EXHIBIT 10.1
August 4, 2003
C&S Acquisition LLC
C&S Wholesale Grocers, Inc.
00 Xxx Xxxxx Xxxx
Xxxxxxxxxxx, Xxxxxxx 00000
Attn: General Counsel
Re: Asset Purchase Agreement and Ancillary Documents
Ladies and Gentlemen:
Reference is made to the Asset Purchase Agreement dated as of July 7,
2003, among C&S Acquisition LLC, a Delaware limited liability company
("Purchaser"), Xxxxxxx Companies, Inc., an Oklahoma corporation ("Xxxxxxx"),
certain other affiliates of Xxxxxxx (each, a "Seller" and collectively,
"Sellers"), each a debtor and debtor in possession under Chapter 11 Case No.
03-10945 (MFW) (jointly administered) pending in the United States Bankruptcy
Court for the District of Delaware and, with respect to Article V and Sections
14.8 and 14.11 thereof only, C&S Wholesale Grocers, Inc., a Vermont corporation
("Parent") (the "Agreement"). Capitalized terms used herein and not otherwise
defined shall have the meanings set forth in the Agreement.
Pursuant to Section 14.3 of the Agreement, effective as of the date
hereof, this letter shall amend the Agreement as follows:
1. The parties hereto acknowledge and agree that, notwithstanding
anything in the Agreement to the contrary, including clause (iii) within the
definition of "Acquired Contracts" and Section 2.2(q) of the Agreement, all
vendor supply agreements for the supply of products to the U.S. military
("Military Supply Agreements") shall be deemed part of Acquired Assets;
provided, however, notwithstanding anything in the Agreement to the contrary,
including Sections 2.8 and 2.9 of the Agreement, Sellers shall have no
obligation or liability to pay any Cure Costs associated with such Military
Supply Agreements; provided, further, that such Military Supply Agreements shall
not be assumed and assigned as of the Initial Closing, but rather may be assumed
and assigned in accordance with Section 2.5 of the Agreement subsequent to the
Initial Closing following the entry of one or more applicable Supplemental Sales
Orders. Notwithstanding anything in this letter or the Agreement to the
contrary, including Section 6.2 of the Agreement, Sellers may in their sole
discretion settle any Military Supply Agreement, including, without limitation,
by way of termination of such Military Supply Agreement and sale of related
inventory, and retain the proceeds of such settlement; provided, however, upon
receipt by Sellers of Purchaser's Option Notice(s) to expressly assume any
Military Supply Agreement, Sellers shall not settle such Military Supply
Agreement without the prior consent of Purchaser (provided, however, no such
consent shall be required to the extent that Sellers have been in settlement
discussions relating to such Military Supply Agreement and Sellers may continue
such settlement discussions and may settle such Military Supply Agreement and
retain the proceeds therefrom); provided, further, to the extent such consent of
Purchaser is required, Purchaser shall not unreasonably withhold such consent
and shall reasonably assist Sellers in the collection of accounts and trade
receivables due under such Military Supply Agreement.
2. The parties hereto acknowledge and agree that, notwithstanding
anything in the Agreement to the contrary, including clause (iii) within the
definition of "Acquired Contracts"
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August 4, 2003
Page 2
and Section 2.2(q) of the Agreement, all vendor supply agreements for the supply
of private label products ("Private Label Supply Agreements") shall be deemed
part of Acquired Assets; provided, however, notwithstanding anything in the
Agreement to the contrary, including Sections 2.8 and 2.9 of the Agreement,
Sellers shall have no obligation or liability to pay any Cure Costs associated
with such Private Label Supply Agreements; provided, further, that such Private
Label Supply Agreements shall not be assumed and assigned as of the Initial
Closing, but rather may be assumed and assigned in accordance with Section 2.5
of the Agreement subsequent to the Initial Closing following the entry of one or
more applicable Supplemental Sales Orders.
3. The parties hereto acknowledge and agree that, notwithstanding
anything in the Agreement to the contrary, no Acquired Contract to which any
ABCO Seller is a party shall be assumed or assigned as of the Initial Closing,
but rather may be assumed and assigned in accordance with Section 2.5 of the
Agreement subsequent to the Initial Closing following the entry of one or more
applicable Supplemental Sales Orders.
4. Section 1.1 of the Agreement is hereby amended by adding the
following definition in such section in its alphabetical order:
""ABCO Seller" means each of ABCO Food Group, Inc., a Nevada
corporation, ABCO Markets, Inc., an Arizona corporation, and ABCO
Realty Corp, an Arizona corporation."
5. The definition of "Affiliate" set forth in Section 1.l of the
Agreement is hereby amended by deleting it in its entirety and replacing it with
the following text:
""Affiliate" shall (i) as such term may relate to any of the
Sellers, have the meaning set forth in Bankruptcy Code section 101(2),
and (ii) as such term may relate to Purchaser or Parent, have the
meaning set forth in Rule 12b-2 of the regulations promulgated under
the Securities Exchange Act of 1934, as amended."
6. The definition of "Break-Up Fee" set forth in Section 1.1 of the
Agreement is hereby amended by deleting it in its entirety and replacing it with
the following text:
""Break-Up Fee" shall mean an amount equal to $11,000,000
(i.e., two and three-quarters percent (2.75%) of the Estimated Purchase
Price)."
7. The definition of "Encumbrance" set forth in Section 1.1 of the
Agreement is hereby amended by deleting it in its entirety and replacing it with
the following text:
""Encumbrance" shall mean any mortgage, pledge, lien
(statutory or otherwise), security interest, easement, right of way,
covenant, claim, restriction, right, option, conditional sale or other
title retention agreement, charge or encumbrance of any kind or nature,
including actions in rem and lis pendens, but not any Offset Right, in
respect of any Acquired Assets."
8. Section 1.1 of the Agreement is hereby amended by adding the
following definition in such section in its alphabetical order:
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August 4, 2003
Page 3
""FSA" means a facility standby agreement to which a customer
of Seller is a party.
""FSA Accounts Receivable" means the trade accounts receivable
of Sellers arising from customers' purchases of products from Sellers
pursuant to FSAs.
""FSA Accounts Receivable Compromised Amount" means, with
respect to any FSA of any FSA Customer, the amount of any FSA Accounts
Receivable that is not an FSA Accounts Receivable Uncompromised Amount.
""FSA Accounts Receivable Compromised Limit" shall have the
meaning set forth in Section 2.9(e).
""FSA Accounts Receivable Uncompromised Amount" means, with
respect to any FSA of any FSA Customer, the amount of any FSA Accounts
Receivable that is paid in full in cash to Sellers on or prior to the
FSA Settlement Date pursuant to Section 2.9.
""FSA Customer"" means a customer of Seller that is party to
an FSA that is an Acquired Contract as of the Initial Closing Date.
""FSA Settlement Date" shall have the meaning set forth in
Section 2.9(d).
""FSA Settlement Notice" shall have the meaning set forth in
Section 2.9(d).
""Offset Right" means any right of a creditor (other than
those rights that were actually exercised prior to the Petition Date)
to offset a mutual debt owing by such creditor to a Seller that arose
before the Petition Date against a claim of such creditor against a
Seller that arose before the Petition Date as provided in section 553
of the Bankruptcy Code."
9. The definition of "Permitted Encumbrances" set forth in Section 1.1
of the Agreement is hereby amended by deleting it in its entirety and replacing
it with the following text:
""Permitted Encumbrances" means (a) any Lien for Taxes not yet
due or payable, (b) statutory or mechanics', landlords',
warehousemen's, suppliers', materialmen's, carriers', workmen's,
repairmen's liens and other like Liens imposed by law arising or
incurred in the ordinary course of business consistent with past
practice with respect to amounts not yet due (provided that such
amounts arising or accruing prior to the Initial Closing remain
Excluded Liabilities) and which do not and would not, individually or
in the aggregate, have a Material Adverse Effect, (c) with respect to
the Owned Real Property, encumbrances consisting of zoning
restrictions, easements and other restrictions on the use of such Owned
Real Property, provided that such items do not and would not reasonably
be expected to have, individually or in the aggregate, have a Material
Adverse Effect, (d) any laws, rules, regulations, statutes or
ordinances affecting the PSCs and which do not, individually or in the
aggregate, have a
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August 4, 2003
Page 4
Material Adverse Effect, (e) with respect to the Owned Real Property,
any utility company rights, easements and franchises and similar rights
or easements granted to third parties for electricity, water, steam,
gas, telephone or other service or the right to use and maintain poles,
lines, wires, cables, pipes, boxes and other fixtures and facilities
in, over, under and upon such Owned Real Property, provided that the
same do not and would not reasonably be expected to have, individually
or in the aggregate, have a Material Adverse Effect, (f) with respect
to the Owned Real Property, title defects or matters that would be
customarily disclosed by an accurate survey or inspection of the Owned
Real Party Leases that do not, individually or in the aggregate,
materially impair the value or use of the Owned Real Property, (g) as
to any Lease, the Subleases and (h) as to the Owned Real Property, the
Owned Real Property Leases."
10. Clause (ii) in the definition of "Sale Order" set forth in Section
1.1 of the Agreement is hereby amended by deleting it in its entirety and
replacing it with the following text:
"(ii) the approval of the sale of the Acquired Assets to
Purchaser free and clear, pursuant to section 363(f) of the Bankruptcy
Code, of all claims, Offset Rights, Liens, and Encumbrances (other than
Permitted Encumbrances) or other interests (collectively,
"Interests"),"
11. The definition of "Sales Material Adverse Effect" set forth in
Section 1.1 of the Agreement is hereby amended by deleting it in its entirety
and replacing it with the following text:
""Sales Material Adverse Effect" means a decline in Sales, if
any, associated with the Operating PSCs which exceed 32 1/2% for the
four (4) week period ended the Saturday immediately preceding the
Initial Closing Date, as compared to the four (4) week period ended
June 14, 2003."
12. The parenthetical clause at the end of the first sentence of
Section 2.5(c) of the Agreement is hereby amended by deleting it in its entirety
and replacing it with the following text:
"(which in no event shall be earlier than thirty (30) days
following the delivery of such Option Notice, or, if given on or prior
to August 2, 2003, no earlier than the Initial Closing); provided,
however, notwithstanding the foregoing, Purchaser shall only be
required to deliver an Option Notice in respect of any owned Acquired
Assets, including, without limitation, any Owned Real Property, three
(3) Business Days prior to the expected date of the consummation of
such purchase or exclusion; provided, further, notwithstanding the
foregoing, Sellers shall use their commercially reasonable efforts to
deliver all documents and instruments required under this Agreement to
be delivered to Purchaser in connection with the consummation of the
sale of any Owned Real Property (including, without limitation, deeds,
surveys and title commitments) but, if the Option Notice with respect
to such Owned Real Property was delivered after
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August 4, 2003
Page 5
August 2, 2003 with respect to the Initial Closing or with less than
thirty (30) days notice with respect to any Subsequent Closing, then
Sellers shall not be obligated to deliver any such documents and
instruments on such date of consummation if any such documents cannot
be obtained on or prior to the date of such consummation despite
Sellers commercially reasonable efforts but Sellers shall be obligated
to deliver any such documents and instruments on or prior to later of
the thirtieth (30th) day following delivery of such Option Notice or
the consummation of the sale of such Owned Real Property"
13. The second sentence of Section 2.5(c) of the Agreement is hereby
amended by deleting it in its entirety and replacing it with the following
sentence:
"Notwithstanding anything to the contrary in this Section
2.5, at one or more times during the Option Period, Purchaser may, by
delivering a written notice to Sellers, (i) revoke its request in a
Option Notice previously delivered hereunder to have an Acquired Asset
transferred to Purchaser, a Purchaser Assignee or a Third Party
Purchaser, (ii) change the identity of the Person who shall be the
transferee of an Acquired Asset which is identified in an Option Notice
previously delivered hereunder as an asset to be transferred pursuant
to this Agreement, or (iii) extend the expected timing of the
consummation of the purchase of an Acquired Asset (as such expected
timing is set forth in an Option Notice or written notice previously
delivered hereunder) to any date during the Option Period; provided,
however, that with respect to any specific Acquired Asset, Purchaser
may exercise its rights in clause (i) of this sentence one time only."
14. The first sentence of Section 2.5(e) of the Agreement is hereby
amended by adding the following provision at the end of such sentence:
"; provided, however, that if Purchaser, Purchaser's Assignee
or a Third Party Purchaser, at such party's sole and absolute
discretion, elects to and does so specify in an Option Notice to reject
an Acquired Contract, Sellers shall be required to reject, and shall
not have any option to retain, such Acquired Contract"
15. The second sentence of Section 2.5(e) of the Agreement is hereby
amended by deleting it in its entirety and replacing it with the following text:
"In respect of any Acquired Contract Purchaser, Purchaser's
Assignee or Third Party Purchaser requires in an Option Notice that
Sellers reject, and in respect of any Acquired Contract for which such
specification has not been made but Sellers elect to reject, promptly
following the expiration of such three (3) Business Day period, Sellers
shall file, duly serve and diligently prosecute a motion in the
Bankruptcy Court seeking authorization, as necessary, to reject such
specified Acquired Contracts."
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August 4, 2003
Page 6
16. Section 2.9 of the Agreement is hereby amended by adding the
following provisions at the end of such section:
"(c) Subject to the limitations of Section 2.9 (d) and (e) and
notwithstanding anything herein to the contrary: (i) Purchaser shall be
permitted to negotiate with any FSA Customer for the payment of or
settlement of the payment of any Cure Cost associated with any Acquired
Contract to which such FSA Customer is a party; (ii) within five (5)
Business Days of the delivery to Sellers of an FSA Settlement Notice in
accordance with Section 2.9(d), Sellers shall notify the Cure Escrow
Agent to release from the Cure Escrow any cash amounts to be paid
pursuant to such FSA Settlement Notice; and (iii) Sellers shall execute
such documents as reasonably requested by Purchaser to provide for the
settlement or compromise of any FSA Accounts Receivable associated with
such FSA Customer set forth in such FSA Settlement Notice and which
complies with this Section 2.9.
"(d) A notice (each, an "FSA Settlement Notice") that
Purchaser has agreed to make payments to, or cause payments to be made
to, an FSA Customer relating to any Cure Costs associated with any
Acquired Contract to which such FSA Customer is a party (each, an "FSA
Settlement") shall state: (i) the identity of the FSA Customer; (ii)
the identity of all Acquired Contracts to which such FSA Customer is a
party; (iii) the identity of the Acquired Contracts that are the
subject of the FSA Settlement; (iv) the amount, if any, of any FSA
Accounts Receivable involved in such FSA Settlement, including, without
limitation the FSA Accounts Receivable Compromised Amount and the FSA
Accounts Receivable Uncompromised Amount; (v) the Cure Amount to be
released from the Cure Escrow; and (vi) the effective date of the
settlement of the Cure Amounts and FSA Accounts Receivable, if any,
associated with such Acquired Contract (which date shall be no earlier
than the fifth Business Day following delivery of such FSA Settlement
Notice) (the "FSA Settlement Date").
"(e) Notwithstanding anything herein to the contrary: (i) the
aggregate of all FSA Accounts Receivable Compromised Amounts shall not
exceed $8.0 million (the "FSA Accounts Receivable Compromised Limit");
(ii) if Purchaser does not utilize the full amount of such $8.0 million
to settle FSA Accounts Receivable, in no event shall the unutilized
portion of such FSA Accounts Receivable be transferred to, utilized by
or otherwise shared with Purchaser, (iii ) to the extent any portion of
the Cure Escrow is utilized to pay or settle any Cure Cost of any FSA
Customer pursuant to an FSA Settlement, then all Cure Costs (including
without limitation all Offset Rights, if any) of such FSA Customer
under all Acquired Contracts to which such FSA Customer is a party
arising out of or related to the PSC pursuant to which such FSA
Customer is serviced under such Acquired Contract (other than Acquired
Contracts that have been rejected pursuant to the Agreement and become
Excluded Contracts) must be extinguished, cancelled and of no force and
effect on or prior to the FSA Settlement Date with respect to such FSA
Settlement; ( iv) to the extent any FSA Accounts Receivable is utilized
to settle any Cure Cost of any FSA Customer pursuant to an FSA
Settlement, then the outstanding amounts of all FSA Accounts Receivable
owing by such FSA Customer shall be considered an FSA Accounts
Receivable Compromised Amount upon the payment of all the amounts
subject to such settlement; (v) if Purchaser enters into a new
agreement
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August 4, 2003
Page 7
with an FSA Customer and has paid or pays such FSA Customer amounts
from the Cure Escrow, then, as part of such new agreement, such FSA
Customer shall agree that no FSA Accounts Receivable shall be subject
to any claim for Cure Costs (including without limitation all Offset
Rights, if any); and (vi) Sellers shall maintain an accounting of all
FSA Settlements, including without limitation, the portions of any Cure
Escrow, any FSA Accounts Receivable Compromised Amount and any FSA
Accounts Receivable Uncompromised Amount utilized in connection
therewith.
"(f) Notwithstanding anything to the contrary, Sellers shall
be permitted to compromise or settle any and all FSA Accounts
Receivable, subject to the following limitations: (i) Sellers shall
provide Purchaser with at least two (2) Business Days written notice of
the intent to consummate a settlement involving a compromise of an FSA
Accounts Receivable which notice shall provide Purchaser with the
specific terms of such settlement; (ii) Seller shall not, as part of
such settlement, accept as payment in full of the outstanding amount of
any FSA Accounts Receivable an amount that is less than 90% of such
outstanding amount (if the proposed date of consummation of the
settlement of such amount is within 30 days following the Initial
Closing Date), 80% of such amount (if the proposed date of consummation
of the settlement of such amount is from and including the 31st day to
the 60th day following the Initial Closing Date), or 70% of such
outstanding amount (if the proposed date of consummation of the
settlement of such amount is from and including the 61st day to the
90th day following the Initial Closing Date); and (iii) on a weekly
basis, Sellers shall provide Purchaser with a status summary of its
collection efforts with regard to FSA Accounts Receivable, including
without limitation, the identity of each FSA Customer, the outstanding
amount of its FSA Accounts Receivable, and a brief description of the
efforts made, if any, to collect such FSA Accounts Receivable.
"(g) Within two (2) Business Days of delivery of such notice,
Purchaser shall notify Sellers that (x) Seller shall be permitted to
consummate such settlement or (y) Seller shall not be permitted to
consummate such settlement and, instead, Purchaser shall have the right
to settle such FSA Accounts Receivable with such FSA Customer and
Sellers shall no longer have the right to settle such FSA Accounts
Receivable with such FSA Customer. If Purchaser elects to have the
right to consummate a settlement, then the full outstanding amount of
such FSA Accounts Receivable shall be considered an FSA Accounts
Receivable Compromised Amount (whether or not such FSA Accounts
Receivable is settled) which shall be applied to the FSA Accounts
Receivable Compromised Limit. If Purchaser does not notify Seller
within such two (2) Business Day period, then Seller shall have the
right to settle such FSA Accounts Receivable with such FSA Customer. If
proceeds from any FSA Accounts Receivable Compromised Amount are
received by Sellers, Sellers shall promptly remit such proceeds to
Purchaser."
17. Section 3.3(a) of the Agreement is hereby amended by deleting it in
its entirety and replacing it with the following text:
"(a) Royalty Amount. Sellers shall be entitled to a
"Royalty Amount" for the customers and customer agreements transferred
to Purchaser
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August 4, 2003
Page 8
that are Purchaser Active Customers pursuant to this Agreement in an
amount equal to one percent (1%) of the Sales to such customers for the
Royalty Period; provided, that "Purchaser Active Customers" shall mean
those customers that continue to order products on a regular basis
(other than Sales during a wind-down period for such customer) during
the two weeks preceding the thirtieth (30th) day after the Initial
Closing."
18. The second sentence of Section 3.3(b)(ii) of the Agreement is
hereby amended by deleting it in its entirety and replacing it with the
following text:
"For purposes of the Second Estimate Payment, Purchaser and
Sellers shall make a good-faith estimate of the Second Estimate Payment
based upon the annualized run rate of Sales to Purchaser Active
Customers over the 60-day period immediately following the Initial
Closing Date)."
19. Section 3.3(b)(iii) of the Agreement is hereby amended by deleting
it in its entirety and replacing it with the following text:
"The remainder of the Royalty Amount due for the first year of
the Royalty Period shall be paid promptly following final determination
of the actual Sales to Purchaser Active Customers for the first year of
the Royalty Period pursuant to Section 3.3(d) and in no event later
than three (3) Business Days following such determination."
20. Section 3.3(c) of the Agreement is hereby amended by deleting it in
its entirety and replacing it with the following text:
"(c) Remainder of the Royalty Amount. In each of the four (4)
subsequent years of the Royalty Period, the Royalty Amount shall be
paid promptly following final determination of the actual Sales to
Purchaser Active Customers for each quarter in such year and in no
event later than three (3) Business Days following such determination.
For purposes of this Section 3.3, "year" shall mean each of the
subsequent 12-month periods following the Initial Closing and shall not
refer to calendar or fiscal years."
21. The first sentence of Section 3.3(d) of the Agreement is hereby
amended by deleting it in its entirety and replacing it with the following text:
"Within thirty (30) days after the end of the first year of
the Royalty Period or each quarter following the end of the first year
of the Royalty Period, as the case may be, Purchaser shall calculate
actual Sales for the customer relationships and customer agreements
transferred to Purchaser that are Purchaser Active Customers pursuant
to this Agreement and deliver a statement of such Sales to Sellers
along with related work papers (the "Sales Statement")."
General Counsel
August 4, 2003
Page 9
22. The provided further clause in the second sentence of Section
3.3(e)(i)(x) of the Agreement is hereby amended by deleting the phrase "of
products carried by Sellers with respect to the Business" from such clause.
23. The second sentence of Section 3.3(e)(i)(x) of the Agreement is
hereby amended by adding the following text at the end of such sentence:
"; provided, further, to the extent that the consummation of
the applicable sale or transfer occurs on a Saturday, the references to
the "sixty (60) day(s)", "thirty (30) day(s)" and "thirtieth (30th)
day" in this sentence shall be deemed references to "fifty-six (56)
day(s)", "twenty-eight (28) days(s)" and "twenty-eighth (28th) day",
respectively"
24. Section 3.3(e)(i)(y) of the Agreement is hereby amended by adding
the following text at the end of such section:
"; provided, further, to the extent that the consummation of
the applicable sale or transfer occurs on a Saturday, the references to
the "sixty (60) day" in this section shall be deemed references to
"fifty-six (56) day"
25. The clause ", free and clear of all Liens, other than Permitted
Encumbrances," in Section 4.5(a) of the Agreement is hereby amended by deleting
it in its entirety and replacing it with the following text:
", free and clear of all Offset Rights, Liens and
Encumbrances, other than Permitted Encumbrances,"
26. The clause "free of subtenancies and other occupancy rights and
Liens" in the second and third sentences of Section 4.5(b) of the Agreement is
hereby amended by deleting it in its entirety and replacing it with the
following text:
"free of subtenancies and other occupancy rights and Offset
Rights, Liens and Encumbrances"
27. Clause (iii) of Section 4.14(b) of the Agreement is hereby amended
by deleting it in its entirety and replacing it with the following text:
"(iii) there are no Liens for Taxes which shall attach to any
Acquired Asset once such Acquired Asset is assigned, transferred and
delivered to Purchaser hereunder pursuant to the Sale Order or
applicable Supplemental Sale Order, as the case may be; and"
28. Article IV of the Agreement is hereby amended by adding the
following provision immediately after Section 4.22:
"4.23 Xxxxxxx Foreign Sales Corporation. Xxxxxxx Foreign Sales
Corporation, a Barbados corporation, does not own, lease or otherwise
hold any assets."
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August 4, 2003
Page 10
29. Clause (B) of Section 6.4(a)(iv) of the Agreement is hereby amended
by deleting it in its entirety and replacing it with the following text:
"(B) is accompanied (A) by a cash deposit at least equal to
the Deposit (or if such bid is for less than all of the Acquired
Assets, four and three-quarters percent (4.75%) of the cash purchase
price payable at Closing), which deposit shall not be subject to any
Liens created in favor of any person, and (B) by a duly executed
acquisition agreement that is marked to reflect variations from this
Agreement,"
30. Clause (H) of Section 6.4(a)(iv) of the Agreement is hereby amended
by deleting it in its entirety and replacing it with the following text:
"(H) is for an aggregate purchase price at least equal to the
Estimated Purchase Price plus $19,000,000, provided that for purposes
of this requirement Sellers shall be permitted to aggregate any number
of bids (provided that each individual bid is equal to or greater than
$40,000,000 in cash) (a bid which meets the foregoing requirements
(A)-(H) is hereinafter referred to as a "Qualified Bid");"
31. Section 6.4(a)(viii) of the Agreement is hereby amended by adding
the following sentence at the end of such section:
"Notwithstanding the foregoing and anything in this Agreement
to the contrary, Sellers' Debt Liens shall be permitted to attach to
Sellers' rights under the Deposit Escrow Agreement relating to the
Deposit or under any escrow agreement or arrangement relating to the
deposit of any Potential Bidder (as defined in the Bidding Procedures)
and the proceeds thereof."
32. The second sentence of Section 6.8(b) of the Agreement is hereby
amended by deleting it in its entirety and replacing it with the following text:
"The parties shall together make a physical accounting of the
Material Equipment (the "Initial Equipment Count", together with the
Final Equipment Count (as defined below), the "Equipment Count") by
August 5, 2003 or such other time period mutually agreeable to
Purchaser and Sellers, such Equipment Count may include the making of a
videotape or other similar medium to confirm the existence of Material
Equipment."
33. Article VI of the Agreement is hereby amended by adding the
following provision at the end of such Article:
"Section 6.16 Certain Books and Records.
(a) From the Initial Closing through the expiration of the
Option Period, upon reasonable notice, and subject to Section 6.10,
Sellers will give to the representatives, employees, counsel and
accountants of Purchaser and its lenders, access, during normal
business hours, to the records relating to the items
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August 4, 2003
Page 11
set forth in paragraph numbers 2, 8, 11, 16, 18, 21 and 24 set forth on
Schedule 2.2(m), as such records pertain to the Business, the PSCs, the
Employees or the Acquired Assets and relating to periods prior to,
including and after the Initial Closing Date, and will permit such
persons to examine such records and, subject to the provisions of
Section 6.16(b), shall either (i) provide Purchaser copies of such
records at Purchaser's expense, or (ii) permit Purchaser to copy such
records at Purchaser's expense.
(b) Sellers will provide Purchaser with copies of all employee
records, personnel files and other human resource records relating to
any Employee who becomes a New Employee promptly upon receiving written
notice from Purchaser, as well as copies of all Sellers' records of
legal proceedings and other grievances or disputes relating to
Employees who become New Employees, in each case, at Purchaser's
expense; provided, however, that nothing in this Agreement shall
require Sellers to provide or otherwise give access to performance
reviews or information contained in any performance reviews with
respect to such Employees.
(c) During the period from the Option Notice to the New Hire
Date in respect of any New Employees, to facilitate the hiring by
Purchaser of such New Employees, at Purchaser's request and expense,
Sellers shall provide to the representatives, employees, counsel and
accountants of Purchaser, during normal business hours, access to and
file transfers of all employment systems for payroll and benefits
administration for such New Employees.
(d) Notwithstanding anything in this Agreement to the
contrary, Sellers shall not be required to provide or otherwise give
access to the books, records, work papers and other files and documents
subject to attorney-client privilege, including, without limitation,
any such documents of the audit committee(s) of the Boards of Directors
of the Sellers and PricewaterhouseCoopers LLP and its representatives.
(e) To the extent any provision of this Section 6.16 conflicts
with Schedule 2.2(m), the provisions of this Section shall control."
34. Section 8.11 of the Agreement is hereby amended by adding the
following clause at the end of such section:
"; provided, further, the failure of Purchaser to designate an
Acquired Contract pursuant to Section 2.5(c) on or prior to August 2,
2003 such that Sellers have been unable to file, duly serve and
diligently prosecute a motion in the Bankruptcy Court seeking
authorization, as necessary, for Sellers to assign and Purchaser to
assume such Acquired Contract shall not be a failure to satisfy the
condition set forth in this Section 8.11"
35. Section 10.1 of the Agreement is hereby amended by adding the
following clause at the end of such sentence:
General Counsel
August 4, 2003
Page 12
"; provided, however, that the parties acknowledge and agree
that they will take such actions necessary to ensure that the Initial
Closing shall, subject to Purchaser's satisfaction of its obligations
under Sections 3.1(c)(ii), 3.1(c)(iii) and 3.1(c)(iv), be deemed to
occur on and be effective as of 11:59 p.m. on a Saturday; provided,
further, that all closing documents delivered by the parties pursuant
to this Agreement at the Initial Closing as of such Saturday shall be
held in escrow and not released until such time on the Monday
immediately following such Saturday, or such later day, that Purchaser
satisfies its obligations under Sections 3.1(c)(ii), 3.1(c)(iii) and
3.1(c)(iv)"
36. Section 11.2(c) of the Agreement is hereby amended by adding the
following sentence at the end of such section:
"Notwithstanding the foregoing and anything in this Agreement
to the contrary, Sellers' Debt Liens shall be permitted to attach to
Sellers' rights under the Deposit Escrow Agreement relating to the
Deposit or under any escrow agreement or arrangement relating to the
deposit of any Potential Bidder (as defined in the Bidding Procedures)
and the proceeds thereof."
37. Article XII is hereby amended by adding the following provisions at
the end of such Article:
"12.15 Consequential Damages Order. At the hearing of the
Bankruptcy Court on August 4, 2003 (or such later date to which such
hearing may be continued, so long as such later date occurs on or prior
to August 8, 2003), Sellers and Purchaser shall seek an Order from the
Bankruptcy Court ruling that the waiver by any FSA Customer of any and
all consequential damages under such FSA Customer's FSA is valid and
enforceable, unless such waiver would be unconscionable. If Sellers and
Purchaser mutually agree (in writing by notice to the other parties
pursuant to Section 14.4 within 48 hours of the conclusion of such
hearing) that the terms of such Order provide adequate limitations on
the Cure Costs arising from consequential damages under FSAs, then the
provisions set forth in Exhibit F attached hereto shall be added to (or
deleted, as the case may be, from) the Agreement, and to the extent the
parties do not so mutually agree, Sellers may terminate the Agreement
pursuant to Section 11.1(o).
"12.16 August 14, 2003 Hearing. Notwithstanding the provisions
of Section 2.5 of the Agreement, Sellers represent that they have used
and shall continue to use commercially reasonable efforts to provide
notice on or prior to August 4, 2003 to the non-Seller parties to the
Acquired Contracts (specified in the Option Notice delivered by a Third
Party Purchaser on August 1, 2003 and in the Option Notice delivered by
Purchaser on August 2, 2003) which notice indicated or shall indicate
that such Acquired Contracts are the subject of a hearing on August 14,
2003 involving the assignment and assumption of such Acquired
Contracts. To the extent such non-Seller parties and/or such Acquired
Contracts are not specified in any such Option Notice with sufficient
detail to provide proper notice, each of Sellers and Purchaser shall
use its commercially
General Counsel
August 4, 2003
Page 13
reasonable efforts to obtain the information necessary to provide
proper notice and, upon receipt of such information by Sellers, Sellers
shall promptly provide proper notice to such non-Seller parties.
38. The parties hereto acknowledge and agree that (i) Xxxxxxx Foreign
Sales Corporation, a Barbados corporation ("Xxxxxxx Foreign Sales"), shall be
removed as a signatory and party to the Agreement, and accordingly, that Xxxxxxx
Foreign Sales shall have no rights or obligations under the Agreement or any
Ancillary Document and (ii) each of ABCO Food Group, Inc., a Nevada corporation,
ABCO Markets, Inc., an Arizona corporation, and ABCO Realty Corp, an Arizona
corporation (together with ABCO Food Group, Inc. and ABCO Markets, Inc., the
"ABCO Sellers"), shall be added as a signatory and party to the Agreement as a
"Seller", and accordingly that each of such Persons shall have all rights and
obligations under the Agreement and any Ancillary Documents as a "Seller". By
execution of this letter, each of the ABCO Sellers acknowledges and agrees to be
bound by the Agreement and all Ancillary Documents as a "Seller". The preamble
of the Agreement is hereby amended by deleting it in its entirety and replacing
it with the following text:
""THIS ASSET PURCHASE AGREEMENT is dated July 7, 2003, among
C&S Acquisition LLC, a Delaware limited liability company
("Purchaser"), Xxxxxxx Companies, Inc., an Oklahoma corporation
("Xxxxxxx"), Xxxxxxx Transportation Service, Inc., an Oklahoma
corporation, Piggly Wiggly Company, an Oklahoma corporation, RFS
Marketing Services, Inc., an Oklahoma corporation, Xxxxxxx
International Ltd., an Oklahoma corporation, Xxxxxxx Foods of Texas
L.P., an Oklahoma limited partnership, Xxxxxxx Foods Management Co.,
L.L.C., an Oklahoma limited liability company, ABCO Food Group, Inc., a
Nevada corporation, ABCO Markets, Inc., an Arizona corporation, and
ABCO Realty Corp., an Arizona corporation (together with Xxxxxxx, each,
a "Seller", and collectively, "Sellers"), each a debtor and debtor in
possession under Chapter 11 Case No. 03-10945 (MFW) (jointly
administered) pending in the United States Bankruptcy Court for the
District of Delaware and, with respect to Article V and Sections 14.8
and 14.11 only, C&S Wholesale Grocers, Inc., a Vermont corporation
("Parent")."
39. The second item below numbered row 2 on Schedule 1.1(b)
(Non-Operating PSCs) referring to the property known as "LA 190", is hereby
amended by deleting it in its entirety and replacing it with the following text:
"200 Affiliated Dr., Xxxxxxxxx, LA 70518 (LA 190)"
In addition, pursuant to Section 12.14 of the Agreement, the parties
hereto have mutually agreed to the forms of the (a) Transition Services
Agreement, (b) Cure Escrow Agreement, (c) Deposit Escrow Agreement, (d)
Indemnity Escrow Agreement and (e) Schedules to the Agreement, including
Schedules 3.2, 3.2(d) and 8.11, each of which is attached hereto as Exhibit A
(Transition Services Agreement), Exhibit B (Cure Escrow Agreement), Exhibit C
(Deposit Escrow Agreement), Exhibit D (Indemnity Escrow Agreement) and Exhibit E
(Schedules), respectively.
General Counsel
August 4, 2003
Page 14
If the terms set forth above correctly reflect your understanding,
please execute a copy of this letter and return it to us at your earliest
convenience. Upon receipt by us of such executed copy, this letter shall
constitute an amendment to the Agreement binding on all parties thereto with
respect to the matters set forth herein. Except as otherwise specifically set
forth herein, nothing contained herein shall be deemed to constitute a waiver or
amendment to the Agreement. This amendment is limited solely for the purposes
and to the extent expressly set forth herein, and except as expressly modified
hereby, the terms, provisions and conditions of the Agreement shall remain in
full force and effect and are hereby ratified and confirmed in all respects.
[remainder of page intentionally left blank]
Very truly yours,
THE XXXXXXX COMPANIES, INC.
/s/ XXX XXXXXXX
-------------------------------------
By: Xxx Xxxxxxx
Its: CRO
XXXXXXX TRANSPORTATION
SERVICE, INC.
/s/ XXXXXXX X. MAY, JR.
-------------------------------------
By: Xxxxxxx X. May, Jr.
Its: President
XXXXXXX INTERNATIONAL LTD.
/s/ XXXXXXX X. MAY, JR.
-------------------------------------
By: Xxxxxxx X. May, Jr.
Its: President
PIGGLY WIGGLY COMPANY
/s/ XXXXX X. XXXXXXXX
-------------------------------------
By: Xxxxx X. Xxxxxxxx
Its: President
RFS MARKETING SERVICES, INC.
/s/ XXXXXXX X. MAY, JR.
-------------------------------------
By: Xxxxxxx X. May, Jr.
Its: President
XXXXXXX FOODS OF TEXAS L.P.
By: Xxxxxxx Companies, Inc.
Its: General Partner
/s/ XXX XXXXXXX
-------------------------------------
By: Xxx Xxxxxxx
Its: CRO
E-15
XXXXXXX FOODS MANAGEMENT
CO., L.L.C.
By: Xxxxxxx Companies, Inc.
Its: Sole Member
/s/ XXX XXXXXXX
-------------------------------------
By: Xxx Xxxxxxx
Its: CRO
XXXXXXX FOREIGN SALES CORPORATION
/s/ XXXXXXX X. MAY, JR.
-------------------------------------
By: Xxxxxxx X. May, Jr.
Its: Vice President, Treasurer
and Assistant Secretary
ABCO FOOD GROUP, INC.
/s/ XXXXX X. XXXXXX
-------------------------------------
By: Xxxxx X. Xxxxxx
Its: Vice President
ABCO MARKETS, INC.
/s/ XXXXXXX X. MAY, JR.
-------------------------------------
By: Xxxxxxx X. May, Jr.
Its: President
ABCO REALTY CORP.
/s/ XXXXXXX X. MAY, JR.
-------------------------------------
By: Xxxxxxx X. May, Jr.
Its: President
ACCEPTED AND AGREED:
C&S ACQUISITION LLC
/s/ XXXX XXXXX
------------------------------------
By: Xxxx Xxxxx
Its: Executive Vice President
C&S WHOLESALE GROCERS, INC.
/s/ XXXX XXXXX
------------------------------------
By: Xxxx Xxxxx
Its: Executive Vice President
