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EXHIBIT 7.2
REGISTRATION RIGHTS AGREEMENT
THIS REGISTRATION RIGHTS AGREEMENT entered into this 20th day of December,
1995 between SMITHFIELD FOODS, INC., a Delaware corporation ("Company"), and
XXXXXXXX BRANDS INTERNATIONAL, INC., a New Jersey corporation ("Holder").
W I T N E S S E T H:
WHEREAS, the Holder is the owner of 1,094,273 shares of the Company's issued
and outstanding common stock, par value Fifty Cents ($.50) per share received
from the Company as partial consideration for the transfer of certain shares in
Xxxx Xxxxxxx & Co. ("Common Stock" or "Shares") at the date hereof;
WHEREAS, in connection with the issuance of such Shares to the Holder, the
Company agreed to provide the Holder with certain rights to require the Company
to register the sale by the Holder of such Shares with the Securities and
Exchange Commission (the "Commission") and applicable state securities
agencies.
NOW, THEREFORE, in consideration of the mutual promises and covenants
contained herein, the parties agree as follows:
1. Demand Registration Rights.
1.1. On any two (2) separate occasions, upon the written request of the
Holder given on or before December 31, 2000, the Company will prepare and file,
promptly after such request and in no case more than sixty (60) days after
receipt of such request, and thereafter use its best efforts to cause to become
effective a registration statement ("Registration Statement") on a proper form
to be selected by the Company under and complying with the Securities Act of
1933, as amended (the "Act"), covering such number of Shares of Common Stock as
shall be specified in the Holder's request; provided, however, that the Company
shall not be obligated to register Shares with a market value of less than Five
Million and 00/100 Dollars ($5,000,000.00) pursuant to any such request, market
value to be measured based on the National Association of Securities Dealers
Automated Quotation System ("NASDAQ") last sales price on the day two (2) days
prior to the date of such request.
1.2. If the Holder so requests, the offering or distribution of Shares
under this Section 1 shall be pursuant to a firm commitment underwriting. The
managing underwriter shall be a nationally recognized investment banking firm
selected by the Holder, but subject to the approval of the Company, which
approval shall not be unreasonably withheld. The Company will enter into an
underwriting agreement with such managing underwriter containing
representations, warranties and agreements not substantially
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different from those customarily included by an issuer in underwriting
agreements with respect to secondary distribution; provided, however, that the
Holder shall be entitled to negotiate the underwriting discounts and
commissions and other fees of such underwriter payable by the Holder.
1.3. No securities to be sold by the Company or any security holder of the
Company shall be included in any Registration Statement filed pursuant to this
Section 1, unless (i) the offering is pursuant to a firm commitment
underwriting and the managing or principal underwriter shall have consented to
the inclusion of such other securities; and (ii) all the Shares requested to be
included by the Holder shall be so included.
1.4. The Company shall be entitled to postpone the filing of any
Registration Statement otherwise required to be prepared and filed by it
pursuant to this Section 1 if, at the time it receives a request for
registration, (a) (i) the Company would, in accordance with the written advice
of its outside counsel, find it appropriate to disclose in the Prospectus
information not otherwise then required by law to be publicly disclosed and
(ii) in the judgment of the Company's Board of Directors, as such judgment is
set forth in a resolution of the Board of Directors (or the executive committee
thereof), there is a reasonable likelihood that such disclosure, or any other
action to be taken in connection with the Prospectus, would materially and
adversely affect any existing or prospective material business situation,
transaction or negotiation or otherwise materially and adversely affect the
Company, or (b) the Company or any of its Subsidiaries would be required to
prepare any financial statements other than those which it customarily prepares
in the ordinary course of its business, or (c) it would be materially
detrimental to the Company and its shareholders for the Company to immediately
proceed with the filing of a Registration Statement; provided, that the
duration of such delay shall not exceed ninety (90) days; and provided further,
that the Company shall promptly make such filing as soon as the conditions
which permit it to delay such filing no longer exist; and provided further that
in the event of any such deferral, the Holder shall have the right to withdraw
its request for Registration and such withdrawn request shall not be considered
one of the Holder's two permitted requests for registration under Section 1.1
hereof.
1.5. As to each Registration Statement, insofar as the methods of
distribution proposed to be used are not reflected in the last prospectus
(including any amendments or supplements thereto) filed by the Company under
the Act, the Holder will provide the Company with a description of the method
or methods of distribution of Shares from time to time contemplated by the
Holder
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and the Company shall file any and all amendments and supplements necessary to
include such description in such Registration Statement. Nothing in this
Agreement, however, shall be construed to require the Company to register any
proposed offering pursuant to "shelf registration" procedures contemplated by
Rule 415 under the Act, or any successor provision.
1.6. As to each Registration Statement, in the event that the Company
believes the last prospectus (including any amendments or supplements thereto)
filed under the Act may contain misleading statements or material omissions,
the Company shall notify the Holder in writing and the Holder hereby agrees to
immediately cease utilizing such prospectus for the sale of Shares, and the
Company agrees, as soon thereafter as may be practicable, to amend or
supplement such prospectus so as to meet the requirements of the Act, and to
notify the Holder of such action.
2. Piggy-Back Registration Rights.
2.1. If at any time prior to December 31, 2000, the Company shall propose
to file a Registration Statement for the purpose of effecting a primary
offering under the Act on Form X-0, X-0 or S-3 or any equivalent general form
for registration of equity securities under the Act with respect to a public
offering of any Company Common Stock, the Company shall, as promptly as
practicable but, in no event later than thirty (30) days prior to the proposed
filing date, give notice of such intention to the Holder and shall include in
such Registration Statement all Shares as the Holder shall request, within ten
(10) days of the giving of such notice, subject to the limitations that the
Company shall not be obligated to register for the Holder fewer than the lesser
of (i) Shares with a market value of less than Five Million and 00/100 Dollars
($5,000,000.00), market value to be measured as of the date of such request, or
(ii) the aggregate number of Shares still held by the Holder, and the inclusion
of such Shares may be conditioned or restricted if, in the good faith opinion
of the managing underwriter (or underwriters) of the securities to be sold (or,
in the absence thereof, of the principal investment banker acting on behalf of
the Company in effecting such sale) for which such Registration Statement is
being filed, such inclusion can reasonably be expected to have a material
adverse impact on the offering of the securities being so registered. If the
number of Shares is so restricted, then no Shares nor any securities of other
securityholders shall be included in the offering unless all securities which
the Company is attempting to sell are included therein, and any reduction
required thereafter shall be made pro rata among the Holder and the other
selling securityholders; provided, however, that such rights of the Holder to
share pro rata
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shall be subject to any prior rights which the Company may have granted to
others before the date of this Agreement.
2.2. The Company may, without the consent of the Holder, withdraw any
Registration Statement filed pursuant to this Section 2 and abandon any such
proposed offering in which the Holder requested to participate. The Holder may
withdraw any or all of the Shares held by the Holder from a Registration
Statement filed or proposed to be filed pursuant to this Section 2 at any time
prior to the effectiveness of such Registration Statement.
2.3. The notice from the Company to the Holder under this Section 2 shall
specify whether the Securities to be included in such registration for a sale
by the Company are to be sold through underwriters in a firm commitment
offering. If Shares of the Holder are included in such an offering, they shall
be included on the same terms (including the same underwriting discount or
commission) applicable to the securities of the Company.
3. Covenants of the Holder.
3.1. Any request for registration made by the Holder shall specify the
number of Shares as to which such request relates, express the Holder's present
intention to offer such Shares for distribution and contain an undertaking to
provide all such information and materials and take all such actions and
execute all such documents as may be required in order to permit the Company to
comply with all applicable requirements of the Commission and to obtain
acceleration of the effective date of the Registration Statement.
3.2. The Holder agrees that in disposing of any Common Stock, it will
comply with all applicable securities laws, including Rules 10b-5, 10b-6 and
10b-7 promulgated under the Securities Exchange Act of 1934, as amended. The
Holder agrees to deliver the current prospectus contained in the Registration
Statement, and such supplements thereto, if any, as may be appropriate, to all
persons as required by the Act, the rules promulgated thereunder, and any
applicable "blue sky" laws and regulations in connection with the disposition
of its Common Stock.
4. Covenants of the Company.
So long as the Company is under an obligation pursuant to the provisions of
Section 1 hereof, the Company shall:
4.1. Prepare and file with the Commission such amendments and supplements
to such Registration Statement and the prospectus forming part of such
Registration Statement as may be
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necessary to keep such Registration Statement effective for such period as
shall be necessary to complete the marketing of the Shares included therein,
but in no event for longer than three (3) months after the date the Shares may
first be sold, not including any period during which the Holder is prohibited
from selling any Shares;
4.2. Furnish to the Holder such number of copies of a prospectus including,
without limitation, a preliminary prospectus, in conformity with the
requirements of the Act, and such other documents as the Holder may reasonably
request in order to facilitate the public sale or other disposition of such
Shares;
4.3. Use reasonable efforts (i) to register or qualify, not later than the
effective date of any Registration Statement filed pursuant to this Agreement,
the Shares covered by such Registration Statement under the securities or Blue
Sky laws of such jurisdictions within the United States as the Holder may
reasonably request, and (ii) to do any and all other reasonable acts or things
which may be necessary or advisable to enable the Holder to consummate the
public sale or other disposition in such jurisdiction of such Shares; provided,
however, that the Company will not be required to qualify generally to do
business in any jurisdiction where it is not then so qualified or to take any
action which would subject it to general service of process or taxation in any
jurisdiction where it is not then so subject;
4.4. Promptly notify the Holder, at any time when a prospectus relating to
the Shares being distributed is required to be delivered under the Act, of the
happening of any event as a result of which the prospectus included in such
Registration Statement, as then in effect, includes an untrue statement of
material fact or omits to state a material fact required to be stated therein
or necessary to make the statements therein not misleading in the light of the
circumstances then existing and, at the request of the Holder, prepare as soon
as practicable thereafter, file with the Commission and furnish to the Holder
a reasonable number of copies of a supplement to, or an amendment of, such
prospectus as may be necessary, or make any other appropriate filing with the
Commission pursuant to the Securities Exchange Act of 1934, as amended, which
will be incorporated by reference into the Registration Statement so that, as
thereafter delivered to the purchasers of such Shares, such prospectus shall
not include an untrue statement of a material fact or omit to state a material
fact required to be stated therein or necessary to make the statements therein
not misleading in light of the circumstances then existing.
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4.5. Use reasonable efforts to furnish, at the request of the Holder or any
underwriter of any distribution of the Shares, an opinion of legal counsel to
the Company, covering such matters as are typically covered by opinions of
issuer's counsel in underwritten offerings under the Act; and
4.6. Enter into an agreement with the underwriters for such offering in
which the Company shall provide indemnities similar to those described in
Section 6 hereof to the underwriters and in which the Company shall make the
usual warranties and representations made by issuers of equity securities to
underwriters.
5. Costs and Expenses.
5.1. With respect to the initial demand registration under Section 1.1
hereof, the Company shall bear all Registration Costs (as defined below) and
Holder shall bear all Offering Costs (as defined below).
5.2. With respect to the second demand registration under Section 1.1
hereof, Holder shall bear all reasonable Registration Costs not in excess of
$100,000.00 and all Offering Costs. The balance of the Registration Costs, if
any, shall be paid by the Company.
5.3. For purposes hereof, (a) "Registration Costs" means the entire cost
and expense of any registration made pursuant to this Agreement, including,
without limitation, all registration and filing fees, printing expenses, the
fees and expenses of the Company's counsel and its independent accountants and
all other out-of-pocket expenses incident to the preparation, printing and
filing under the Act of the Registration Statement and all amendments and
supplements thereto, the cost of furnishing copies of each preliminary
prospectus, each final prospectus and each amendment or supplement thereto to
underwriters, brokers and dealers and other purchasers of the securities so
registered, and the costs and expenses incurred in connection with the
qualification of the securities so registered under "blue sky" or other state
securities laws, and (b) "Offering Costs" means the fees and expenses of
counsel and accountants of the Holder, all transfer taxes, underwriting
discounts and commissions attributable to Shares registered at the request of
the Holder, and in any registration made pursuant to Section 2 hereof, all
filing fees attributable to Shares registered at the request of the Holder.
5.3. All such fees and expenses payable by Holder shall, if appropriate, be
prorated among all selling securityholders.
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6. Indemnification.
6.1. In connection with any registration effected pursuant to this
Agreement, the Company will indemnify the Holder, its officers, directors and
each underwriter of Common Stock as well as any person who controls the Holder
or such underwriters against all claims, losses, damages, liabilities and
expenses resulting from any untrue statement or alleged untrue statement of a
material fact contained in a prospectus or in any related Registration
Statement, notification or similar filing under the securities laws of any
jurisdiction or from any omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make the statements
therein not misleading, except insofar as the same may have been based upon
information furnished in writing to the Company by the Holder or such
underwriter expressly for use therein and used in accordance with such writing.
6.2. The Holder, by requesting any such registration, agrees to furnish to
the Company such information concerning it as may be requested by the Company
and which, in the reasonable opinion of counsel for the Company, is necessary
or required by then applicable securities laws and the rules and regulations
thereunder in connection with any Registration or qualification of the Common
Stock and to indemnify the Company, its officers and directors and each
underwriter (and any persons who control the Company or the underwriter) of the
Shares, if any, against all claims, losses, damages, liabilities and expenses
resulting from the utilization of such information furnished to the Company
expressly for use therein and from any omission or alleged omission therefrom.
6.3. If any action is brought or any claim is made against any party
entitled to be indemnified pursuant to this Section 6 in respect of which
indemnity may be sought against the indemnitor pursuant to this Section 6, such
party shall promptly notify the indemnitor in writing of the institution of
such action or the making of such claim and the indemnitor shall assume the
defense of such action or claim, including the employment of counsel and
payment of expenses. Such indemnified party shall have the right to employ its
or their own counsel in any such case, but the fees and expenses of such
counsel shall be at the expense of such party unless the employment of such
counsel shall have been authorized in writing by the indemnitor in connection
with the defense of such action or claim or such indemnified party or parties
shall have reasonably concluded that there may be defenses available to it or
them which are different from or additional to those available to the
indemnitor (in which case the indemnitor shall not have the right to direct any
different or additional
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defense of such action or claim on behalf of the indemnified party or parties),
in any of which events such fees and expenses of not more than one additional
counsel for the indemnified parties shall be borne by the indemnitor. Except
as expressly provided above, if the indemnitor shall not previously have
assumed the defense of any such action or claim, at such time as the indemnitor
does assume the defense of such action or claim, the indemnitor shall
thereafter be liable to any person indemnified pursuant to this Agreement for
any legal or other expenses subsequently incurred by such person in
investigating, preparing or defending against such action or claim. Anything
in this Section 6 to the contrary notwithstanding, the indemnitor shall not be
liable for any settlement of any such claim or action effected without its
written consent.
6.4. If the indemnification provided for in this Agreement is unavailable
or insufficient to hold harmless an indemnified party in respect of any losses,
claims, damages, liabilities or actions referred to therein, as determined by a
court of competent jurisdiction, then each indemnifying party shall, in lieu of
indemnifying such indemnified party, contribute to the amount paid or payable
by such indemnified party as a result of such losses, claims, damages,
liabilities or actions in such proportion as is appropriate to reflect the
relative fault of the indemnifying party, on the one hand, and the indemnified
party, on the other, in connection with the statements or omissions which
resulted in such losses, claims, damages, liabilities or actions as well as any
other relevant equitable considerations. The relevant fault shall be
determined by reference to, among other things, whether the untrue or alleged
untrue statement of a material fact relates to information supplied by the
indemnifying party, on the one hand, or the indemnified party on the other
hand, and the parties' relative intent, knowledge, access to information and
opportunity to correct or prevent such statement or omission. The Company and
the Holder agree that it would not be just and equitable if contributions
pursuant to this Section 6 were determined by pro rata allocation or by any
other method of allocation which would not take account of the equitable
considerations referred to in this Section 6. The amount paid or payable by an
indemnifying party as a result of the losses, claims, damages, liabilities or
actions in respect thereof referred to in this Section 6 shall be deemed to
include any legal or other expenses reasonably incurred by such indemnified
party in connection with investigating or defending any such action or claim.
No person guilty of fraudulent misrepresentations (within the meaning of
Section 11(f) of the Act) shall be entitled to contribution from any person who
is not also guilty of such fraudulent misrepresentation.
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7. Miscellaneous.
7.1. Any notice, request, demand, waiver, consent, approval or other
communication which is required or permitted hereunder shall be in writing and
shall be deemed given only if (i) delivered personally or by courier or (ii)
sent by registered or certified mail, postage prepaid, or (iii) sent by
confirmed facsimile with the original to follow by first class mail, postage
prepaid, as follows:
If to the Company: Xxxxxxxx Brands International, Inc.
000 Xxxx Xxxxx Xxxxxx
Xxxxxxxxxx, Xxxx 00000
Attention: General Counsel
Facsimile No: (000) 000-0000
With a copy to: Xx. Xxxx X. Xxxxxxxx
Xxxxxxx, Xxxxxxxx & Xxxxxxx
1800 Provident Tower
Xxx Xxxx Xxxxxx Xxxxxx
Xxxxxxxxxx, XX 00000
Facsimile No: (000) 000-0000
If to the Holder: Smithfield Foods, Inc.
000 Xxxxx Xxxxxx Xxxxxx
Xxxxxxxxxx, Xxxxxxxx 00000
Attention: Xxxxxx X. Xxxxx III Facsimile
No: (000) 000-0000
With a copy to: Xx. Xxxxx X. Xxxxxxxxxxxx
Xxxxxxx & Xxxx, S.C.
000 Xxxxx Xxxxx Xxxxxx
Xxxxxxxxx, XX 00000
Facsimile No: (000) 000-0000
Mr. Xxx Xxxxx Xxxxxxx
XxXxxxx, Xxxxx, Battle & Booth, LLP
One Xxxxx Center
000 Xxxx Xxxx Xxxxxx
Xxxxxxxx, XX 00000
Facsimile: (000) 000-0000
or to such other address as the addressee may have specified in a notice duly
given to the sender as provided herein. Such notice, request, demand, waiver,
consent, approval or other communication will be deemed to have been given as
of the date so delivered, mailed or received by facsimile transmission.
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7.2. This Agreement shall be binding upon, and shall inure to the benefit
of, the parties hereto and their respective permitted successors and assigns.
7.3. This Agreement shall be governed by and construed under the laws of
the State of Virginia.
7.4. The provisions of this Agreement: (a) apply only to Shares of Common
Stock received as a result of the transaction described in this Agreement; and
(b) except as provided in Paragraphs 7.5 and 7.6, below, are (i) personal to
the Holder and shall not be assignable in whole or in part, and (ii) shall
terminate as to any shares of Common Stock sold by the Holder.
7.5. Holder (or any successor to its rights hereunder) may transfer all or
any portion of the Shares to one or more Affiliates and such Affiliate or
Affiliates shall be entitled to all of the benefits of this Agreement subject
to the following conditions:
(a) So long as any of the Shares shall be registered to Holder, Holder
shall be entitled to exercise all of the rights of the Holder hereunder (the
"Rights") on behalf of itself and each of its Affiliates; provided, however,
upon written notice to Company, Holder may transfer the Rights to any
Affiliate who owns Shares and in such event such Affiliate shall act as the
substitute Holder for purpose of this Agreement and thereafter such
substitute Holder shall hold and exercise all Rights on behalf of itself,
Holder and each of the Affiliates.
(b) The Company shall only be required to give notice to and to accept
direction from the Holder or substitute Holder as set forth above, and such
direction shall be binding on Holder and each of its Affiliates.
For purposes of Paragraphs 7.5 and 7.6 hereof, "Holder" means Holder and its
successors and assigns, and "Affiliate" means an Affiliate (as defined in the
Purchase Agreement) of Xxxxxxxx Brands International, Inc.
7.6. Subject to the limitations set forth below, Holder (or any successor
to its rights hereunder) may also transfer some or all of the Rights in
connection with a sale of the Shares, or a portion thereof, provided that the
following conditions shall have been satisfied:
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(a) If Holder desires to transfer any Shares (the "Subject Shares")
together with any of the Rights (the "Subject Interest") to a party other
than an Affiliate, Holder shall notify the Company ("Holder's Notice") in
writing that Holder desires to transfer the Subject Interest, which notice
shall set forth the number of Shares desired to be transferred and specify
which Rights are to be transferred.
(b) During the 30-day period following the Company's receipt of Holder's
Notice (the "Notice Period"), Holder will not transfer the Subject Interest
to an entity (a "Transferee") that has not been approved by the Company,
which approval shall not be unreasonably withheld. The Company shall give
Holder written notice of its approval or disapproval of any proposed
Transferee (the "Transfer Notice") within 2 business days after receipt of
written notice from Holder of the identity of any proposed Transferee (a
"Transferee Notice"). If the Company does not give a Transfer Notice within
2 business days, the proposed Transferee identified in the Transferee Notice
shall be conclusively deemed to have been approved by the Company. There
shall be no limit on the number of Notices which Holder may give during the
Notice Period. A Notice may identify more than one potential Transferee.
(c) Following the Notice Period, Holder shall be entitled to transfer the
Subject Interest to any entity, including any entity previously disapproved
by the Company; provided, that if the Subject Interest has not been
transferred by Holder within one year after the Notice Period, the provisions
of Subparagraph (a) and (b) above will once again apply to any proposed
transfer of the Subject Interest.
(d) Subject to the provisions of Subparagraph (b) above, and the
restrictions set forth in this subparagraph, Holder shall have the right to
transfer to any Transferee all of the Rights accorded by this Agreement with
respect to any Subject Shares while retaining to Holder all of the Rights
accorded by this Agreement with respect to any Shares not included in the
Subject Shares (the "Remaining Shares"). The Rights appurtenant to any
Remaining Shares shall continue to be subject to the provisions of
Subparagraph (b), above. Holder shall have the right to determine the extent
of the Rights to be transferred to any Transferee, including whether any
transfer shall entitle the Transferee to one, two or no demand registrations
under Section 1.1 hereof and, if the entitlement is one demand registration,
whether it is governed by Section 5.1 or Section 5.2; provided that under no
circumstances shall (i) the Company be required to effectuate more
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than a total of two demand registrations pursuant to Section 1.1 of this
Agreement; and (ii) no more than two (2) parties may hold piggyback
registration rights granted under Paragraph 2, above.
(e) The provisions of this Section 7.6 shall only apply to the transfer
of the Subject Shares with appurtenant Rights and shall not be construed to
limit or restrict Holder's right to sell or otherwise transfer Shares without
Rights or in any way require the Company's approval of thereof.
7.7. If the Common Stock of the Company covered by this Agreement is
converted into any other security of the Company or any other corporation, the
terms of this Agreement shall apply with full force and effect to any such
other security and the obligations of the Company to effect registration shall
include such other filings, qualifications, notices and similar acts as may be
necessary to enable the Holder to realize the benefits of registration provided
by this Agreement.
7.8. This Agreement may be executed in two (2) or more counterparts, each
of which shall be deemed an original, but all of which together shall
constitute one and the same agreement.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed as of the date first above written.
WITNESSES: SMITHFIELD FOODS, INC.
/s/ Xxxxx X. Xxxxxxxxxxxx By: /s/Xxxxxx X. Xxxxxx XX
---------------------------- --------------------------
Xxxxxx X. Xxxxxx XX,
Vice President
XXXXXXXX BRANDS INTERNATIONAL,
INC.
/s/ Xxxxx X. Xxxxxxxxxxxx By: /s/Xxxxxx X. Xxxxx
---------------------------- --------------------------
Xxxxxx X. Xxxxx,
Vice President
323410.1
