Amendment No. 1
This Amendment No. 1 (the "Amendment"), effective this 15th day of March 2004,
is by and between Xxxxxx Canning Company, a Colorado corporation ("Xxxxxx"), and
Hoopeston Foods Denver Corp., a Delaware corporation ("Hoopeston").
Recitals
--------
A. Effective as of January 26, 2001, Xxxxxx and Hoopeston entered into a
business transaction concerning the production facility of Xxxxxx that is
located at 0000 Xxxx Xxxxxx, Xxxxxx, Xxxxxxxx, and the business conducted
therein. This transaction was effected through execution of various agreements,
including a Lease Agreement, Equipment Lease, Exclusive License Agreement,
Co-Pack and Warehousing Agreement, Lease Override Agreement, and EBITDA Overview
Committee Agreement (collectively referred to herein as the "Agreements").
B. Each of the parties desire to make certain modifications to the Agreements to
either change the nature of the transactions set forth therein and/or to clarify
uncertainties with respect to the interpretation of existing provisions of the
Agreements.
C. The parties have been in negotiations to resolve all modifications to the
Agreements desired by each of the parties, but have not yet reached a mutually
acceptable resolution.
D. The parties have agreed to make certain modifications to the Agreements that
are set forth herein and desire to continue negotiations to resolve all
remaining matters.
NOW, THEREFORE, in consideration of the mutual agreements set forth herein, the
receipt and sufficiency of which is acknowledged and accepted by each of the
parties, the parties agree as follows:
1. The parties agree that the EBITDA payment that Hoopeston owes to Xxxxxx under
the Lease Override Agreement for Hoopeston's fiscal year ended June 30, 2003,
shall be paid by Hoopeston executing and issuing to Xxxxxx a subordinated
promissory note (the "Note") in the form attached hereto as Exhibit A. The
principal amount of the Note shall be equal to 50% of the EBITDA of Hoopeston
for the fiscal year ended June 30, 2003, as determined by reference to
Hoopeston's audited income or operating statement (which is being finalized and
is expected to be available within approximately 60 days from the date of this
Amendment). The Note shall be dated as of October 15, 2003, and shall have the
other terms and conditions set forth in the form of the Note attached hereto as
Exhibit A. The foregoing shall only apply with respect to the payment due Xxxxxx
for Hoopeston's fiscal year ended June 30, 2003, and shall not apply to payments
for future fiscal years.
2. The definition of "Monthly Rent," as set forth in the Lease Agreement shall
be deleted in its entirety and replaced with the following: "A fixed amount per
month equal to $34,719.00."
3. In connection with a financing being obtained by Xxxxxx, Hoopeston agrees to
execute the estoppel certificates and subordination and attornment agreement in
the forms attached hereto as Exhibit B.
4. The parties desire to continue negotiations in an attempt to reach agreement
on all other modifications to the Agreements desired by each party (referred to
herein as a "Global Resolution"). However, the parties are not obligated to
agree on a Global Resolution and the failure to so agree or the termination of
negotiations by either party shall not (i) affect the validity of this Amendment
or the transactions set forth herein, or (ii) create any liability for, or
impose liability on, either party. Except as specifically amended hereby, the
Agreements remain unchanged and in full force and effect and each party fully
reserves and does not waive any of its rights, claims, defenses, positions and
arguments under the Agreements including, without limitation, with respect to
the other matters that are outstanding between the parties and to be addressed
as part of the intended Global Resolution. Any conflict between the terms of
this Amendment and the provisions of the Agreements shall be resolved in
accordance with the provisions of this Amendment.
The parties have executed this Amendment, effective as of the date first set
forth above, by their duly authorized officers.
Xxxxxx Canning Company
By:
--------------------------
Title:
-----------------------------
Hoopeston Foods Denver Corp.
By:
--------------------------
Title:
-----------------------------
Exhibit A
(Form of Note)
Exhibit B
(Estoppel Certificate and Subornation and Attornment Agreement)
