EXHIBIT 1
EXCLUSIVITY AGREEMENT
EXCLUSIVITY AGREEMENT, dated as of April 26, 2001, between The
Smithfield Companies, Inc., a Virginia corporation (the "Company"), and
Smithfield Foods, Inc., a Virginia corporation ("SFI").
WHEREAS, the parties have engaged in preliminary, non-binding
discussions regarding the possible acquisition of the Company by SFI; and
WHEREAS, in connection therewith, the parties desire to memorialize
their understandings regarding such negotiations and the exclusivity thereof.
NOW, THEREFORE, in consideration of the foregoing and other good and
valuable consideration, and intending to be legally bound, the parties hereto
agree as follows:
1. Good Faith Negotiations. The parties hereto agree that, during the
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Exclusivity Period (as defined below), they shall engage in good faith
negotiations with the intention of executing a merger agreement providing for
the acquisition of the Company by SFI or a wholly-owned subsidiary thereof. The
parties hereto acknowledge that it is in their respective best interests to
conduct discussions on an exclusive basis.
2. Exclusivity. The Company agrees that it shall not, at any time
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during the twenty (20) day period commencing on the date hereof (the
"Exclusivity Period"), directly or indirectly, through any officer, director,
employee, agent or otherwise, solicit, initiate or encourage submission of
proposals or offers from any person other than SFI relating to any acquisition
or purchase of all or (other than in the ordinary course of business) a
substantial portion of the assets of, or any equity interest in, the Company or
any business combination involving the Company, or participate in any
negotiations regarding, or furnish to any other person any non-public
information with respect to, or otherwise cooperate in any way with, or assist
or participate in, facilitate or encourage, any effort or attempt by any other
person other than SFI to do or seek any of the foregoing. During the Exclusivity
Period, (a) the Company shall promptly advise SFI if any such proposal or offer,
or any inquiry or contact with any person with respect thereto, is made, shall
promptly inform SFI of all the terms and conditions thereof, and shall furnish
to SFI copies of any such written proposal or offer and the contents of any
communications in response thereto, and (b) the Company shall not waive any
provisions of any "standstill" agreements between the Company and any party.
3. Successors and Assigns. This Agreement shall inure to the benefit of
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and be binding upon the parties hereto and their respective permitted successors
and assigns.
4. Governing Law. This Agreement shall be governed by and construed in
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accordance with the laws of the Commonwealth of Virginia.
5. Entire Agreement. This Agreement constitutes the entire agreement
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between the parties with respect to the subject matter hereof and supersedes any
prior oral or written agreements related thereto.
6. Amendments and Waivers. Neither this Agreement nor any of the terms
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hereof may be terminated, amended or waived orally, but only by an instrument in
writing signed by the party against which enforcement of the termination,
amendment or waiver is sought. The performance or observance of any provision of
this Agreement may be waived in whole or in part and any period of time relating
to such performance or observance may be extended from time to time, as agreed
by the parties hereto.
7. Counterparts. This Agreement may be executed in two or more
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counterparts, each of which shall be deemed an original, and it shall not be
necessary in making proof of this Agreement to produce or account for more than
one such counterpart.
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IN WITNESS WHEREOF, each of the parties hereto has caused this
Exclusivity Agreement to be duly executed on its behalf by its officer thereunto
duly authorized, all as of the day and year first above written.
THE SMITHFIELD COMPANIES, INC.
By: /s/ Xxxxxxx X. Xxxxxx
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Name: Xxxxxxx X. Xxxxxx
Its: President
SMITHFIELD FOODS, INC.
By: /s/ Xxxxxxx X. Xxxx
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Name: Xxxxxxx X. Xxxx
Its: Secretary and Associate General Counsel
