SMITHFIELD FOODS, INC. AMENDMENT AGREEMENT NO. 1
EXHIBIT 4.4
SMITHFIELD FOODS, INC.
AMENDMENT AGREEMENT NO. 1
As of December 31, 2002
To each of the Current Holders
listed in Annex 1 attached hereto
Ladies and Gentlemen:
Smithfield Foods, Inc., a Virginia corporation (together with its respective successors and assigns, the “Issuer”) agrees with you as follows:
1. PRELIMINARY STATEMENTS.
The Issuer issued and sold:
(a) Twenty-Five Million Dollars ($25,000,000) in aggregate principal amount of Reset Rate Series O 5/10 Year Senior Secured Notes (as they may be amended, restated or otherwise modified from time to time, the “Series O Notes”); and
(b) Thirty Million Dollars ($30,000,000) in aggregate principal amount of its Adjustable Rate Series P 5/10 Year Senior Secured Notes (as they may be amended, restated or otherwise modified from time to time, the “Series P Notes” and, together with the Series O Notes, collectively, the “Notes”),
pursuant to those separate Note Purchase Agreements each dated as of March 1, 2002 between the Issuer and the purchasers named in Annex 1 thereto (the “Existing Purchase Agreements”). The register kept by the Issuer for the registration and transfer of the Notes indicates that each of the Persons named in Annex 1 hereto (collectively, the “Current Holders”) is currently a holder of the original aggregate principal amount of the Notes indicated in such Annex.
2. DEFINED TERMS.
Capitalized terms used herein and not otherwise defined herein have the meanings ascribed to them in the Existing Purchase Agreements.
3. AMENDMENTS TO EXISTING PURCHASE AGREEMENTS.
Subject to Section 5, the Current Holders and the Issuer hereby agree to each of the amendments to the Existing Purchase Agreements as provided for by this Amendment Agreement No. 1 (this “Amendment Agreement”) in the manner specified in Exhibit 3. Such amendments are referred to herein, collectively, as the “Amendments”.
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4. REPRESENTATIONS AND WARRANTIES OF THE ISSUER.
To induce you to enter into this Amendment Agreement and to consent to the Amendments, the Issuer represents and warrants as follows:
4.1. Material Adverse Effect.
Since the date of the last audited consolidated financial statements of the Issuer delivered to each of the Current Holders, no event has occurred or condition exists which has had, or could reasonably be expected to have, a Material Adverse Effect.
4.2. Organization, Power and Authority, etc.
The Issuer is duly organized and validly existing under the laws of its jurisdiction of organization and has all requisite corporate power and authority to enter into and perform its obligations under this Amendment Agreement.
4.3. Legal Validity.
The execution and delivery of this Amendment Agreement by the Issuer and compliance by the Issuer with its obligations hereunder: (a) are within the corporate powers of the Issuer; and (b) are legal and do not conflict with, result in any breach of, constitute a default under, or result in the creation of any Lien upon any Property of the Issuer under the provisions of: (i) any charter instrument or bylaw to which the Issuer is a party or by which the Issuer or any of its Property may be bound; (ii) any order, judgment, decree or ruling of any court, arbitrator or governmental authority applicable to the Issuer or its Property; or (iii) any agreement or instrument to which the Issuer is a party or by which the Issuer or any of its Property may be bound or any statute or other rule or regulation of any governmental authority applicable to the Issuer or its Property, except where such conflict, breach or default could not reasonably be expected to have a Material Adverse Effect.
This Amendment Agreement has been duly authorized by all necessary action on the part of the Issuer, has been executed and delivered by a duly authorized officer of the Issuer, and constitutes a legal, valid and binding obligation of the Issuer, enforceable in accordance with its terms, except that enforceability may be limited by applicable bankruptcy, reorganization, arrangement, insolvency, moratorium, or other similar laws affecting the enforceability of creditors’ rights generally and subject to the availability of equitable remedies.
4.4. No Defaults.
Immediately prior to and after giving effect to the Amendments set forth in this Amendment Agreement, no Default or Event of Default will exist.
5. EFFECTIVENESS OF AMENDMENTS.
The Amendments shall become effective as of the first date written above (the “Effective Date”), if at all, at such time as all of the Current Holders shall have indicated their written consent to such amendments by executing and delivering the applicable counterparts of this
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Amendment Agreement. It is understood that any Current Holder may withhold its consent for any reason, and that, without limitation of the foregoing, each Current Holder hereby makes the granting of its consent contingent upon satisfaction of the following conditions:
5.1. Amendment to Credit Facility.
Each Current Holder shall have received true and correct copies of the fully executed amendment (the “Credit Facility Amendment”) to the Credit Facility substantially in the form of Exhibit 5.1 hereto;
5.2. Amendment of Other Note Agreements.
Each Current Holder shall have received true and correct copies of the fully executed amendments (collectively, the “Other Purchase Agreement Amendments”) to those certain separate Note Purchase Agreements, dated as of June 2, 2000 between the Issuer and each of the purchasers listed on Annex 1 thereto, those certain separate Amended and Restated Note Purchase Agreements, dated as of October 31, 1999, between the Issuer and each of the noteholders listed on Annex 1 thereto and those certain separate Note Purchase Agreements, dated as of October 27, 1999, between the Issuer and each of the purchasers listed on Annex 1 thereto. Each such amendment shall be substantially in the form of this Amendment Agreement;
5.3. Opinion of Counsel.
The Current Holders shall have received from special counsel to the Issuer, a closing opinion, dated as of the Effective Date, and in form and substance satisfactory to the Current Holders. This Section 5.3 shall constitute direction by the Issuer to such counsel to deliver such closing opinion to the Current Holders;
5.4. Amendment Fee.
The fee to be paid to the Current Holders pursuant to Section 7 of this Amendment Agreement shall have been paid in full;
5.5. Expenses.
The payment of the expenses to be paid on behalf of the Current Holders pursuant to Section 8 of this Amendment Agreement (to the extent a statement therefore has been presented to the Issuer on or prior to the Effective Date) shall have been paid in full; and
6. CONSENT.
The Current Holders hereby consent to the execution and delivery of the Credit Facility Amendment and the Other Purchase Agreement Amendments to the extent that such consent is required under the terms of the Financing Documents.
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7. AMENDMENT FEE.
In consideration of the execution and delivery by the Current Holders of this Amendment Agreement and the consent by the Current Holders to the Amendments, on or prior to the Effective Date, the Issuer shall have paid to each of the Current Holders a fee in an amount equal to 0.10% of the aggregate outstanding principal amount of the Notes held by such Current Holder and in the manner and to the accounts specified in the Existing Purchase Agreements.
8. EXPENSES.
Whether or not the Amendments become effective, the Issuer will promptly (and in any event within thirty (30) days of receiving any statement or invoice therefor) pay all fees, expenses and costs relating to this Amendment Agreement, including, but not limited to, the reasonable fees of your special counsel, Xxxxxxx XxXxxxxxx LLP, incurred in connection with the preparation, negotiation and delivery of this Amendment Agreement and any other documents related thereto. Nothing in this Section 8 shall limit the Issuer’s obligations pursuant to Section 1.5 of the Existing Purchase Agreements.
9. MISCELLANEOUS.
9.1. Part of Existing Purchase Agreements; Future References, etc.
This Amendment Agreement shall be construed in connection with and as a part of the Existing Purchase Agreements and, except as expressly amended by this Amendment Agreement, all terms, conditions and covenants contained in the Existing Purchase Agreements are hereby ratified and shall be and remain in full force and effect. Any and all notices, requests, certificates and other instruments executed and delivered after the execution and delivery of this Amendment Agreement may refer to the Existing Purchase Agreements without making specific reference to this Amendment Agreement, but nevertheless all such references shall include this Amendment Agreement unless the context otherwise requires.
9.2. Counterparts.
This Amendment 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. Delivery of a facsimile of an executed signature page hereto shall be effective as delivery of an original.
9.3. Governing Law.
THIS AMENDMENT AGREEMENT SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH, AND THE RIGHTS OF THE PARTIES SHALL BE GOVERNED BY, THE LAW OF THE COMMONWEALTH OF VIRGINIA EXCLUDING CHOICE-OF-LAW PRINCIPLES OF THE LAW OF SUCH COMMONWEALTH THAT WOULD REQUIRE THE APPLICATION OF THE LAWS OF A JURISDICTION OTHER THAN SUCH COMMONWEALTH.
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If you are in agreement with the foregoing, please so indicate by signing the acceptance below on the accompanying counterpart of this agreement and returning it to the Issuer, whereupon it will become a binding agreement among you and the Issuer.
| SMITHFIELD FOODS, INC. | ||
| By: |
/s/ Xxxxxx X. Xxxxxxx | |
| Name: |
Xxxxxx X. Xxxxxxx | |
| Title: |
Vice President and Chief Financial Officer | |
[Signature Page to Amendment Agreement No. 1 (O-P)]
The foregoing Amendment Agreement is hereby accepted as of the date first above written.
XXXX XXXXXXX LIFE INSURANCE COMPANY
| By: |
/s/ Xxxxx X. Xxxxxxx | |
| Name: |
Xxxxx X. Xxxxxxx | |
| Title: |
Managing Director |
XXXX XXXXXXX VARIABLE LIFE INSURANCE COMPANY
| By: |
/s/ Xxxxx X. Xxxxxxx | |
| Name: |
Xxxxx X. Xxxxxxx | |
| Title: |
Authorized Signatory |
INVESTORS PARTNER LIFE INSURANCE COMPANY
| By: |
/s/ Xxxxx X. Xxxxxxx | |
| Name: |
Xxxxx X. Xxxxxxx | |
| Title: |
Authorized Signatory |
SIGNATURE 5 L.P.
By: Xxxx Xxxxxxx Life Insurance Company, as Portfolio Advisor
| By: |
/s/ Xxxxx X. Xxxxxxx | |
| Name: |
Xxxxx X. Xxxxxxx | |
| Title: |
Managing Director |
COBANK, ACB
| By: |
/s/ Xxxxxxx X. Xxxxxxx | |
| Name: |
Xxxxxxx X. Xxxxxxx | |
| Title: |
Vice President |
[Signature Page to Amendment Agreement No. 1 (O-P)]
The undersigned consent to the Amendments effected by the foregoing Amendment Agreement.
CODDLE ROASTED MEATS, INC.
XXXXXXXX OF SMITHFIELD, LTD.
XXXXXXX’X OLD FASHIONED COUNTRY HAM, INC.
IOWA QUALITY MEATS, LTD.
XXXX XXXXXXX & CO.
XXXXX MEAT GROUP, INC.
XXXXX PACKING COMPANY
NORTH SIDE FOODS CORP.
PACKERLAND HOLDINGS, INC.
PACKERLAND PROCESSING COMPANY, INC.
PACKERLAND-PLAINWELL, INC. (f/k/a Murco Foods, Inc.)
XXXXXXX XXXXXX INCORPORATED
PREMIUM PORK, INC.
QUIK-TO-FIX FOODS, INC.
SFFC, INC.
SMITHFIELD PURCHASE CORPORATION (successor by merger to Xxxxxxx’x Realty, Inc.)
XXXXXXX’X COUNTRY HAMS, INC.
SUN LAND BEEF COMPANY
SUNNYLAND, INC.
THE SMITHFIELD COMPANIES, INC.
THE SMITHFIELD PACKING COMPANY INCORPORATED
XXXXXX-XXXXX LLC
By: Xxxx Xxxxxxx & Co., as sole member
XXXXXX FARMS LLC
QUARTER M FARMS LLC
XXXXXXX’X FOODS OF VIRGINIA LLC
XXXXXXX’X FOODS LLC
CIRCLE FOUR LLC
CENTRAL PLAINS FARMS LLC
XXXXX’X OF CAROLINA LLC
By: Xxxxxx-Xxxxx LLC, as sole member
By: Xxxx Xxxxxxx & Co., as sole member
XXXXX’X FARMS, LLC
By: Xxxxx’x of Carolina LLC, as sole member
By: Xxxxxx-Xxxxx LLC, as sole member
By: Xxxx Xxxxxxx & Co., as sole member
XXXXXXX’X REALTY PARTNERSHIP
By: Smithfield Purchase Corporation, as general partner
SMITHFIELD PACKING REAL ESTATE, LLC
By: The Smithfield Packing Company Incorporated, as sole member
GREAT LAKES CATTLE CREDIT COMPANY, LLC
By: Packerland Holdings, Inc., as sole member
[Signature page to Amendment Agreement No. 1 (O-P)]
SMITHFIELD-XXXXXXX’X FARMS
By: Smithfield Purchase Corporation, as general partner
XXXXX’X REALTY PARTNERSHIP
By: Xxxxx’x Farms, LLC, its partner
By: Xxxxx’x of Carolina LLC, its sole member and manager
By: Xxxxxx-Xxxxx LLC, its sole member and manager
By: Xxxx Xxxxxxx & Co., as sole member
and
By: Smithfield Purchase Corporation, its partner
SMITHFIELD PACKING REALTY PARTNERSHIP
By: Smithfield Packing Real Estate, LLC, its partner
By: The Smithfield Packing Company, Incorporated, its sole member and manager
and
By: Smithfield Purchase Corporation, its partner
| By: |
/s/ Xxxxxx X. Xxxxxxx | |
| Name: |
Xxxxxx X. Xxxxxxx | |
| Title |
Vice President and Chief Financial Officer |
[Signature Page to Amendment Agreement No. 1 (O-P)]
ANNEX 1
CURRENT HOLDERS AND PRINCIPAL AMOUNTS
| Name of Current Holder |
Aggregate Principal Amount of Series O Notes Held |
Aggregate Principal Amount of Series P Notes Held | ||||
| Xxxx Xxxxxxx Life Insurance Company |
$ |
19,000,000 |
$ |
-0- | ||
| Xxxx Xxxxxxx Variable Life Insurance Company |
$ |
750,000 |
$ |
-0- | ||
| Investors Partner Life Insurance Company |
$ |
250,000 |
$ |
-0- | ||
| Signature 5 L.P. |
$ |
5,000,000 |
$ |
-0- | ||
| XxXxxx, ACB |
$ |
-0- |
$ |
- 30,000,0000- | ||
Annex 1-1
EXHIBIT 3
AMENDMENTS TO EXISTING PURCHASE AGREEMENTS
1. The Existing Purchase Agreements are hereby amended by adding a new Section 4.9 to read as follows:
4.9. Incremental Margin Period.
Notwithstanding anything to the contrary set forth in this Agreement or in any of the other Financing Documents, at all times during the Incremental Margin Period the interest rate then in effect for the Notes shall be increased by an amount equal to the Incremental Margin then in effect.
2. Section 6.7 of the Existing Purchase Agreements is hereby amended and restated in its entirety to read as follows:
6.7. Maintenance of Funded Debt.
(a) Consolidated Funded Debt. The Company shall not permit Consolidated Funded Debt, determined as of the end of each fiscal quarter of the Company, to exceed the Applicable Funded Debt Percentage of Consolidated EBITDA for the period of four (4) consecutive fiscal quarters of the Company ended at such time.
(b) Consolidated Senior Funded Debt. The Company shall not permit Consolidated Senior Funded Debt, determined as of the end of each fiscal quarter of the Company, to exceed the Applicable Senior Funded Debt Percentage of Consolidated EBITDA for the period of four (4) consecutive fiscal quarters of the Company ended at such time.
3. Section 9.1 of the Existing Purchase Agreements is hereby amended by adding the following new definitions in the appropriate alphabetical order to read as follows:
3FQ03 – means the fiscal quarter of the Company ending on January 26, 2003.
4FQ03 – means the fiscal quarter of the Company ending on April 27, 2003.
1FQ04 – means the fiscal quarter of the Company ending on July 27, 2003.
2FQ04 – means the fiscal quarter of the Company ending on October 26, 2003.
3FQ04 – means the fiscal quarter of the Company ending on January 25, 2004.
Applicable Funded Debt Percentage – means, at any fiscal quarter end, the percentage applicable to such fiscal quarter end in the table set forth below:
Exhibit 3-1
| Fiscal Quarter End |
Percentage | |
| All fiscal quarter ends prior to the end of 3FQ03 |
400% | |
| 3FQ03 |
450% plus New Debt Step Up | |
| 4FQ03 |
450% plus New Debt Step Up | |
| 1FQ04 |
450% plus New Debt Step Up | |
| 2FQ04 |
400% plus New Debt Step Up | |
| All fiscal quarter ends after the end of 2FQ04 |
400% |
Applicable Senior Funded Debt Percentage – means, at any fiscal quarter end, the percentage applicable to such fiscal quarter end in the table set forth below:
| Fiscal Quarter End |
Percentage | |
| All fiscal quarter ends prior to the end of 3FQ03 |
320% | |
| 3FQ03 |
400% plus New Debt Step Up | |
| 4FQ03 |
400% plus New Debt Step Up | |
| 1FQ04 |
400% plus New Debt Step Up | |
| 2FQ04 |
375% plus New Debt Step Up | |
| All fiscal quarter ends after the end of 2FQ04 |
320% |
Incremental Margin – means, at all times during each fiscal quarter during the Incremental Margin Period, (a) zero (0) if Consolidated Funded Debt at the end of the immediately preceding fiscal quarter is not more than 400% of Consolidated EBITDA for the period of four (4) consecutive fiscal quarters of the Company then most recently ended, (b) one half of one percent (0.50%) if Consolidated Funded Debt at the end of the immediately preceding fiscal quarter is more than 400% but less than 450% of Consolidated EBITDA for the period of four (4) consecutive fiscal quarters of the Company then most recently ended and (c) three quarters of one percent (0.75%) if Consolidated Funded Debt at the end of the immediately preceding fiscal quarter is not less than 450% of Consolidated EBITDA for the period of four (4) consecutive fiscal quarters of the Company then most recently ended.
Incremental Margin Period – means the period from the start of 4FQ03 to and including the end of 3FQ04.
New Debt Step Up – means (a) zero percent (0%) if the Company shall have incurred, in aggregate, less than $200,000,000 of Unsecured Debt after December 31, 2002, (b) twenty-five percent (25%) if the Company shall have incurred, in aggregate, not less than $200,000,000 nor more than $300,000,000 of Unsecured Debt after December 31, 2002 and (c) fifty percent (50%) if the Company shall have incurred, in aggregate, more than $300,000,000 of Unsecured Debt after December 31, 2002.
Exhibit 3-2
Unsecured Debt – means any Debt of the Company or any of its Subsidiaries of the type described in paragraph (a) of the definition of Debt which (a) shall have been issued in a private placement or public offering, (b) has an initial term of more than one (1) year and (c) is not secured by any Lien on any Property of the Company or its Subsidiaries.
Exhibit 3-3
