or any Subsidiary that would permit (or that with notice or the
lapse of time, or both, would permit) one or more Persons to
cause such Indebtedness to become due and payable before its
stated maturity or before its regularly scheduled dates of
payment.
(b) Except as disclosed in Schedule 5.15, neither the
Company nor any Subsidiary has agreed or consented to cause
or permit in the future (upon the happening of a contingency
or otherwise) any of its property, whether now owned or
hereafter acquired, to be subject to a Lien not permitted by
paragraph C of Schedule 10.1.
5.16 Foreign Assets Control Regulations, etc.
Neither the issuance of the Notes and Warrants by the Company
hereunder nor its use of the proceeds from the Existing Notes has or
will violate the Trading with the Enemy Act, as amended, or any of the
foreign assets control regulations of the United States Treasury
Department (31 CFR, Subtitle B, Chapter V, as amended) or any enabling
legislation or executive order relating thereto.
5.17 Status under Certain Statutes.
Neither the Company nor any Subsidiary is subject to regulation
under the Investment Company Act of 1940, as amended, the Public
Utility Holding Company Act of 1935, as amended, the Transportation
Acts (49 U.S.C.), as amended, or the Federal Power Act, as amended.
5.18 Environmental Matters.
Neither the Company nor any Subsidiary has knowledge of any claim
or has received any notice of any claim, and no proceeding has been
instituted raising any claim against the Company or any of its
Subsidiaries or any of their respective real properties now or
formerly owned, leased or operated by any of them or other assets,
alleging any damage to the environment or violation of any
Environmental Laws, except, in each case, such as could not reasonably
be expected to result in a Material Adverse Effect. Except as
otherwise disclosed to you in writing,
21
(a) neither the Company nor any Subsidiary has knowledge of
any facts which would give rise to any claim, public or private,
of violation of Environmental Laws or damage to the environment
emanating from, occurring on or in any way related to real
properties now or formerly owned, leased or operated by any of
them or to other assets or their use, except, in each case, such
as could not reasonably be expected to result in a Material
Adverse Effect;
(b) neither the Company nor any of its Subsidiaries has
stored any Hazardous Materials on real properties now or formerly
owned, leased or operated by any of them and has not disposed of
any Hazardous Materials in a manner contrary to any Environmental
Laws in each case in any manner that could reasonably be expected
to result in a Material Adverse Effect; and
(c) all buildings on all real properties now owned,
leased or operated by the Company or any of its Subsidiaries
are in compliance with applicable Environmental Laws, except
where failure to comply could not reasonably be expected to
result in a Material Adverse Effect.
5.19 No Defaults.
No event has occurred and no condition exists that, upon the
execution and delivery of the Financing Documents and the Bank Credit
Agreements by the Company and the Subsidiary Guarantors and the
issuance of the Notes by the Company and the Subsidiary Guarantors of
the Guaranty, would constitute a Default or an Event of Default.
5.20 Company and Subsidiary Guarantors.
The Company and the Subsidiary Guarantors are operated as part of
one consolidated business entity. The Subsidiary Guarantors are
directly dependent upon the Company for and in connection with their
respective business activities and their respective financial
resources. The Company and the Subsidiary Guarantors each will
receive a direct economic and financial benefit from the Indebtedness
incurred under this Agreement, the Notes and the Bank Credit
Agreements by the Company and under the Subsidiary Guaranty by the
Subsidiary Guarantors, and the incurrence of such Indebtedness is in
the best interests of the Company and each of the Subsidiary
Guarantors. The Subsidiary Guaranty is a valid and binding obligation
of each of the Subsidiary Guarantors enforceable against each
Subsidiary Guarantor in accordance with its terms.
22
5.21 Solvency.
The fair value of the business and assets of the Company and each
Subsidiary Guarantor is in excess of the amount that will be required
to pay its liabilities (including, without limitation, contingent,
subordinated, unmatured and unliquidated liabilities on existing
debts, as such liabilities may become absolute and matured), in each
case both prior to and after giving effect to the transactions
contemplated by the Financing Documents and the Bank Credit
Agreements. After giving effect to the transactions contemplated by
the Financing Documents and the Bank Credit Agreements, neither the
Company nor any of the Subsidiary Guarantors will be engaged in any
business or transaction, or about to engage in any business or
transaction, for which such Person has unreasonably small capital, and
none of such Persons has or had any intent to hinder, delay or defraud
any entity to which it is, or will become, on or after the Closing
Date, indebted or to incur debts that would be beyond its ability to
pay as such debts mature.
5.22 Inactive Subsidiaries.
Rockingham Poultry, Inc., a Virginia corporation, conducts no
business and has no assets. Rockingham Poultry, Inc. (VI) conducts a
foreign sales business and maintains a bank account with not more than
$15,000 on deposit therein.
5.23 WLR Common Stock.
As of the date hereof, there are 16,335,058 shares of Common
Stock issued and outstanding. Except as set forth on Schedule 5.23:
(a) there are no outstanding options, warrants or other rights to
acquire shares of Common Stock, whether or not presently exercisable;
(b) there are no outstanding securities convertible into shares of
Common Stock, whether or not presently convertible; and (c) there are
no understandings, agreements or commitments with respect to the
issuance of any such Securities.
6. REPRESENTATIONS OF THE PURCHASERS.
6.1 Acquisition for Investment.
You represent that you are acquiring the Notes for your own
account or for one or more separate accounts maintained by you or for
the account of one or more pension or trust funds and not with a view
to the distribution thereof, provided that the disposition of your or
their property shall at all times be within your or their control.
You understand that the Notes have not been registered under the
Securities Act and may be resold only if registered pursuant to the
provisions of the Securities Act or if an exemption from registration
is available, except under circumstances where neither such
23
registration nor such an exemption is required by law, and that the
Company is not required to register the Notes.
6.2 Source of Funds.
You represent that at least one of the following statements is an
accurate representation as to each source of funds (a "Source") used
by you to pay the purchase price of the Existing Notes purchased by
you under the Existing Note Agreements (and that each of such
statements is accurate with respect to the account (it being deemed
for the purposes herein as being a Source) which now holds such
Existing Note):
(a) the Source is an "insurance company general account" as
defined in United States Department of Labor Prohibited
Transaction Exemption ("PTE") 95-60 (60 FR 35925, July 12, 1995)
and in respect thereof you represent that there is no "employee
benefit plan" (as defined in section 3(3) of ERISA and section
4975(e)(1) of the Code, treating as a single plan all plans
maintained by the same employer or employee organization or
affiliate thereof) with respect to which the amount of the
general account reserves and liabilities of all contracts held by
or on behalf of such plan exceeds 10% of the total reserves and
liabilities of such general account (exclusive of separate
account liabilities) plus surplus, as set forth in the National
Association of Insurance Commissioners' Annual Statement filed
with your state of domicile and that such acquisition is eligible
for and satisfies the other requirements of such exemption; or
(b) if you are an insurance company, the Source does not
include assets allocated to any separate account maintained by
you in which any employee benefit plan (or its related trust) has
any interest, other than a separate account that is maintained
solely in connection with your fixed contractual obligations
under which the amounts payable, or credited, to such plan and to
any participant or beneficiary of such plan (including any
annuitant) are not affected in any manner by the investment
performance of the separate account; or
(c) the Source is either (i) an insurance company
pooled separate account, within the meaning of PTE 90-1
(issued January 29, 1990), or (ii) a bank collective investment
fund, within the meaning of the PTE 91-38 (issued July 12, 1991)
and, except as you have disclosed to the Company in writing
pursuant to this paragraph (c), no employee benefit plan or group
of plans maintained by the same employer or employee organization
beneficially owns more than 10% of all assets allocated to such
24
pooled separate account or collective investment fund; or
(d) the Source constitutes assets of an "investment fund"
(within the meaning of part V of PTE 84-14 (the "QPAM
Exemption")) managed by a "qualified professional asset manager"
or "QPAM" (within the meaning of part V of the QPAM Exemption),
no employee benefit plan's assets that are included in such
investment fund, when combined with the assets of all other
employee benefit plans established or maintained by the same
employer or by an affiliate (within the meaning of section
V(c)(1) of the QPAM Exemption) of such employer or by the same
employee organization and managed by such QPAM, exceed 20% of the
total client assets managed by such QPAM, the conditions of part
I(c) and (g) of the QPAM Exemption are satisfied, neither the
QPAM nor a person controlling or controlled by the QPAM (applying
the definition of "control" in section V(e) of the QPAM
Exemption) owns a 5% or more interest in the Company and
(i) the identity of such QPAM and
(ii) the names of all employee benefit plans whose
assets are included in such investment fund
have been disclosed to the Company in writing pursuant to this
paragraph (d); or
(e) the Source is a governmental plan; or
(f) the Source is one or more employee benefit plans,
or a separate account or trust fund comprised of one or more
employee benefit plans, each of which has been identified to
the Company in writing pursuant to this paragraph (f) or
pursuant to the Existing Note Agreements; or
(g) the Source does not include assets of any employee
benefit plan, other than a plan exempt from the coverage of
ERISA.
As used in this Section 6.2, the terms "employee benefit plan",
"governmental plan" and "separate account" shall have the respective
meanings assigned to such terms in Section 3 of ERISA.
7. INFORMATION AS TO COMPANY.
7.1 Financial and Business Information.
The Company shall deliver to each holder of Notes that is an
Institutional Investor:
25
(a) Monthly Statements -- as soon as practicable and in
any event within thirty days after the end of each calendar
month, such financial information as may be required to be
delivered to the Lenders pursuant to Section 7.1(c) of the Bank
Credit Agreements;
(b) Quarterly Statements -- within 45 days after the
end of each quarterly fiscal period in each fiscal year of the
Company (other than the last quarterly fiscal period of each such
fiscal year), duplicate copies of,
(i) a consolidated balance sheet of the Company
and its Subsidiaries as at the end of such quarter, and
(ii) consolidated statements of income, changes in
shareholders' equity and cash flows of the Company and
its Subsidiaries, for such quarter and (in the case of
the second and third quarters) for the portion of the
fiscal year ending with such quarter,
setting forth in each case in comparative form the figures for
the corresponding periods in the previous fiscal year, all in
reasonable detail, prepared in accordance with GAAP applicable to
quarterly financial statements generally, and certified by a
Senior Financial Officer as fairly presenting, in all material
respects, the consolidated financial position of the companies
being reported on and their consolidated results of operations
and cash flows, subject to changes resulting from year-end
adjustments;
(c) Annual Statements -- within 90 days after the end
of each fiscal year of the Company, duplicate copies of,
(i) a consolidated balance sheet of the Company
and its Subsidiaries, as at the end of such year, and
(ii) consolidated statements of income, changes in
shareholders' equity and cash flows of the Company and
its Subsidiaries, for such year,
setting forth in each case in comparative form the figures for
the previous fiscal year, all in reasonable detail, prepared in
accordance with GAAP, and accompanied by
(A) an opinion thereon of independent
certified public accountants of recognized
national standing, which opinion shall state that
such financial statements present fairly, in all
material respects, the consolidated financial
position of the companies being reported upon and
their consolidated results of operations and cash
26
flows and have been prepared in conformity with
GAAP, and that the examination of such accountants
in connection with such financial statements has
been made in accordance with generally accepted
auditing standards, and that such audit provides a
reasonable basis for such opinion in the
circumstances, and
(B) a certificate of such accountants
stating that they have reviewed this Agreement and
stating further whether, in making their audit,
they have become aware of any condition or event
that then constitutes a Default or an Event of
Default, and, if they are aware that any such
condition or event then exists, specifying the
nature and period of the existence thereof (it
being understood that such accountants shall not
be liable, directly or indirectly, for any failure
to obtain knowledge of any Default or Event of
Default unless such accountants should have
obtained knowledge thereof in making an audit in
accordance with generally accepted auditing
standards or did not make such an audit);
(d) SEC and Other Reports -- promptly upon their
becoming available, one copy of (i) each financial statement,
report (including, without limitation, the Company's annual
report to shareholders, if any, prepared pursuant to Rule 14a-3
under the Exchange Act), notice or proxy statement sent by the
Company or any Subsidiary to public securities holders generally,
and (ii) each regular or periodic report, each registration
statement (without exhibits except as expressly requested by such
holder), and each prospectus and all amendments thereto filed by
the Company or any Subsidiary with the Securities and Exchange
Commission;
(e) Notice of Default or Event of Default -- promptly, and
in any event within five days after a Responsible Officer
becoming aware of the existence of any Default or Event of
Default or that any Person has given any notice or taken any
action with respect to a claimed default hereunder or that any
Person has given any notice or taken any action with respect to a
claimed default of the type referred to in Section 11(f), a
written notice specifying the nature and period of existence
thereof and what action the Company is taking or proposes to take
with respect thereto;
(f) ERISA Matters -- promptly, and in any event within
five days after a Responsible Officer becoming aware of any
27
of the following, a written notice setting forth the nature
thereof and the action, if any, that the Company or an ERISA
Affiliate proposes to take with respect thereto:
(i) with respect to any Plan, any reportable
event, as defined in section 4043(b) of ERISA and the
regulations thereunder, for which notice thereof has
not been waived pursuant to such regulations as in
effect on the Closing Date; or
(ii) the taking by the PBGC of steps to institute,
or the threatening by the PBGC of the institution of,
proceedings under Section 4042 of ERISA for the
termination of, or the appointment of a trustee to
administer, any Plan, or the receipt by the Company or
any ERISA Affiliate of a notice from a Multiemployer
Plan that such action has been taken by the PBGC with
respect to such Multiemployer Plan; or
(iii) any event, transaction or condition that
could result in the incurrence of any liability by the
Company or any ERISA Affiliate pursuant to Title I or
IV of ERISA or the penalty or excise tax provisions of
the Code relating to employee benefit plans, or in the
imposition of any Lien on any of the rights, properties
or assets of the Company or any ERISA Affiliate
pursuant to Title I or IV of ERISA or such penalty or
excise tax provisions, if such liability or Lien, taken
together with any other such liabilities or Liens then
existing, could reasonably be expected to have a
Material Adverse Effect;
(g) Notices from Governmental Authority -- promptly, and in
any event within 30 days of receipt thereof, copies of any notice
to the Company or any Subsidiary from any Federal or state
Governmental Authority relating to any order, ruling, statute or
other law or regulation that could reasonably be expected to have
a Material Adverse Effect;
(h) Actions, Proceedings -- promptly after a
Responsible Officer becomes aware of the commencement thereof,
notice of any action or proceeding relating to the Company or any
Subsidiary in any court or before any Governmental Authority or
arbitration board or tribunal as to which there is a reasonable
possibility of an adverse determination and that, if adversely
determined, could reasonably be expected to have a Material
Adverse Effect;
(i) Financial Projections -- within thirty (30) days after
each such request, such financial projections for the Company and
28
the Subsidiaries as the Required Holders may from time to time
reasonably request;
(j) Three Year Business Plan -- on or before June 1, 1998,
a copy of the Company's three year business plan (the "Three Year
Business Plan") in form and substance satisfactory to the
Required Holders;
(k) Bank Credit Agreements and Security Documents -- to the
extent not otherwise required herein, promptly upon the receipt
or delivery thereof, a copy of each notice or other communication
received by the Company from the Bank Agent or Collateral Agent,
or delivered to the Bank Agent or Collateral Agent by the
Company, in connection with a "Default" or "Event of Default"
under the Bank Credit Agreements or the enforcement of any
remedies under the Bank Credit Agreements or any of the Security
Documents; and
(l) Requested Informationwith reasonable promptness, such
other data and information relating to the business, operations,
affairs, financial condition, assets or properties of the Company
or any of its Subsidiaries or relating to the ability of the
Company to perform its obligations hereunder and under the Notes
as from time to time may be reasonably requested by any such
holder of Notes, or such information regarding the Company
required to satisfy the requirements of 17 C.F.R. Section 230.144A, as
amended from time to time, in connection with any contemplated
transfer of the Notes.
7.2 Officer's Certificate.
Each set of financial statements delivered to a holder of Notes
pursuant to Section 7.1(a) or Section 7.1(b) hereof shall be
accompanied by a certificate of a Senior Financial Officer setting
forth:
(a) Covenant Compliance -- the information (including
detailed calculations) required in order to establish whether the
Company was in compliance with the requirements of the covenants
set forth on Schedule 10.1 and Schedule 10.2 and, during the
quarterly or annual period covered by the statements then being
furnished (including with respect to each such , where
applicable, the calculations of the maximum or minimum amount,
ratio or percentage, as the case may be, permissible under the
terms of such Sections, and the calculation of the amount, ratio
or percentage then in existence); and
(b) Event of Default -- a statement that such officer
has reviewed the relevant terms hereof and has made, or
29
caused to be made, under his or her supervision, a review of
the transactions and conditions of the Company and its
Subsidiaries from the beginning of the quarterly or annual
period covered by the statements then being furnished to the
date of the certificate and that such review has not disclosed
the existence during such period of any condition or event that
constitutes a Default or an Event of Default or, if any such
condition or event existed or exists (including, without
limitation, any such event or condition resulting from the
failure of the Company or any Subsidiaryto comply with any
Environmental Law), specifying the nature and period of existence
thereof and what action the Company shall have taken or proposes
to take with respect thereto.
7.3 Inspection.
The Company shall permit the representatives of each holder of
Notes that is an Institutional Investor, at the expense of the
Company, to visit and inspect any of the offices or properties of the
Company or any Subsidiary, to examine all their respective books of
account, records, reports and other papers, to make copies and
extracts therefrom, and to discuss their respective affairs, finances
and accounts with their respective officers and independent public
accountants (and by this provision the Company authorizes said
accountants to discuss the affairs, finances and accounts of the
Company and its Subsidiaries), all at such times as the Required
Holders may reasonably request not more often than twice during any
calendar year.
8. PAYMENT OF THE NOTES.
8.1 Required Prepayments; Payment at Maturity; Extension of
Maturity.
(a) Required Quarterly Prepayments. The Company shall
prepay, and there shall become due and payable, on March 31,
June 30, September 30 and December 31 in each year until the
Notes have been paid in full, commencing on March 31, 1999,
$260,098 principal amount (or such lesser principal amount as
shall then be outstanding) of the Notes, at par. Each partial
prepayment of the Notes pursuant to Section 8.1(b), Section
8.1(c), Section 8.1(d) or Section 8.2 will be applied to the
mandatory prepayments applicable to the Notes set forth in this
Section 8.1 in the order of the maturity thereof.
(b) Required Prepayments upon Asset Sales. Within two
(2) Business Days (except as set forth below) after the
consummation by the Company or any Subsidiary of any Asset Sale
(including, without limitation, any Approved Miscellaneous Asset
Sale), the Company shall apply 90% of the Net Proceeds in respect
30
of such Asset Sale to permanently reduce the Term Loan
Obligations, the Revolving Credit Obligations and the obligations
outstanding under the Notes and this Agreement by forwarding such
Net Proceeds (the "Asset Sale Proceeds") to the Agent and the
holders of the Notes in the respective percentages set forth in
Section 7(e) of the Intercreditor Agreement; provided that if no
Event of Default has occurred under this Agreement as of the date
such Net Proceeds are made available, the Company may apply the
first $12,000,000 of such Net Proceeds to either (i) its bona
fide costs and expenses (collectively, the "Marshville Conversion
Expenses") associated with the Marshville Facility Conversion, or
(ii) if, at any time on or before November 30, 1998, no such
expenses have been incurred or are outstanding and no Event of
Default has occurred, then to a reserve for the projected
Marshville Conversion Expenses pursuant to the financial
projections supplied by the Company on February 4, 1998, provided
further that, if on November 30, 1998, any funds are held in
reserve pursuant to this subsection (ii), such funds will be
released immediately to the Agent and the holders of the Notes in
the respective percentages set forth in Section 7(e) the
Intercreditor Agreement. The Company shall provide to each
holder of Notes an accounting of the Marshville Conversion
Expenses at the time of such application certified as true and
correct by the Chief Financial Officer of the Company. With
respect to a sale yielding Asset Sale Proceeds aggregating less
than $1,000,000, the Company may delay distribution to the
holders of Notes until the later of (i) the thirtieth (30th) day
following such sale, or (ii) the date on which the aggregate
amount of undistributed proceeds owed to the holders of Notes
pursuant to this Section 8.1(b) equals or exceeds $250,000.
(c) Required Prepayments upon Issuance of Subordinated
Debt. Within two (2) Business Days after the consummation of the
issuance of any Subordinated Debt by the Company or any
Subsidiary, the Company shall apply an amount equal to 100% of
the Net Proceeds of such Subordinated Debt to permanently reduce
the Term Loan Obligations, the Revolving Credit Obligations and
the obligations outstanding under the Notes and this Agreement by
forwarding such Net Proceeds to the Agent and the holders of the
Notes in the respective percentages set forth in Section 7(e) of
the Intercreditor Agreement.
(d) Required Prepayments upon Issuance of Company
Securities. Within two (2) Business Days after the
consummation of any issuance of Company Securities by the
Company or any Subsidiary, the Company shall apply an amount
equal to 50% of the Net Proceeds of such Company Securities to
31
permanently reduce the Term Loan Obligations, the Revolving
Credit Obligations and the obligations outstanding under the
Notes and this Agreement by forwarding such Net Proceeds to the
Agent and the holders of the Notes in the respective percentages
set forth in Section 7(e) of the Intercreditor Agreement;
provided that the Company's existing stock incentive programs, as
more fully described in Schedule 8.1(d) hereof, to the extent
limited to aggregate equity values of $2,000,000 or less on an
annual basis, shall not constitute new equity for purposes
hereof.
(e) Maturity of the Notes. The Company shall pay all
of the principal amount of the Notes remaining outstanding, if
any, on December 31, 1999; provided that the Company shall be
permitted to elect to extend the maturity of the Notes until
December 31, 2000 if the Company gives written notice of such
election to each holder of Notes at any time before June 30,
1999, and provided further that
(i) on the date of such notice and on December
31, 1999, there exists no Default or Event of Default;
(ii) at all times prior to December 31, 1999 there
has not occurred any Default or Event of Default which
has not been cured or been waived in writing by the
Required Holders during the applicable cure period, if
any;
(iii) the Company shall have paid the Extension
Fee to each holder of Notes; and
(iv) the Company shall have simultaneously
extended the "Non-Default Maturity Date" under each of
the Bank Credit Agreements in accordance with their
respective terms.
If the Company shall elect to extend the maturity of the Notes
pursuant to this Section 8.1(e) and such extension shall be
permitted hereunder, the principal amount of the Notes
outstanding on December 31, 2000, together with interest accrued
thereon shall become due and payable on December 31, 2000 and
Section 8.1 shall continue to apply in all respects.
8.2 Optional Prepayments.
The Company may, at its option, upon notice as provided below,
prepay at any time all, or from time to time any part of, the Notes
(but if in part, in an amount not less than Two Hundred Thousand
Dollars ($200,000) or such lesser amount as shall then be
outstanding), at 100% of the principal amount so prepaid. The Company
32
will give each holder of Notes written notice of each optional
prepayment under this Section 8.2 not less than 30 days and not more
than 60 days prior to the date fixed for such prepayment. Each such
notice shall specify such prepayment date, the aggregate principal
amount of the Notes to be prepaid on such date, the principal amount
of each Note held by such holder to be prepaid (determined in
accordance with Section 8.3), and the interest to be paid on the
prepayment date with respect to such principal amount being prepaid.
8.3 Allocation of Partial Prepayments.
In the case of each partial prepayment of the Notes, the
principal amount of the Notes to be prepaid shall be allocated among
all of the Notes at the time outstanding in proportion, as nearly as
practicable, to the respective unpaid principal amounts thereof not
theretofore called for prepayment.
8.4 Maturity; Surrender, etc.
In the case of each prepayment of Notes pursuant to this Section
8, the principal amount of each Note to be prepaid shall mature and
become due and payable on the date fixed for such prepayment, together
with interest on such principal amount accrued to such date. From and
after such date, unless the Company shall fail to pay such principal
amount when so due and payable, together with the interest thereon,
interest on such principal amount shall cease to accrue. Any Note
paid or prepaid in full shall be surrendered to the Company and
cancelled and shall not be reissued, and no Note shall be issued in
lieu of any prepaid principal amount of any Note.
8.5 No Other Optional Prepayments or Purchase of Notes.
The Company will not prepay (whether directly or indirectly by
purchase, redemption or other acquisition) any of the outstanding
Notes except upon the payment or prepayment of the Notes in accordance
with the terms of this Section 8. The Company will promptly cancel
all Notes acquired by it or any Affiliate pursuant to any payment,
prepayment or purchase of Notes pursuant to any provision of this
Section 8 and no Notes may be issued in substitution or exchange for
any such Notes.
8.6 Interest on Notes.
(a) Interest Rate on Notes. Each Note shall bear
interest on the outstanding principal amount thereof at a rate
per annum equal to the Base Rate plus two and twenty-five one-
hundredths percent (2.25%). Such interest shall be payable in
arrears on the last day of each calendar quarter, commencing with
March 31, 1998. The Base Rate shall be determined by the Bank
33
Agent and the Company shall cause the Bank Agent to notify, in
writing, each holder of Notes, at the address set forth on
Schedule A (or at such other address that any such holder shall
give the Company and the Bank Agent in writing) of any change in
the Base Rate within two (2) Business Days of any change thereof.
(b) Overdue Sums. Any overdue principal of, or interest
on, any Note shall bear interest, payable on demand, for each day
from and including the date payment thereof was due to, but
excluding, the date of actual payment, at a rate per annum (the
"Default Rate") equal to the lesser of
(A) the Maximum Legal Rate of Interest, or
(B) the then applicable Base Rate with
respect to such Note plus four and twenty-five
one-hundredths percent (4.25%).
(c) Basis of Computation. Interest on the Notes shall
be computed on the basis of a 365/366 day year and paid for
the actual number of days elapsed. Interest determined at the
Maximum Legal Rate of Interest shall be determined in accordance
with Applicable Interest Law.
(d) Maximum Rate of Interest.
It is the intention of the Company and the holders of the
Notes to conform strictly to the Applicable Interest Law.
Accordingly, notwithstanding any provisions to the contrary in
this Agreement or in any Note, the aggregate of all interest, and
any other charges or consideration constituting interest under
Applicable Interest Law, that is taken, reserved, contracted for,
charged or received pursuant to this Agreement or any Notes shall
under no circumstances exceed the maximum amount of interest
allowed by the Applicable Interest Law. If any interest in
excess of such amount is provided for in this Agreement or in any
Note, then in such event
(i) the provisions of this Section 8.6(d) shall
govern and control,
(ii) the Company shall not be obligated to pay the
amount of such interest to the extent that it is in
excess of the maximum amount of interest allowed by the
Applicable Interest Law,
(iii) any interest paid on any Notes which is in
excess of what is allowed by the Applicable Interest
Law shall be deemed a mistake and cancelled
34
automatically and, if theretofore paid, shall be
credited to the outstanding principal amount of such
Notes, pro rata, by each holder of such Notes, and
(iv) the effective rate of interest on the Notes
shall be automatically subject to reduction to the
Maximum Legal Rate of Interest.
If at any time thereafter, the Maximum Legal Rate of
Interest is increased, then, to the extent that it shall be
permissible under Applicable Interest Law, the Company shall
forthwith pay to the holders of the Notes subject to a prior
reduction, all amounts (or the permissible part thereof) of such
excess interest that the holders of such Notes would have been
entitled to receive pursuant to the terms of this Agreement and
such Notes had such increased Maximum Legal Rate of Interest been
in effect at all times when such excess interest accrued. To the
extent permitted by the Applicable Interest Law, all sums paid or
agreed to be paid to the holders of any Notes for the use,
forbearance or detention of the indebtedness evidenced by the
Notes shall be amortized, prorated, allocated and spread
throughout the full term of such Notes.
9. AFFIRMATIVE COVENANTS.
The Company covenants that so long as any of the Notes are
outstanding:
9.1 Compliance with Law.
The Company will and will cause each of its Subsidiaries to
comply with all laws, ordinances or governmental rules or regulations
to which each of them is subject, and will obtain and maintain in
effect all licenses, certificates, permits, franchises and other
governmental authorizations necessary to the ownership of their
respective properties or to the conduct of their respective
businesses, in each case to the extent necessary to ensure that non-
compliance with such laws, ordinances or governmental rules or
regulations or failures to obtain or maintain in effect such licenses,
certificates, permits, franchises and other governmental
authorizations could not, individually or in the aggregate, reasonably
be expected to have a Material Adverse Effect.
9.2 Insurance.
The Company will maintain, and will cause each Subsidiary to
maintain, insurance coverage in such forms and amounts and against
such risks, including without limitation insurance with respect to its
property, the operation thereof and its business against casualties,
35
contingencies and risks and insurance against loss or damage from such
hazard and risks to the Person or property of others, as are customary
for corporations similarly situated and engaged in the same or a
similar business and owning and operating similar properties. All
such insurance shall be carried with (i) CIGNA or an affiliate
thereof, or (ii) financially sound and reputable insurers rated A or
better by A.M. Best Company, Inc.
9.3 Maintenance of Properties.
The Company will and will cause each of its Subsidiaries to
maintain and keep, or cause to be maintained and kept, their
respective properties in good repair, working order and condition
(other than ordinary wear and tear), so that the business carried on
in connection therewith may be properly conducted at all times,
provided that this Section shall not prevent the Company or any
Subsidiary from discontinuing the operation and the maintenance of any
of its properties if such discontinuance is desirable in the conduct
of its business and the Company has concluded that such discontinuance
could not, individually or in the aggregate, reasonably be expected to
have a Material Adverse Effect.
9.4 Payment of Taxes and Claims.
The Company will and will cause each of its Subsidiaries to file
all tax returns required to be filed in any jurisdiction and to pay
and discharge all taxes shown to be due and payable on such returns
and all other taxes, assessments, governmental charges, or levies
imposed on them or any of their properties, assets, income or
franchises, to the extent such taxes, assessments, charges or levies
have become due and payable and before they have become delinquent and
all claims for which sums have become due and payable that have or
might become a Lien on properties or assets of the Company or any
Subsidiary, provided that neither the Company nor any Subsidiary need
pay any such tax or assessment or claims if (a) the amount,
applicability or validity thereof is contested by the Company or such
Subsidiary on a timely basis in good faith and in appropriate
proceedings, and the Company or a Subsidiary has established adequate
reserves therefor in accordance with GAAP on the books of the Company
or such Subsidiary or (b) the nonpayment of all such taxes,
assessments, charges and levies in the aggregate could not reasonably
be expected to have a Material Adverse Effect.
9.5 Corporate Existence, etc.
The Company will at all times preserve and keep in full force and
effect its corporate existence. Subject to paragraphs E and F of
Schedule 10.1, the Company will at all times preserve and keep in full
36
force and effect the corporate existence of each of its Subsidiaries
(unless merged into the Company or a Subsidiary) and all rights and
franchises of the Company and its Subsidiaries unless, in the good
faith judgment of the Company, the termination of or failure to
preserve and keep in full force and effect such corporate existence,
right or franchise could not, individually or in the aggregate, have a
Material Adverse Effect.
9.6 Subsidiaries as Guarantors.
The Company will, not later than three (3) Business Days after
any Person becomes a Subsidiary after the Closing Date or any
Subsidiary becomes an obligor under either of the Bank Credit
Agreements or an obligor with respect to any other Indebtedness, cause
such Person to execute and deliver:
(a) to each holder of Notes, manually signed originals
of an acknowledgment and agreement in respect of the Subsidiary
Guaranty in the form of Exhibit A thereto, and
(b) to the Collateral Agent, manually signed originals
(with copies thereof to any holder of Notes upon such holder's
request) of all Security Documents and such Uniform Commercial
Code financing statements and other instruments and documents as
shall be necessary to perfect the Liens against Property of such
Person which is Collateral.
The foregoing items shall be accompanied by (i) a written notice,
signed by a Senior Financial Officer of the Company, making reference
to this Section of this Agreement, stating that such Person is
required to become a Subsidiary Guarantor and specifying the manner in
which such Person shall have become a Subsidiary Guarantor, the
jurisdiction of incorporation of such Person and the percentage of its
capital stock owned by the Company and the other Subsidiaries, (ii)
copies of the corporate charter and bylaws of such Person and
resolutions of the board of directors of such Person authorizing its
execution and delivery of the foregoing agreements and the
transactions contemplated thereby (in each case, certified as correct
and complete copies by the secretary or an assistant secretary of such
Person) and (iii) a legal opinion, satisfactory in form, scope and
substance to the Required Holders, of independent counsel to the
effect (A) that the Financing Documents to which such Person is then
becoming a party are enforceable in accordance with their terms and
(B) that the Liens against Property which is Collateral shall have
been created and perfected in accordance with the requirements of the
Security Documents.
37
9.7 Current Public Information.
The Company will at all times have on file with the Securities
and Exchange Commission "current public information" of the type
required in order to make Rule 144 under the Securities Act available
to the holders of its Common Stock.
10. NEGATIVE AND FINANCIAL COVENANTS.
10.1 Negative Covenants.
The Company covenants that so long as any of the Notes are
outstanding that it shall comply with each of the negative covenants
set forth in Schedule 10.1 which covenants are incorporated herein by
this reference.
10.2 Financial Covenants.
The Company covenants that at all times after June 30, 1998 and
so long as any of the Notes are outstanding that it shall comply with
each of the financial covenants set forth in Schedule 10.2 which
covenants are incorporated herein by this reference.
10.3 Transactions with Affiliates.
The Company will not, and will not permit any Subsidiary to,
enter into directly or indirectly any transaction or group of related
transactions (including, without limitation, the purchase, lease, sale
or exchange of properties of any kind or the rendering of any service)
with any Affiliate (other than the Company or another Subsidiary),
except in the ordinary course and pursuant to the reasonable
requirements of the Company's or such Subsidiary's business and upon
fair and reasonable terms no less favorable to the Company or such
Subsidiary than would be obtainable in a comparable arm's-length
transaction with a Person not an Affiliate.
10.4 Inactive Subsidiaries.
The Company will not, at any time, permit any Inactive Subsidiary
to
(a) own any Property,
(b) conduct any business or business operations, or
(c) be or become obligated in respect of any
liabilities or other obligations;
provided; that Rockingham Poultry, Inc (VI) may maintain a bank
account, so long as the maximum amount on deposit therein does not at
38
any time exceed $15,000, and conduct its foreign sales operations.
11. EVENTS OF DEFAULT.
An "Event of Default" shall exist if any of the following
conditions or events shall occur and be continuing:
(a) the Company defaults in the payment of any principal on
any Note when the same becomes due and payable, whether at
maturity or at a date fixed for prepayment or by declaration or
otherwise; or
(b) the Company defaults in the payment of any interest on
any Note for more than five (5) Business Days after the same
becomes due and payable; or
(c) the Company defaults in the performance of or
compliance with any term contained in any of Section 7.1(e),
Section 7.1(i), Section 7.1(j), Schedule 10.1 or Schedule 10.2,
inclusive; or
(d) the Company defaults in the performance of or
compliance with any term contained herein (other than those
referred to in paragraphs (a), (b) and (c) of this Section 11)
and such default is not remedied within 30 days after the earlier
of (i) a Responsible Officer obtaining actual knowledge of such
default and (ii) the Company receiving written notice of such
default from any holder of a Note; or
(e) any representation or warranty made in writing by
or on behalf of the Company or any Subsidiary Guarantor, or
by any officer of the Company or any Subsidiary Guarantor, in
this Agreement, any other Financing Document or in any writing
furnished in connection with the transactions contemplated hereby
proves to have been false or incorrect in any material respect on
the date as of which made; or
(f) (i) the Company or any Subsidiary is in default
(as principal or as guarantor or other surety) in the
payment of any principal of or premium or make-whole
amount or interest on any Indebtedness (other than
Indebtedness under this Agreement and the Notes) beyond
any period of grace provided with respect thereto, that
individually or together with such other Indebtedness
as to which any such failure exists has an aggregate
outstanding principal amount of at least Three Million
Dollars ($3,000,000), or
(ii) the Company or any Subsidiary is in default
in the performance of or compliance with any term of
39
any Indebtedness (other than Indebtedness under this
Agreement and the Notes), that individually or together
with such other Indebtedness as to which any such
failure exists has an aggregate outstanding principal
amount of at least Three Million Dollars ($3,000,000),
or of any mortgage, indenture or other agreement
relating thereto, or any other condition exists, and as
a consequence of such default or condition such
Indebtedness has become, or has been declared (or one
or more Persons are entitled to declare such
Indebtedness to be), due and payable before its stated
maturity or before its regularly scheduled dates of
payment, or
(iii) as a consequence of the occurrence or
continuation of any event or condition (other than the
passage of time or the right of the holder of
Indebtedness to convert such Indebtedness into equity
interests),
(A) the Company or any Subsidiary has become
obligated to purchase or repay Indebtedness before
its regular maturity or before its regularly
scheduled dates of payment in an aggregate
outstanding principal amount of at least Three
Million Dollars ($3,000,000), or
(B) one or more Persons have the right to
require the Company or any Subsidiary so to
purchase or repay such Indebtedness; or
(g) the Company or any Subsidiary (i) is generally not
paying, or admits in writing its inability to pay, its debts
as they become due, (ii) files, or consents by answer or
otherwise to the filing against it of, a petition for relief
or reorganization or arrangement or any other petition in
bankruptcy, for liquidation or to take advantage of any
bankruptcy, insolvency, reorganization, moratorium or other
similar law of any jurisdiction, (iii) makes an assignment for
the benefit of its creditors, (iv) consents to the appointment of
a custodian, receiver, trustee or other officer with similar
powers with respect to it or with respect to any substantial part
of its property, (v) is adjudicated as insolvent or to be
liquidated, or (vi) takes corporate action for the purpose of any
of the foregoing; or
(h) a court or Governmental Authority of competent
jurisdiction enters an order appointing, without consent by
the Company or any Subsidiary, a custodian, receiver, trustee or
other officer with similar powers with respect to the Company or
any Subsidiary or with respect to any substantial part of the
40
property of the Company or any Subsidiary, or constituting an
order for relief or approving a petition for relief or
reorganization or any other petition in bankruptcy or for
liquidation or to take advantage of any bankruptcy or insolvency
law of any jurisdiction, or ordering the dissolution, winding-up
or liquidation of the Company or any Subsidiary, or any such
petition shall be filed against the Company or any Subsidiary and
such petition shall not be dismissed within 60 days; or
(i) a final judgment or judgments for the payment of money
aggregating in excess of Two Million Five Hundred Thousand
Dollars ($2,500,000) are rendered against one or more of the
Company and its Subsidiaries and which judgments are not, within
30 days after entry thereof, bonded, discharged or stayed pending
appeal, or are not discharged within 30 days after the expiration
of such stay; or
(i) the Subsidiary Guaranty shall cease to be in
full force and effect or shall be declared by a court
or Governmental Authority of competent jurisdiction to
be void, voidable or unenforceable against any
Subsidiary Guarantor;
(ii) the validity or enforceability of the
Subsidiary Guaranty against any Subsidiary Guarantor
shall be contested by any such Subsidiary Guarantor, or
any Subsidiary or Affiliate thereof; or
(iii) any Subsidiary Guarantor, or any Subsidiary
or Affiliate thereof, shall deny that such Subsidiary
Guarantor has any further liability or obligation under
the Subsidiary Guaranty; or
(k) any person or group of persons (within the meaning
of Section 13(d) of the Exchange Act) other than the current
board of directors of the Company, shall obtain ownership or
control in one or more series of transactions of more than fifty
percent (50%) of the Common Stock and fifty percent (50%) of the
voting power of the Company entitled to vote in the election of
members of the board of directors of the Company; or
(l) any security interest or Lien granted to the
Collateral Agent pursuant to the Security Documents shall fail at
any time to constitute a perfected first priority security
interest in or Lien on any material portion of the Collateral
subject only to Liens permitted thereunder, or any of the
Security Documents shall cease to be in full force and effect in
whole or in part for any reason whatsoever except as specified
41
therein, provided that no Event of Default shall have occurred
pursuant to this subparagraph (l) if the Company, within five (5)
Business Days of receiving notice from the Collateral Agent,
takes such steps as are necessary to create a valid and perfected
first priority Lien in such Collateral in favor of the Collateral
Agent; or
(m)if (i) any Plan shall fail to satisfy the
minimum funding standards of ERISA or the Code for any
plan year or part thereof or a waiver of such standards
or extension of any amortization period is sought or
granted under section 412 of the Code,
(ii) a notice of intent to terminate any Plan
shall have been or is reasonably expected to be
filed with the PBGC or the PBGC shall have
instituted proceedings under section 4042 of ERISA
to terminate or appoint a trustee to administer
any Plan or the PBGC shall have notified the
Company or any ERISA Affiliate that a Plan may
become a subject of any such proceedings,
(iii) the aggregate amount of "unfunded
benefit liabilities" (within the meaning of
section 4001(a)(18) of ERISA) under all Plans,
determined in accordance with Title IV of ERISA,
shall exceed Five Million Dollars ($5,000,000),
(iv) the Company or any ERISA Affiliate shall
have incurred or is reasonably expected to incur
any liability pursuant to Title I or IV of ERISA
or the penalty or excise tax provisions of the
Code relating to employee benefit plans (as
defined in section 3 of ERISA),
(v) the Company or any ERISA Affiliate
withdraws from any Multiemployer Plan, or
(vi) the Company or any Subsidiary
establishes or amends any employee welfare benefit
plan (as defined in section 3 of ERISA) that
provides post-employment welfare benefits in a
manner that would increase the liability of the
Company or any Subsidiary thereunder;
and any such event or events described in clauses (i)
through (vi) above, either individually or together with any
other such event or events, could reasonably be expected to have
a Material Adverse Effect.
42
12. REMEDIES ON DEFAULT, ETC.
12.1 Acceleration.
(a) If an Event of Default with respect to the Company
described in paragraph (g) or paragraph (h) of Section 11
(other than an Event of Default described in clause (i) of
paragraph (g) or described in clause (vi) of paragraph (g) by
virtue of the fact that such clause encompasses clause (i) of
paragraph (g)) has occurred, all the Notes then outstanding shall
automatically become immediately due and payable.
(b) If any other Event of Default has occurred and is
continuing, any holder or holders of more than 35% in principal
amount of the Notes at the time outstanding may at any time at
its or their option, by notice or notices to the Company, declare
all the Notes then outstanding to be immediately due and payable.
(c) If any Event of Default described in paragraph (a)
or (b) of Section 11 has occurred and is continuing, any
holder or holders of Notes at the time outstanding affected
by such Event of Default may at any time, at its or their
option, by notice or notices to the Company, declare all the
Notes held by it or them to be immediately due and payable.
Upon any Notes becoming due and payable under this Section 12.1,
whether automatically or by declaration, such Notes will forthwith
mature and the entire unpaid principal amount of such Notes, plus all
accrued and unpaid interest thereon, shall all be immediately due and
payable, in each and every case without presentment, demand, protest
or further notice, all of which are hereby waived.
12.2 Other Remedies.
If any Default or Event of Default has occurred and is
continuing, and irrespective of whether any Notes have become or have
been declared immediately due and payable under Section 12.1, the
holder of any Note at the time outstanding may proceed to protect and
enforce the rights of such holder by an action at law, suit in equity
or other appropriate proceeding, whether for the specific performance
of any agreement contained herein or in any Note, or for an injunction
against a violation of any of the terms hereof or thereof, or in aid
of the exercise of any power granted hereby or thereby or by law or
otherwise.
43
12.3 Rescission.
At any time after any Notes have been declared due and payable
pursuant to clause (b) or clause (c) of Section 12.1, the holders of
not less than 67% in principal amount of the Notes then outstanding,
by written notice to the Company, may rescind and annul any such
declaration and its consequences if (a) the Company has paid all
overdue interest on the Notes, all principal of, and all interest on
such overdue principal, and (to the extent permitted by applicable
law), except as otherwise provided in Section 8.6(b), any overdue
interest in respect of the Notes, at the Default Rate, (b) all Events
of Default and Defaults, other than non-payment of amounts that have
become due solely by reason of such declaration, have been cured or
have been waived pursuant to Section 17, and (c) no judgment or decree
has been entered for the payment of any monies due pursuant hereto or
to the Notes. No rescission and annulment under this Section 12.3
will extend to or affect any subsequent Event of Default or Default or
impair any right consequent thereon.
12.4 No Waivers or Election of Remedies, Expenses, etc.
No course of dealing and no delay on the part of any holder of
any Note in exercising any right, power or remedy shall operate as a
waiver thereof or otherwise prejudice such holder's rights, powers or
remedies. No right, power or remedy conferred by this Agreement or by
any Note upon any holder thereof shall be exclusive of any other
right, power or remedy referred to herein or therein or now or
hereafter available at law, in equity, by statute or otherwise.
Without limiting the obligations of the Company under Section 15, the
Company will pay to the holder of each Note on demand such further
amount as shall be sufficient to cover all costs and expenses of such
holder incurred in any enforcement or collection under this Section
12, including, without limitation, reasonable attorneys' fees,
expenses and disbursements.
13. REGISTRATION; EXCHANGE; SUBSTITUTION OF NOTES.
13.1 Registration of Notes.
The Company shall keep at its principal executive office a
register for the registration and registration of transfers of Notes.
The name and address of each holder of one or more Notes, each
transfer thereof and the name and address of each transferee of one or
more Notes shall be registered in such register. Prior to due
presentment for registration of transfer, the Person in whose name any
Note shall be registered shall be deemed and treated as the owner and
holder thereof for all purposes hereof, and the Company shall not be
affected by any notice or knowledge to the contrary. The Company
44
shall give to any holder of a Note that is an Institutional Investor
promptly upon request therefor, a complete and correct copy of the
names and addresses of all registered holders of Notes.
13.2 Transfer and Exchange of Notes.
Upon surrender of any Note at the principal executive office of
the Company for registration of transfer or exchange (and in the case
of a surrender for registration of transfer, duly endorsed or
accompanied by a written instrument of transfer duly executed by the
registered holder of such Note or his attorney duly authorized in
writing and accompanied by the address for notices of each transferee
of such Note or part thereof), the Company shall execute and deliver,
at the Company's expense (except as provided below), one or more new
Notes (as requested by the holder thereof) in exchange therefor, in an
aggregate principal amount equal to the unpaid principal amount of the
surrendered Note. Each such new Note shall be payable to such Person
as such holder may request and shall be substantially in the form of
Exhibit 1. Each such new Note shall be dated and bear interest from
the date to which interest shall have been paid on the surrendered
Note or dated the date of the surrendered Note if no interest shall
have been paid thereon. The Company may require payment of a sum
sufficient to cover any stamp tax or governmental charge imposed in
respect of any such transfer of Notes. Notes shall not be transferred
in denominations of less than One Hundred Thousand Dollars ($100,000),
provided that if necessary to enable the registration of transfer by a
holder of its entire holding of Notes, one Note may be in a
denomination of less than One Hundred Thousand Dollars ($100,000).
Any transferee, by its acceptance of a Note registered in its name (or
the name of its nominee), shall be deemed to have made the
representation set forth in Section 6.2.
13.3 Replacement of Notes.
Upon receipt by the Company of evidence reasonably satisfactory
to it of the ownership of and the loss, theft, destruction or
mutilation of any Note (which evidence shall be, in the case of an
Institutional Investor, notice from such Institutional Investor of
such ownership and such loss, theft, destruction or mutilation), and
(a) in the case of loss, theft or destruction, of
indemnity reasonably satisfactory to it (provided that if the
holder of such Note is, or is a nominee for, an original
purchaser or a Qualified Institutional Buyer, such Person's own
unsecured agreement of indemnity shall be deemed to be
satisfactory), or
45
(b) in the case of mutilation, upon surrender and
cancellation thereof,
the Company at its own expense shall execute and deliver, in lieu
thereof, a new Note, dated and bearing interest from the date to which
interest shall have been paid on such lost, stolen, destroyed or
mutilated Note or dated the date of such lost, stolen, destroyed or
mutilated Note if no interest shall have been paid thereon.
14. PAYMENTS ON NOTES.
14.1 Place of Payment.
Subject to Section 14.2, payments of principal, and interest
becoming due and payable on the Notes shall be made in New York, New
York at the principal office of The Chase Manhattan Bank in such
jurisdiction. The Company may at any time, by notice to each holder
of a Note, change the place of payment of the Notes so long as such
place of payment shall be either the principal office of the Company
in such jurisdiction or the principal office of a bank or trust
company in such jurisdiction.
14.2 Home Office Payment.
So long as you or your nominee shall be the holder of any Note,
and notwithstanding anything contained in Section 14.1 or in such Note
to the contrary, the Company will pay all sums becoming due on such
Note for principal and interest by the method and at the address
specified for such purpose below your name in Schedule A, or by such
other method or at such other address as you shall have from time to
time specified to the Company in writing for such purpose, without the
presentation or surrender of such Note or the making of any notation
thereon, except that upon written request of the Company made
concurrently with or reasonably promptly after payment or prepayment
in full of any Note, you shall surrender such Note for cancellation,
reasonably promptly after any such request, to the Company at its
principal executive office or at the place of payment most recently
designated by the Company pursuant to Section 14.1. Prior to any sale
or other disposition of any Note held by you or your nominee you will,
at your election, either endorse thereon the amount of principal paid
thereon and the last date to which interest has been paid thereon or
surrender such Note to the Company in exchange for a new Note or Notes
pursuant to Section 13.2. The Company will afford the benefits of
this Section 14.2 to any Institutional Investor that is the direct or
indirect transferee of any Note purchased by you under this Agreement
and that has made the same agreement relating to such Note as you have
made in this Section 14.2.
46
15. EXPENSES, ETC.
15.1 Transaction Expenses.
Whether or not the transactions contemplated hereby are
consummated, the Company will pay all costs and expenses (including
reasonable attorneys' fees of a special counsel and, if reasonably
required, local or other counsel) incurred by you and each other
Purchaser or holder of a Note in connection with such transactions and
in connection with any amendments, waivers or consents under or in
respect of this Agreement or the Notes (whether or not such amendment,
waiver or consent becomes effective), including, without limitation:
(a) the costs and expenses incurred in enforcing or defending (or
determining whether or how to enforce or defend) any rights under this
Agreement, the Notes or any other Financing Document or in responding
to any subpoena or other legal process or informal investigative
demand issued in connection with this Agreement, the Notes or any
other Financing Document, or by reason of being a holder of any Note,
(b) the costs and expenses, including attorney's and financial
advisors' fees and costs and expenses, incurred in connection with the
insolvency or bankruptcy of the Company or any Subsidiary or in
connection with any work-out or restructuring of the transactions
contemplated hereby and by the Notes and (c) the costs and expenses
(including travel expenses) incurred in connection with the review,
evaluation, negotiation, analysis, due diligence investigation or
other activity related to any of the Financing Documents and the
holders' and the Collateral Agent's rights and remedies thereunder
(including any such activity occurring during any work-out or
restructuring of the transactions contemplated hereby and by the Notes
or during a bankruptcy, insolvency, reorganization or similar
proceeding). The Company will pay, and will save you and each other
holder of a Note harmless from, all claims in respect of any fees,
costs or expenses if any, of brokers and finders (other than those
retained by you).
15.2 Survival.
The obligations of the Company under this Section 15 will survive
the payment or transfer of any Note, the enforcement, amendment or
waiver of any provision of this Agreement or the Notes, and the
termination of this Agreement.
16. SURVIVAL OF REPRESENTATIONS AND WARRANTIES; ENTIRE AGREEMENT.
All representations and warranties contained herein shall survive
the execution and delivery of this Agreement and the Notes, the
purchase or transfer by you of any Note or portion thereof or interest
therein and the payment of any Note, and may be relied upon by any
47
subsequent holder of a Note, regardless of any investigation made at
any time by or on behalf of you or any other holder of a Note. All
statements contained in any certificate or other instrument delivered
by or on behalf of the Company pursuant to this Agreement shall be
deemed representations and warranties of the Company under this
Agreement.
17. AMENDMENT AND WAIVER.
17.1 Requirements.
This Agreement and the Notes may be amended, and the observance
of any term hereof or of the Notes may be waived (either retroactively
or prospectively), with (and only with) the written consent of the
Company and the Required Holders, except that (a) no amendment or
waiver of any of the provisions of any of Sections 1, 2, 3, 4, 5, 6
and 21, or any defined term (as it is used therein), will be effective
as to you unless consented to by you in writing, and (b) no such
amendment or waiver may, without the written consent of the holder of
each Note at the time outstanding affected thereby, (i) subject to the
provisions of Section 12 relating to acceleration or rescission,
change the amount or time of any prepayment or payment of principal
of, or reduce the rate or change the time of payment or method of
computation of interest on the Notes, (ii) change the percentage of
the principal amount of the Notes the holders of which are required to
consent to any such amendment or waiver, or (iii) amend any of
Sections 8, 11(a), 11(b), 12, 17 and 20.
17.2 Solicitation of Holders of Notes.
(a) Solicitation. The Company will provide each
holder of the Notes (irrespective of the amount of Notes then
owned by it) with sufficient information, sufficiently far in
advance of the date a decision is required, to enable such holder
to make an informed and considered decision with respect to any
proposed amendment, waiver or consent in respect of any of the
provisions hereof or of the Notes. The Company will deliver
executed or true and correct copies of each amendment, waiver or
consent effected pursuant to the provisions of this Section 17 to
each holder of outstanding Notes promptly following the date on
which it is executed and delivered by, or receives the consent or
approval of, the requisite holders of Notes.
(b) Payment. The Company will not directly or indirectly
pay or cause to be paid any remuneration, whether by way of
supplemental or additional interest, fee or otherwise, or grant
any security, to any holder of Notes as consideration for or as
an inducement to the entering into by any holder of Notes of any
48
waiver or amendment of any of the terms and provisions hereof
unless such remuneration is concurrently paid, or security is
concurrently granted, on the same terms, ratably to each holder
of Notes then outstanding even if such holder did not consent to
such waiver or amendment.
17.3 Binding Effect, etc.
Any amendment or waiver consented to as provided in this Section
17 applies equally to all holders of Notes and is binding upon them
and upon each future holder of any Note and upon the Company without
regard to whether such Note has been marked to indicate such amendment
or waiver. No such amendment or waiver will extend to or affect any
obligation, covenant, agreement, Default or Event of Default not
expressly amended or waived or impair any right consequent thereon.
No course of dealing between the Company and the holder of any Note
nor any delay in exercising any rights hereunder or under any Note
shall operate as a waiver of any rights of any holder of such Note.
As used herein, the term "this Agreement" and references thereto shall
mean this Agreement as it may from time to time be amended or
supplemented.
17.4 Notes held by Company, etc.
Solely for the purpose of determining whether the holders of the
requisite percentage of the aggregate principal amount of Notes then
outstanding approved or consented to any amendment, waiver or consent
to be given under this Agreement or the Notes, or have directed the
taking of any action provided herein or in the Notes to be taken upon
the direction of the holders of a specified percentage of the
aggregate principal amount of Notes then outstanding, Notes directly
or indirectly owned by the Company or any of its Affiliates shall be
deemed not to be outstanding.
18. NOTICES.
All notices and communications provided for hereunder shall be in
writing and sent (a) by telecopy if the sender on the same day sends a
confirming copy of such notice by a recognized overnight delivery
service (charges prepaid), or (b) by registered or certified mail with
return receipt requested (postage prepaid), or (c) by a recognized
overnight delivery service (with charges prepaid). Any such notice
must be sent:
(i) if to you or your nominee, to you or it at the
address specified for such communications in Schedule A, or
at such other address as you or it shall have specified to the
Company in writing,
49
(ii) if to any other holder of any Note, to such holder
at such address as such other holder shall have specified to
the Company in writing, or
(iii) if to the Company, to the Company at its address
set forth at the beginning hereof (or if by United States
Postal Service to X.X. Xxx 0000, Xxxxxxxx, Xxxxxxxx 00000) to the
attention of Xxxxxx Xxxxxx, telecopier: (000) 000-0000, or at
such other address as the Company shall have specified to the
holder of each Note in writing.
Notices under this Section 18 will be deemed given only when actually
received.
19. REPRODUCTION OF DOCUMENTS.
This Agreement and all documents relating hereto, including,
without limitation, (a) consents, waivers and modifications that may
hereafter be executed, (b) documents received by you at the Closing
(except the Notes themselves), and (c) financial statements,
certificates and other information previously or hereafter furnished
to you, may be reproduced by you by any photographic, photostatic,
microfilm, microcard, miniature photographic or other similar process
and you may destroy any original document so reproduced. The Company
agrees and stipulates that, to the extent permitted by applicable law,
any such reproduction shall be admissible in evidence as the original
itself in any judicial or administrative proceeding (whether or not
the original is in existence and whether or not such reproduction was
made by you in the regular course of business) and any enlargement,
facsimile or further reproduction of such reproduction shall likewise
be admissible in evidence. This Section 19 shall not prohibit the
Company or any other holder of Notes from contesting any such
reproduction to the same extent that it could contest the original, or
from introducing evidence to demonstrate the inaccuracy of any such
reproduction.
20. SUBSTITUTION OF PURCHASER.
You shall have the right to substitute any one of your Affiliates
as the purchaser of the Notes that you have agreed to purchase
hereunder, by written notice to the Company, which notice shall be
signed by both you and such Affiliate, shall contain such Affiliate's
agreement to be bound by this Agreement and shall contain a
confirmation by such Affiliate of the accuracy with respect to it of
the representations set forth in Section 6. Upon receipt of such
notice, wherever the word "you" is used in this Agreement (other than
in this Section 20), such word shall be deemed to refer to such
Affiliate in lieu of you. In the event that such Affiliate is so
substituted as a purchaser hereunder and such Affiliate thereafter
50
transfers to you all of the Notes then held by such Affiliate, upon
receipt by the Company of notice of such transfer, wherever the word
"you" is used in this Agreement (other than in this Section 20), such
word shall no longer be deemed to refer to such Affiliate, but shall
refer to you, and you shall have all the rights of an original holder
of the Notes under this Agreement.
21. MISCELLANEOUS.
21.1 Successors and Assigns.
All covenants and other agreements contained in this Agreement by
or on behalf of any of the parties hereto bind and inure to the
benefit of their respective successors and assigns (including, without
limitation, any subsequent holder of a Note) whether so expressed or
not.
21.2 Payments Due on Non-Business Days; When Payments Deemed
Received.
(a)Payments Due on Non-Business DaysAnything in this
Agreement or the Notes to the contrary notwithstanding, any
payment of principal of or interest on any Note that is due
on a date other than a Business Day shall be made on the next
succeeding Business Day without including the additional days
elapsed in the computation of the interest payable on such next
succeeding Business Day.
(b) Payments, When ReceivedAny payment to be made to the
holders of Notes hereunder or under the Notes shall be deemed to
have been made on the Business Day such payment actually becomes
available to such holder at such holder's bank prior to 12:00
noon (local time of such bank).
21.3 Severability.
Any provision of this Agreement that is prohibited or
unenforceable in any jurisdiction shall, as to such jurisdiction, be
ineffective to the extent of such prohibition or unenforceability
without invalidating the remaining provisions hereof, and any such
prohibition or unenforceability in any jurisdiction shall (to the full
extent permitted by law) not invalidate or render unenforceable such
provision in any other jurisdiction.
21.4 Construction.
Each covenant contained herein shall be construed (absent express
provision to the contrary) as being independent of each other covenant
contained herein, so that compliance with any one covenant shall not
(absent such an express contrary provision) be deemed to excuse
51
compliance with any other covenant. Where any provision herein refers
to action to be taken by any Person, or which such Person is
prohibited from taking, such provision shall be applicable whether
such action is taken directly or indirectly by such Person.
21.5 Counterparts.
This Agreement may be executed in any number of counterparts,
each of which shall be an original but all of which together shall
constitute one instrument. Each counterpart may consist of a number
of copies hereof, each signed by less than all, but together signed by
all, of the parties hereto.
21.6 Governing Law.
THIS AGREEMENT SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE
WITH, AND THE RIGHTS OF THE PARTIES SHALL BE GOVERNED BY, THE LAW OF
THE STATE OF NEW YORK EXCLUDING CHOICE-OF-LAW PRINCIPLES OF THE LAW OF
SUCH STATE THAT WOULD REQUIRE THE APPLICATION OF THE LAWS OF A
JURISDICTION OTHER THAN SUCH STATE.
[Remainder of page intentionally blank. Next page is signature page.]
52
If you are in agreement with the foregoing, please sign the
form of agreement on the accompanying counterpart of this Agreement
and return it to the Company, whereupon the foregoing shall become a
binding agreement between you and the Company.
Very truly yours,
WLR FOODS, INC
By:__/s/ Xxxxxx X. Ritter__
Name: Xxxxxx X. Xxxxxx
Title:Vice President
The foregoing is hereby
agreed to as of the
date thereof.
NATIONWIDE LIFE INSURANCE COMPANY
By:__/s/ Xxxxx X. Pruden__
Name: Xxxxx X. Xxxxxx
Title:Vice President
Municipal Securities
NATIONWIDE LIFE INSURANCE COMPANY SEPARATE ACCOUNT OH
By:__/s/ Xxxxx X. Pruden__
Name: Xxxxx X. Xxxxxx
Title:Vice President
Municipal Securities
EMPLOYERS LIFE INSURANCE COMPANY OF WAUSAU
By:__/s/ Xxxxx X. Pruden__
Name: Xxxxx X. Xxxxxx
Title:Attorney-In-Fact
53
SECURITY LIFE INSURANCE COMPANY
By: MIMLIC Asset Management Company
By:__/s/ Xxxxxx X. Betlej__
Name: Xxxxxx X. Xxxxxx
Title:Vice President
GREAT WESTERN INSURANCE COMPANY
By: MIMLIC Asset Management Company
By:__/s/ Xxxxxx X. Betlej__
Name: Xxxxxx X. Xxxxxx
Title:Vice President
NATIONAL TRAVELERS LIFE COMPANY
By: MIMLIC Asset Management Company
By:__/s/ Xxxxxx X. Betlej__
Name: Xxxxxx X. Xxxxxx
Title:Vice President
PIONEER MUTUAL LIFE INSURANCE COMPANY
By: MIMLIC Asset Management Company
By:__/s/ Xxxxxx X. Betlej__
Name: Xxxxxx X. Xxxxxx
Title:Vice President
GUARANTEE RESERVE LIFE INSURANCE COMPANY
By: MIMLIC Asset Management Company
By:__/s/ R. Worthing__
Name: X. Xxxxxxxx
Title:Vice President
54
THE CATHOLIC AID ASSOCIATION
By: MIMLIC Asset Management Company
By:__/s/ R. Worthing__
Name: X. Xxxxxxxx
Title:Vice President
MUTUAL TRUST LIFE INSURANCE COMPANY
By: MIMLIC Asset Management Company
By:__/s/ R. Worthing__
Name: X. Xxxxxxxx
Title:Vice President
FEDERATED MUTUAL INSURANCE COMPANY
By: MIMLIC Asset Management Company
By:__/s/ R. Worthing__
Name: X. Xxxxxxxx
Title:Vice President
FEDERATED LIFE INSURANCE COMPANY
By: MIMLIC Asset Management Company
By:__/s/ Xxxxx Haugland__
Name: Xxxxx Xxxxxxxx
Title:Vice President
STATE MUTUAL INSURANCE COMPANY
By: MIMLIC Asset Management Company
By:__/s/ Xxxxx Haugland__
Name: Xxxxx Xxxxxxxx
Title:Vice President
55
COLORADO BANKERS LIFE INSURANCE COMPANY
By: MIMLIC Asset Management Company
By:__/s/ Xxxxx Haugland__
Name: Xxxxx Xxxxxxxx
Title:Vice President
THE RELIABLE LIFE INSURANCE COMPANY
& ASSOCIATES RETIREMENT PLAN
By: MIMLIC Asset Management Company
By:__/s/ Xxxxx Haugland__
Name: Xxxxx Xxxxxxxx
Title:Vice President
THE MINNESOTA MUTUAL LIFE INSURANCE COMPANY
By: MIMLIC Asset Management Company
By:__/s/ Xxxxxx X. Laude__
Name: Xxxxxx Xxxxx
Title:Vice President
MIMLIC FUNDING, INC.
By: MIMLIC Asset Management Company
By:__/s/ Xxxxxx X. Laude__
Name: Xxxxxx Xxxxx
Title:Vice President
TEXAS LIFE INSURANCE COMPANY
By:__/s/ Xxxxxxx Scully__
Name: Xxxxxxx Xxxxxx
Title:Investment Officer
00
XXXXXXXX XXXX CREDIT, ACA
By:__/s/ Xxxxxxx X. Reeves__
Name: Xxxxxxx X. Xxxxxx
Title:President
THE RELIABLE LIFE INSURANCE COMPANY
By: MIMLIC Asset Management Company
By:__/s/ Xxxxxx Orbison__
Name: Xxxxxx Xxxxxxx
Title:Vice President
57
