Exhibit 2.2
EXECUTION COPY
SEPARATION AGREEMENT
DATED AS OF JUNE 12, 2002
BETWEEN
X. X. XXXXX COMPANY
AND
SKF FOODS INC.
Table of Contents
Page
ARTICLE I DEFINITIONS....................................................................... 2
Section 1.01 General............................................................... 2
Section 1.02 References to Time.................................................... 11
Section 1.03 References to Schedules............................................... 11
ARTICLE II THE CONTRIBUTION................................................................. 11
Section 2.01 Spinco Assets and Excluded Assets; Spinco Liabilities and
Excluded Liabilities.................................................. 11
Section 2.02 Business Separation................................................... 16
Section 2.03 Documents Relating to Transfers of Spinco Assets and Assumption
of Spinco Liabilities................................................. 18
Section 2.04 Governmental Approvals and Consents................................... 18
Section 2.05 Novation of Liabilities............................................... 19
Section 2.06 Certificate of Incorporation; By-laws................................. 20
Section 2.07 Issuance of Stock..................................................... 20
Section 2.08 Other Transaction Agreements.......................................... 21
Section 2.09 Financing............................................................. 21
Section 2.10 Registration and Listing Prior to the Distribution Date............... 21
ARTICLE III THE DISTRIBUTION................................................................ 22
Section 3.01 Heinz Record Date and Distribution Date............................... 22
Section 3.02 The Distribution Agent................................................ 22
Section 3.03 Delivery of Share Certificates to the Distribution Agent.............. 22
Section 3.04 The Distribution...................................................... 22
Section 3.05 Timing of the Distribution............................................ 22
ARTICLE IV ADDITIONAL COVENANTS............................................................. 23
Section 4.01 Access to Information................................................. 23
Section 4.02 Production of Witnesses; Records...................................... 23
Section 4.03 Retention of Records.................................................. 24
Section 4.04 No Representations or Warranties...................................... 24
Section 4.05 Use of Heinz Names.................................................... 24
Section 4.06 Product Deductions and Returns........................................ 25
Section 4.07 Brickwork and Northside Complex Signage............................... 26
ARTICLE V MUTUAL RELEASES; INDEMNIFICATION.................................................. 26
Section 5.01 Release of Pre-Closing Claims......................................... 26
Section 5.02 Indemnification by Spinco............................................. 27
Section 5.03 Indemnification by Heinz.............................................. 27
Section 5.04 Terminal Island Environmental Indemnity............................... 28
Section 5.05 Indemnification Procedures............................................ 28
Section 5.06 Indemnification Obligations Net of Insurance Proceeds and Other
Amounts............................................................... 30
Section 5.07 Additional Matters.................................................... 30
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ARTICLE VI INSURANCE........................................................................ 31
Section 6.01 Insurance Coverage.................................................... 31
Section 6.02 Rights Under Insurance Policies....................................... 31
Section 6.03 Spinco Insurance Coverage After the Distribution Date................. 32
Section 6.04 Responsibilities for Self-insured Obligations and Other
Obligations........................................................... 32
Section 6.05 Claims Administration................................................. 33
Section 6.06 Procedures Regarding Insufficient Limits of Liability................. 33
Section 6.07 Cooperation........................................................... 33
Section 6.08 No Assignment or Waiver............................................... 33
Section 6.09 No Liability.......................................................... 33
Section 6.10 No Restrictions....................................................... 33
Section 6.11 Further Agreements.................................................... 33
ARTICLE VII CONDITIONS TO THE CONTRIBUTION AND DISTRIBUTION................................. 34
Section 7.01 Conditions to the Distribution........................................ 34
ARTICLE VIII TERMINATION.................................................................... 34
Section 8.01 Termination........................................................... 34
Section 8.02 Effect of Termination................................................. 34
ARTICLE IX MISCELLANEOUS.................................................................... 34
Section 9.01 Entire Agreement...................................................... 34
Section 9.02 Expenses.............................................................. 34
Section 9.03 Governing Law......................................................... 34
Section 9.04 Notices............................................................... 35
Section 9.05 Amendment and Modification............................................ 36
Section 9.06 Assignment; Binding Effect............................................ 36
Section 9.07 No Third Party Beneficiaries.......................................... 37
Section 9.08 Survival.............................................................. 37
Section 9.09 Counterparts.......................................................... 37
Section 9.10 Certain Construction Rules............................................ 37
Section 9.11 Waiver................................................................ 37
Section 9.12 Severability.......................................................... 37
Section 9.13 Limited Liability..................................................... 38
EXHIBITS
Exhibit A Form of Tax Separation Agreement
Exhibit B Form of Trademark License Agreement
Exhibit C Form of Transition Services Agreement
Exhibit D-1 Form of Co-Pack Agreement
Exhibit D-2 Form of Co-Pack Agreement
Exhibit D-3 Form of Co-Pack Agreement
Exhibit D-4 Form of Co-Pack Agreement
Exhibit E Form of Joint Procurement Memorandum of Understanding
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Exhibit F Form of Northside Lease and Facility Sharing Agreement
Exhibit G Form of Shared Heinz IP License Agreement
Exhibit H Form of Shared Spinco IP License Agreement
Exhibit I Form of Xxxxx Warehouse and Transportation Agreement
Exhibit J Form of Trademark and Cooperation Agreement
Exhibit K Form of Right of Use Agreement
SCHEDULES
Schedule 1.01(a) Canadian Operating Services Term Sheet
Schedule 1.01(b) U.S. Food Services Term Sheets
Schedule 2.01(a)(i) Owned Real Property and Facilities
Schedule 2.01(a)(ii) Leased Real Property
Schedule 2.01(a)(iii) Machinery and Equipment
Schedule 2.01(a)(v) Intellectual Property
Schedule 2.01(a)(vii) Contracts
Schedule 2.01(a)(viii) Licenses
Schedule 2.01(a)(xiii) Subsidiaries/Other Interests
Schedule 2.01(a)(xv) Data Communication Infrastructure
Schedule 2.01(b)(vii) Excluded Star-Xxxx Subsidiaries
Schedule 2.01(b)(viii) Real Property
Schedule 2.01(b)(xi) Other Excluded Assets
Schedule 2.02(e) Common Contracts
Schedule 2.02(f) Intercompany Agreements
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SEPARATION AGREEMENT
This SEPARATION AGREEMENT, dated as of June 12, 2002, is between X. X.
Xxxxx Company, a Pennsylvania corporation ("Heinz"), and SKF Foods Inc., a
Delaware corporation ("Spinco" and, together with Heinz, the "Parties").
W I T N E S S E T H:
WHEREAS, Heinz directly and indirectly through its Subsidiaries is
engaged in the Spinco Business;
WHEREAS, the Board of Directors of Heinz has determined that it would be
in the best interests of Heinz and its shareholders to separate the Spinco
Business from Heinz, contribute the Spinco Business to Spinco, distribute the
stock of Spinco to the shareholders of Heinz and, pursuant to an Agreement and
Plan of Merger, dated as of the date hereof (the "Merger Agreement"), between
Heinz, Spinco, Del Monte Foods Company, a Delaware corporation ("Del Monte"),
and Del Monte Corporation, a New York corporation and a wholly-owned subsidiary
of Del Monte ("Merger Sub"), merge Spinco with Merger Sub;
WHEREAS, Heinz has caused Spinco, which currently conducts no business
operations and has no assets or liabilities other than in connection with its
formation, to be incorporated as its wholly-owned subsidiary in order to
effectuate such transactions;
WHEREAS, prior to the Effective Time on the Closing Date, Heinz shall, (i)
transfer or cause to be transferred the Spinco Assets and the Spinco Liabilities
to Spinco in exchange for all of the issued and outstanding shares of Spinco
common stock, cash in an amount equal to the Bank Debt Amount and the Debt
Security (the "Contribution");
WHEREAS, following the Contribution, Heinz, upon the terms and subject to
the conditions set forth in this Agreement, shall distribute all of the issued
and outstanding shares of common stock of Spinco, par value $0.01 per share (the
"Spinco Common Stock"), on a pro rata basis (the "Distribution") to the holders,
as of the Heinz Record Date, of the outstanding shares of common stock of Heinz,
par value $0.25 per share ("Heinz Common Stock");
WHEREAS, immediately following the Distribution, Merger Sub, pursuant to
the Merger Agreement, shall merge with and into Spinco, with Spinco being the
Surviving Corporation (the "Merger"), resulting in Spinco becoming a
wholly-owned Subsidiary of Del Monte;
WHEREAS, the Parties intend that the Contribution and the Distribution
shall qualify under Sections 355 and 368 of the Code and for the Merger
Agreement to constitute a plan of reorganization as that term is defined in
Section 368 of the Code; and
WHEREAS, the Parties intend this Agreement to set forth the arrangements
between them regarding the Contribution and the Distribution.
NOW, THEREFORE, in consideration of the covenants and agreements set forth
in this Agreement, and for other good and valuable consideration, the receipt
and sufficiency of which are hereby acknowledged, the Parties, intending to be
legally bound hereby, agree as follows:
ARTICLE I
DEFINITIONS
Section 1.01 General. Unless otherwise defined herein, capitalized terms
used but not defined herein shall have the meanings set forth in the Merger
Agreement. As used in this Agreement, the following terms shall have the
following meanings (such meanings to be equally applicable to both the singular
and plural forms of the terms defined):
"Action" shall have the meaning specified in the Merger Agreement.
"Affiliate" shall mean, with respect to any specified Person, any
other Person that, directly or indirectly, controls, is controlled by or
is under common control with, such specified Person. For purposes of this
definition, "control" (including, with correlative meanings, the terms
"controlled by" and "under common control with"), as used with respect to
any Person, shall mean the possession, directly or indirectly, of the
power to direct or cause the direction of the management or policies of
such Person, whether through the ownership of voting securities, by
contract or otherwise; provided, however, that, for purposes of this
Agreement, no member of either Group shall be deemed to be an Affiliate of
any member of the other Group.
"Agreement" shall mean this Separation Agreement together with all
exhibits and schedules attached hereto.
"Assets" shall mean Heinz Assets or Spinco Assets, as the case may
be.
"Bank Account Amount" shall have the meaning specified in Section
2.01(a)(xvi).
"Bank Debt" shall have the meaning specified in Section 2.09.
"Bank Debt Amount" shall mean $800,000,000 plus an amount equal to
the sum of (i) the Excess Fee Amount, if any, plus (ii) the Bank Account
Amount, if any.
"Brickwork" shall mean the brickwork at the Northside Complex that
spells out the Heinz name.
"Business" shall mean the Retained Business or the Spinco Business,
as the case may be.
"Canadian Operating Services Agreement" shall mean the Canadian
Operating Services Agreement to be entered into prior to the Distribution
between Heinz and
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Spinco, in accordance with the terms of the Canadian Operating Services
Term Sheet set forth in Schedule 1.01(a) hereto.
"Closing" shall have the meaning specified in the Merger Agreement.
"Closing Date" shall have the meaning specified in the Merger
Agreement.
"Code" shall have the meaning specified in the Merger Agreement..
"Common Contract" shall have the meaning specified in Section
2.02(e).
"Confidentiality Agreement" shall have the meaning specified in the
Merger Agreement.
"Consents" shall mean any consents, waivers or approvals from, or
notification requirements to, any third parties, other than Governmental
Approvals.
"Contract" shall have the meaning specified in the Merger Agreement.
"Contribution" shall have the meaning specified in the Recitals
hereto.
"Co-Pack Agreements" shall mean the Co-Pack Agreements to be entered
into prior to the Distribution between Heinz and Spinco, in substantially
the forms of Xxxxxxxx X-0, X-0, X-0 and D-4 attached hereto, with such
additions, deletions and other modifications thereto as are mutually
agreed upon in writing by Heinz and Spinco, subject to receipt by Heinz
and Spinco of a Del Monte Consent.
"Data Communication Infrastructure" shall have the meaning set forth
in Section 2.01(a)(xv).
"Debt Security" shall mean the High Yield Debt Security or the
Senior Secured Notes, as the case may be.
"Debt Security Amount" shall mean $300,000,000.
"Delayed Transfer Assets" shall mean any Spinco Assets that this
Agreement or any other Transaction Agreement provides or contemplates are
to be transferred to Spinco and that require the removal of a Legal
Impediment or the receipt of a Consent or Governmental Approval to
transfer, which Legal Impediment is not removed or Consent or Governmental
Approval is not obtained on or prior to the Distribution Date.
"Delayed Transfer Assets and Liabilities Schedule" shall have the
meaning specified in Section 2.02(c).
"Delayed Transfer Liabilities" shall mean any Spinco Liabilities
that this Agreement or any other Transaction Agreement provides or
contemplates are to be assumed by Spinco and that require the removal of a
Legal Impediment or the receipt of a Consent or Governmental Approval for
the transfer and assumption of such Spinco
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Liabilities, which Legal Impediment is not removed or Consent or
Governmental Approval is not obtained on or prior to the Distribution
Date.
"Del Monte" shall have the meaning specified in the Recitals hereto.
"Del Monte Consent" shall have the meaning specified in the Merger
Agreement.
"Del Monte Professional Fees" shall have the meaning specified in
the Merger Agreement.
"Distribution" shall have the meaning specified in the Recitals
hereto.
"Distribution Agent" shall mean the distribution agent to be
appointed by Heinz to receive, on behalf of the holders of Heinz Common
Stock as of the Heinz Record Date, the shares of Spinco Common Stock which
such holders are entitled to receive pursuant to the Distribution, who
shall be the Exchange Agent (as defined in the Merger Agreement).
"Distribution Date" shall mean the date and time as of which the
Distribution shall be effected, to be determined by, or under the
authority of, the Board of Directors of Heinz consistent with the terms
and provisions of this Agreement and the Merger Agreement.
"Distribution Stock Certificate" shall have the meaning specified in
the Merger Agreement.
"Effective Time" shall have the meaning specified in the Merger
Agreement.
"Employee Benefits Agreement" shall mean the Employee Benefits
Agreement, dated as of the date hereof, between Heinz and Spinco.
"Environmental Claim" shall have the meaning specified in the Merger
Agreement.
"Engagement Letter" shall have the meaning specified in the Merger
Agreement.
"Environmental Law" shall have the meaning specified in the Merger
Agreement.
"Environmental Remediation" shall mean the investigation, treatment,
clean-up or other remediation of any Release of Hazardous Materials on,
at, under or emanating from the Terminal Island Property or any Hazardous
Materials which were disposed or Released at the Terminal Island Property.
"Excess Fee Amount" shall mean, to the extent the Del Monte
Professional Fees exceed $26,500,000 in the aggregate and to the extent
Heinz exercises its rights under Section 9.3(c) of the Merger Agreement,
an amount equal to the product of (A) three and (B) the Excess Liability
Amount.
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"Excess Liability Amount" shall have the meaning specified in the
Merger Agreement.
"Exchange Act" shall have the meaning specified in the Merger
Agreement.
"Excluded Assets" shall have the meaning specified in Section
2.01(b).
"Excluded Liabilities" shall have the meaning specified in Section
2.01(d).
"Excluded Star-Xxxx Subsidiaries" shall have the meaning specified
in Section 2.01(b)(vii).
"Facility" shall have the meaning specified in Section 2.01(a)(i).
"First Commitment Letter" shall have the meaning specified in the
Merger Agreement.
"Governmental Approvals" shall mean any notices, reports or other
filings to be made, or any consents, registrations, approvals, permits or
authorizations to be obtained from, any Governmental Authority.
"Governmental Authority" shall have the meaning specified in the
Merger Agreement.
"Group" shall mean the Heinz Group or the Spinco Group, as the case
may be.
"Hazardous Material" shall have the meaning specified in the Merger
Agreement.
"Heinz" shall have the meaning specified in the Preamble hereto.
"Heinz Assets" shall have the meaning specified in Section
2.05(a)(i).
"Heinz Common Stock" shall have the meaning specified in the
Recitals hereto.
"Heinz Entities" shall mean Heinz and all Subsidiaries of Heinz
immediately prior to the Distribution.
"Heinz Group" shall mean Heinz and all Subsidiaries of Heinz
immediately after the Distribution Date.
"Heinz Indemnitees" shall mean Heinz, each Affiliate of Heinz
immediately after the Distribution Date, each of their respective present
and former Representatives, each of the heirs, executors, successors and
assigns of any of the foregoing and each Person, if any, who controls
Heinz within the meaning of Section 15 of the Securities Act or Section 20
of the Exchange Act.
"Heinz Liabilities" shall mean any and all Liabilities that relate
to the Heinz Group that are not Spinco Liabilities, including the Excluded
Liabilities.
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"Heinz Record Date" shall mean the close of business on the date to
be determined by the Board of Directors of Heinz as the record date for
determining stockholders of Heinz entitled to receive the Distribution,
which date shall be the day of, or the business day immediately preceding
the day of, the Effective Time, but the close of business on such date
shall in any event precede the Effective Time.
"Heinz Subsidiaries" shall mean all Subsidiaries of Heinz
immediately after the Distribution Date.
"High Yield Debt Security" shall have the meaning specified in
Section 2.09.
"Indemnifying Party" shall mean the Person having the obligation to
indemnify pursuant to Article V.
"Indemnitee" shall mean a Person that has the right to
indemnification pursuant to Article V.
"Information" shall mean all records, books, contracts, work papers,
reports, plans, schedules and other documents, instruments, computer data
and other data and information of a Person.
"Insurance Policy" shall mean any insurance policy, contract of
insurance, other benefit or payment for the benefit of any Heinz Entity
which is issued or made by an insurance company which is not a member of
the Heinz Group, other than any insurance policy with respect to Heinz's
indemnification obligations under this Agreement.
"Intellectual Property" shall have the meaning specified in the
Merger Agreement.
"Joint Procurement Memorandum of Understanding" shall mean the Joint
Procurement Memorandum of Understanding to be entered into prior to the
Distribution between Heinz and Spinco, in substantially the form of
Exhibit E hereto, with such additions, deletions and other modifications
thereto as are mutually agreed upon in writing by Heinz and Spinco,
subject to receipt by Heinz and Spinco of a Del Monte Consent.
"Leased Real Property" shall have the meaning specified in Section
2.01(a)(ii).
"Legal Impediment" shall mean a legal impediment preventing or
restricting the transfer of a Spinco Asset or the assumption of a Spinco
Liability, as the case may be, in the Contribution as of the Distribution
Date.
"Liabilities" shall mean any and all losses, claims, charges, debts,
demands, damages, obligations, payments, costs and expenses, bonds,
indemnities and similar obligations, covenants, promises, guarantees, make
whole agreements and similar obligations, and other liabilities, including
all contractual obligations, whether absolute or contingent, inchoate or
otherwise, matured or unmatured, liquidated or unliquidated, accrued or
unaccrued, known or unknown, whenever arising, and including those arising
6
under any law, rule, regulation, Action, in each case, whether or not
recorded or reflected or required to be recorded or reflected on the books
and records or financial statements of any Person; provided, however, that
Liabilities shall not include any liabilities for Taxes which shall be
covered by the Tax Separation Agreement.
"Licenses" shall mean any license, ordinance, authorization, permit,
certificate, easement, variance, exemption, consent, order, franchise or
approval from any Governmental Authority, domestic or foreign.
"Litigation Matter" shall mean an actual, threatened or future
Action that has been or may be asserted against, or otherwise adversely
affect, Heinz and/or Spinco (or members of either Group).
"Merger" shall have the meaning specified in the Recitals hereto.
"Merger Agreement" shall have the meaning specified in the Recitals
hereto.
"Merger Sub" shall have the meaning specified in the Recitals
hereto.
"Net Proceeds" shall have the meaning specified in Section 5.06(c).
"Northside Complex" shall mean any and all of the real property
located at 0000 Xxxxxxxx Xxxxxx, Xxxxxxxxxx, Xxxxxxxxxxxx, and all of the
Facilities situated thereon.
"Northside Complex Heinz Signage" shall mean the electronic Heinz
ketchup bottle mounted above one of the Facilities on the Northside
Complex.
"Northside Lease and Facility Sharing Agreement" shall mean the
Northside Lease and Facility Sharing Agreement to be entered into prior to
the Distribution between Heinz and Spinco, in substantially the form of
Exhibit F hereto, with such additions, deletions or other modifications
thereto as are mutually agreed upon in writing by Heinz and Spinco,
subject to receipt by Heinz and Spinco of a Del Monte Consent.
"Notice of Claim" shall have the meaning specified in Section
5.05(a).
"Order" shall have the meaning specified in the Merger Agreement.
"Owned Real Property" shall have the meaning specified in Section
2.01(a)(i).
"Parties" shall have the meaning specified in the Preamble hereto.
"Person" shall have the meaning specified in the Merger Agreement.
"Release" shall have the meaning provided in 42 U.S.C. Section
9601(22).
"Representative" shall mean with respect to any Person, any of such
Person's directors, officers, employees, agents, consultants, advisors,
accountants, attorneys and representatives.
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"Restructuring Liabilities" shall mean Liabilities arising out of or
relating to actions taken by Heinz in restructuring Heinz Entities in
connection with the Contribution and Distribution on or prior to the
Distribution Date, including transfers of assets and liabilities in
connection therewith.
"Retained Business" shall mean the businesses of the Heinz Entities
other than the Spinco Business.
"Right of Use Agreement" shall mean the Right of Use Agreement to be
entered into prior to the Distribution between Heinz and Spinco, in
substantially the form of Exhibit K attached hereto, with such additions,
deletions and other modifications thereto as are mutually agreed upon in
writing by Heinz and Spinco, subject to receipt by Heinz and Spinco of
a Del Monte Consent.
"SEC" shall have the meaning specified in the Merger Agreement.
"Second Commitment Letter" shall have the meaning specified in the
Merger Agreement.
"Securities Act" shall have the meaning specified in the Merger
Agreement.
"Senior Secured Notes" shall have the meaning specified in Section
2.09.
"Shared Heinz IP" shall mean the Intellectual Property (other than
Trademarks, Data Communications Infrastructure or Intellectual
Property subject to any Common Contract) of any Heinz Entity
that is used in the Spinco Business on or before the
Distribution Date but is not included in the Spinco IP.
"Shared Heinz IP License Agreement" shall mean the Shared Heinz IP
License Agreement to be entered into prior to the Distribution by Heinz
and Spinco, in substantially the form of Exhibit G hereto, with such
additions, deletions and other modifications thereto as are mutually
agreed upon in writing by Heinz and Spinco, subject to receipt by
Heinz and Spinco of a Del Monte Consent.
"Shared Spinco IP" shall mean the Spinco IP (other than Trademarks)
that also relates to or is used in the Retained Business.
"Shared Spinco IP License Agreement" shall mean the Shared Spinco IP
License Agreement to be entered into prior to the Distribution by Heinz
and Spinco, in substantially the form of Exhibit H hereto, with such
additions, deletions and other modifications thereto as are mutually
agreed upon in writing by Heinz and Spinco, subject to receipt by
Heinz and Spinco of a Del Monte Consent.
"Spinco" shall have the meaning specified in the Preamble hereto.
"Spinco Assets" shall have the meaning specified in Section 2.01(a).
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"Spinco Benefit Plans" shall have the meaning specified in the
Merger Agreement.
"Spinco Business" shall have the meaning specified in the Merger
Agreement.
"Spinco Common Stock" shall have the meaning specified in the
Recitals hereto.
"Spinco Disclosure Letter" shall have the meaning specified in the
Merger Agreement.
"Spinco Employee" shall have the meaning specified in the Merger
Agreement.
"Spinco Group" shall mean Spinco and the Spinco Subsidiaries
immediately after the Distribution Date.
"Spinco Indemnitees" shall mean Spinco, each Affiliate of Spinco
immediately after the Distribution Date, each of their respective present
and former Representatives, each of the heirs, executors, successors and
assigns of any of the foregoing and each Person, if any, who controls
Spinco within the meaning of Section 15 of the Securities Act or Section
20 of the Exchange Act.
"Spinco IP" shall have the meaning specified in Section 2.01(a)(v).
"Spinco Liabilities" shall have the meaning specified in Section
2.01(c).
"Spinco Registration Statement" shall mean a Registration Statement
on Form 10 (or, if such form is not appropriate, the appropriate form
pursuant to the Securities Act or the Exchange Act) to be filed by Spinco
with the SEC to effect the registration of the Spinco Common Stock
pursuant to the Exchange Act in connection with the Distribution (and, if
applicable, pursuant to the Securities Act), to the extent required by the
SEC.
"Spinco Subsidiaries" shall mean all Subsidiaries of Spinco
immediately after the Distribution Date.
"Subsidiary" or "Subsidiaries" shall have the meaning specified in
the Merger Agreement.
"Surviving Corporation" shall have the meaning specified in the
Merger Agreement.
"Tax" shall have the meaning specified in the Merger Agreement.
"Tax Separation Agreement" shall mean the Tax Separation Agreement
to be entered into prior to the Distribution by Heinz, Spinco and Del
Monte, in substantially the form of Exhibit A hereto, with such additions,
deletions and other modifications thereto as are mutually agreed upon in
writing by Heinz and Spinco, subject to receipt by Heinz and Spinco of
a Del Monte Consent.
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"Terminal Island Property" shall mean the real property (and the
Facilities located thereon and the Canner's Steam facility located
adjacent thereto) specified in (i) the Lease Permit No. 702, dated
September 26, 1992, as amended, by and between the City of Los Angeles and
Heinz Pet Products and (ii) the Revocable Permit No. 96-44, dated March
13, 1997, between Star-Xxxx Foods, Inc. doing business as Heinz Pet
Products and City of Los Angeles Harbor Department.
"Terminal Island Reserve" shall mean the reserve, existing as of the
Distribution Date, relating to the restructuring reserve for the exit from
the Terminal Island Property.
"Third Party Claim" shall have the meaning specified in Section
5.05(b).
"Trade Accounts Payable" shall have the meaning specified in the
Merger Agreement.
"Xxxxx Warehouse and Transportation Agreement" shall mean the Xxxxx
Warehouse and Transportation Agreement to be entered into prior to the
Distribution between Heinz and Spinco, in substantially the form of
Exhibit I hereto, with such additions, deletions or other modifications
thereto as are mutually agreed upon in writing by Heinz and Spinco,
subject to receipt by Heinz and Spinco of a Del Monte Consent.
"Trade Accounts Receivable" shall have the meaning specified in the
Merger Agreement.
"Trademark and Cooperation Agreement" shall mean the Trademark and
Cooperation Agreement to be entered into prior to the Distribution between
Heinz and Spinco, in substantially the form of Exhibit J hereto, with such
additions, deletions or other modifications thereto as are mutually agreed
upon in writing by Heinz and Spinco, subject to receipt by Heinz and
Spinco of a Del Monte Consent.
"Trademark License Agreement" shall mean the Trademark License
Agreement to be entered into prior to the Distribution between Heinz and
Spinco, in substantially the form of Exhibit B attached hereto, with such
additions, deletions and other modifications thereto as are mutually
agreed upon in writing by Heinz and Spinco, subject to receipt by
Heinz and Spinco of a Del Monte Consent.
"Trademarks" shall mean registered, unregistered or pending
trademarks, service marks, trade names, service names, brand names,
corporate names, domain names, logos or business symbols, trade dress, or
other source indicators and all goodwill associated therewith.
"Transaction Agreements" shall mean this Agreement, the Merger
Agreement, the Employee Benefits Agreement, the Trademark License
Agreement, the Transition Services Agreement, the Tax Separation
Agreement, the Co-Pack Agreements, the Joint Procurement Memorandum of
Understanding, the Shared Heinz IP License Agreement, the Shared Spinco IP
License Agreement, the Xxxxx Warehouse and Transportation Agreement, the
Trademark and Cooperation Agreement, the U.S. Food Services
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Agreement, the Canadian Operating Services Agreement, the Northside Lease
and Facility Sharing Agreement, the Right of Use Agreement and the other
agreements, if any, entered into or to be entered into in connection with
the Contribution and Distribution, each of such other agreements as
mutually agreed upon by Heinz, Spinco and Del Monte.
"Transition Services Agreement" shall mean the Transition Services
Agreement to be entered into prior to the Distribution between Heinz and
Spinco, in substantially the form of Exhibit C hereto, with such
additions, deletions and other modifications thereto as are mutually
agreed upon in writing by Heinz and Spinco, subject to receipt by Heinz
and Spinco of a Del Monte Consent.
"U.S. Food Service Agreement" shall mean the U.S. Food Service
Agreement to be entered into prior to the Distribution between Heinz and
Spinco, in accordance with the terms of the U.S. Food Service Term Sheets
set forth in Schedule 1.01(b) hereto, with such additions, deletions and
other modifications thereto as are mutually agreed upon in writing by
Heinz and Spinco, subject to receipt by Heinz and Spinco of a Del Monte
Consent.
Section 1.02 References to Time. All references in this Agreement to times
of the day shall be to New York time.
Section 1.03 References to Schedules. All references in this Agreement to
Schedules shall mean the Schedules attached hereto; provided such Schedules
shall be deemed to be automatically updated to reflect any changes to the
information contained therein arising out of or resulting from any transactions
or events occurring prior to the Closing Date in accordance with Section 6.1 of
the Merger Agreement.
ARTICLE II
THE CONTRIBUTION
Section 2.01 Spinco Assets and Excluded Assets; Spinco Liabilities and
Excluded Liabilities.
(a) "Spinco Assets" shall mean any and all of the assets, properties,
goodwill and rights of the Heinz Entities, wherever located, relating primarily
to or used primarily in the Spinco Business as of the Distribution Date (other
than (i) as qualified as set forth below with respect to the specified
categories of assets and (ii) the Excluded Assets), including the following
(other than the Excluded Assets):
(i) Owned Real Property. All real property owned in fee by any Heinz
Entity used or held for use primarily in the Spinco Business (the "Owned Real
Property"), including all plants, facilities, buildings, structures and other
improvements situated thereon (individually referred to as a "Facility" and
collectively, the "Facilities"), including the Owned Real Property and
Facilities set forth on Schedule 2.01(a)(i) hereto, and all easements,
rights-of-way and appurtenances pertaining to or accruing to the benefit of such
Owned Real Property and Facilities, in each case subject to the exceptions
described on Schedule 2.01(a)(i).
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(ii) Leased Real Property. All leasehold interests in real property
of any Heinz Entity used or held for use primarily in the Spinco Business (the
"Leased Real Property"), including the Leased Real Property set forth on
Schedule 2.01(a)(ii) hereto, and all appurtenances relating to such Leased Real
Property.
(iii) Machinery and Equipment. All machinery, equipment, fixtures,
motor vehicles, furniture, dies, molds, tools and other items of tangible
personal property of any Heinz Entity used or held for use primarily in the
Spinco Business (taking like items into consideration on an aggregate basis),
including the machinery and equipment set forth on Schedule 2.01(a)(iii).
(iv) Inventories. All inventories of raw materials, packaging
supplies and materials, works-in-process, spare parts, maintenance supplies and
finished products (including unlabeled finished products) of any Heinz Entity to
the extent used or held for use in or produced by the Spinco Business for use in
or sale by the Spinco Business, except that all raw materials and packaging
supplies and materials which will be allocated for use in the production of
finished products under the Co-Pack Agreements shall be owned by the
manufacturer under each such Co-Pack Agreement.
(v) Intellectual Property. Subject to Section 2.02(e), all Shared
Spinco IP and the Intellectual Property of any Heinz Entity relating primarily
to or used primarily in the Spinco Business (but excluding any elements of the
Data Communications Infrastructure that may fall within the definition of
"Intellectual Property") (the "Spinco IP"), subject to any grant of rights to
any third party with respect thereto granted prior to the Distribution Date,
including the Intellectual Property set forth on Schedule 2.01(a)(v), subject to
the (i) Shared Spinco IP License Agreement and (ii) Trademark and Cooperation
Agreement.
(vi) Books and Records. To the extent not included in Spinco IP, all
books, records and other documents of any Heinz Entity used or held for use
primarily in the Spinco Business, including customer and supplier lists and
files; distribution lists; mailing lists; sales materials; operating, production
and other manuals; computer program data and information; manufacturing and
quality control records and procedures; research and development files;
advertising and promotional materials and similar information, plans, files,
documents and records, but excluding any portion of such items which incorporate
or reflect information relating to the Retained Business. Notwithstanding the
foregoing, "Books and Records" shall not include information that, if delivered
to Spinco, would violate any privacy laws, regulations, rules, opinions, other
statements or positions of a Governmental Authority or the requirements of any
self-regulatory body (including any self-regulatory privacy body).
(vii) Contracts. Subject to Section 2.02(e), to the extent
transferable, all Contracts of any Heinz Entity relating primarily to or used
primarily in the Spinco Business, including the Contracts set forth on Schedule
2.01(a)(vii).
(viii) Licenses. Subject to Section 2.02(e), to the extent
transferable, all Licenses of any Heinz Entity relating primarily to or used
primarily in the Spinco Business, including the Licenses set forth on Schedule
2.01(a)(viii).
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(ix) Prepaid Expenses. All prepaid expenses, credits or similar
advance payments, including slotting payments and lease deposits, made by any
Heinz Entity to the extent related to the Spinco Business.
(x) Benefit Plan Assets. The assets to be transferred to Spinco
pursuant to the Employee Benefits Agreement (including the cash specified
therein).
(xi) Trade Accounts Receivable. To the extent transferable in
accordance with Section 7.19 of the Merger Agreement, the Trade Accounts
Receivable and to the extent the Trade Accounts Receivable are not transferable
in accordance with Section 7.19 of the Merger Agreement, the payment, if any, to
be made pursuant to Section 7.19 of the Merger Agreement in lieu of such
transfer.
(xii) Claims. To the extent transferable, claims (including pending
claims but excluding claims under insurance policies of any Heinz Entity,
which are addressed in clause (xix) below), causes of action, choses in action,
rights under express or implied warranties, guarantees and indemnities, rights
of recovery and rights of setoff of any kind to the extent related to the Spinco
Business.
(xiii) Subsidiaries/Other Interests. The shares of capital stock of
the Subsidiaries and interests in the Persons set forth on Schedule
2.01(a)(xiii).
(xiv) Other Assets. All other assets, properties, goodwill and
rights included in management's estimated statement of assets and liabilities of
the Spinco Business as of May 1, 2002 (as set forth in Section 4.5(b) of the
Spinco Disclosure Letter) to the extent such assets, properties, goodwill and
rights are still owned or leased by any Heinz Entity on the Distribution Date.
(xv) Data Communication Infrastructure. The data communication
infrastructure specified in Schedule 2.01(a)(xv) (the "Data Communications
Infrastructure").
(xvi) Cash in Certain Bank Accounts. All bank accounts solely
related to the Spinco Business; provided, however, that the Debt Security Amount
shall be increased by a mutually agreed estimate of the amount of cash that will
be contained in such accounts as of the close of business on the Distribution
Date (the "Bank Account Amount").
(xvii) Letters of Credit. All letters of credit, performance and
surety bonds and related deposits to the extent related to the Spinco Business.
(xviii) Universal Product Codes. (a) All rights to universal product
codes which are exclusive (including the manufacturer code) to a Heinz Entity
listed on Schedule 2.01(a)(xiii) and (b) to the extent transferred pursuant to
the Right of Use Agreement, the rights to universal product codes used on all
other products of the Spinco Business not otherwise included in clause (a).
(xix) Insurance Policies. To the extent set forth in Article VI and
to the extent a claim relates to the Spinco Business, the rights under Insurance
Policies, including the right to make claims thereunder.
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(xx) Terminal Island Reserve. The Terminal Island Reserve.
(b) "Excluded Assets" shall mean any of the following assets,
properties, goodwill or rights:
(i) Cash and Cash Equivalents. Except as set forth in Section
2.01(a) above, cash and cash equivalents, including bank
deposits, investments in "money market" funds, commercial
paper funds, certificates of deposit, Treasury Bills and
accrued interest on any of the foregoing.
(ii) Information Systems and Technology. All information systems
and technology of any Heinz Entity except as set forth in
Section 2.01(a)(xv).
(iii) Rights under the Transaction Agreements. All rights of the
Heinz Group under the Transaction Agreements.
(iv) Transferred or Disposed Assets. Any assets that are
transferred or otherwise disposed of by any Heinz Entity from
the date hereof until the Closing not in violation of Section
6.1 of the Merger Agreement.
(v) Heinz Intellectual Property. All (i) Shared Heinz IP, subject
to the Shared Heinz IP License Agreement, and (ii) Trademarks
containing, including or used in connection with the name or
brands of any member of the Heinz Group, subject to the
Trademark License Agreement;
(vi) Trade Accounts Receivable. To the extent not transferable in
accordance with Section 7.19 of the Merger Agreement, the
Trade Accounts Receivable.
(vii) Certain Star-Xxxx Subsidiaries. The Subsidiaries of Star-Xxxx
Foods and interests in the Persons (collectively, "Excluded
Star-Xxxx Subsidiaries") listed in Schedule 2.01(b)(vii).
(viii)Real Property. The real property and Facilities listed on
Schedule 2.01(b)(viii).
(ix) Heinz Employees' Personal Computers. Any Heinz employee's
personal computer, if any, and printers, if any.
(x) Heinz Intercompany Contracts. Except as set forth in Schedule
2.02(f), any and all Contracts among Heinz Entities, including
loans and any obligations arising thereunder.
(xi) Other Excluded Assets. Such other assets as are set forth on
Schedule 2.01(b)(xi).
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(xii) Non-Spinco Assets. For the avoidance of doubt, all assets of
the Heinz Entities as of the Distribution Date that do not
constitute Spinco Assets.
(c) "Spinco Liabilities" shall mean all Liabilities arising out of or
related to the Spinco Business or the Spinco Assets other than the Excluded
Liabilities, whether incurred or occurring prior to, on or after the
Distribution Date including, without limitation, the following:
(i) Product Liabilities and Other Actions. All Liabilities in
connection with Actions arising out of or related to the
Spinco Business or the Spinco Assets, including any claim for
personal injury, property damage or economic loss.
(ii) Environmental Claims. All Environmental Claims arising out of
or relating to the Spinco Business.
(iii) Spinco Employees and Benefit Plans. All Liabilities (except
those set forth in Section 2.01(d)(i)) arising out of or
relating to the Spinco Employees and, pursuant to the terms of
the Employee Benefits Agreement, the Spinco Benefit Plans.
(iv) Contracts and Licenses. All Liabilities under Contracts and
Licenses set forth in Sections 2.01 (a)(vii) and (viii).
(v) Trade Accounts Payable. To the extent transferable in
accordance with Section 7.19 of the Merger Agreement, the
Trade Accounts Payable.
(vi) Deductions and Returns. All Liabilities for customer
deductions and returns, with commercially reasonable
supporting documentation, arising out of or relating to
products of the Spinco Business, whether arising out of or
relating to products sold prior to, on or following the
Distribution Date.
(vii) Expenses. The obligation to pay the expenses as set forth in
Section 9.02 hereof or as set forth in the other Transaction
Agreements.
(viii)Redemption of Coupons. All Liabilities for administration and
redemption of coupons arising out of or relating to the Spinco
Business.
(d) "Excluded Liabilities" shall mean:
(i) All Liabilities relating to the employment relationships with
former employees of Heinz whose employment responsibilities at
any time related to the Spinco Business and who had retired as
of the Closing Date.
(ii) To the extent not transferable in accordance with Section 7.19
of the Merger Agreement, the Trade Accounts Payable.
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(iii) Liabilities to the extent arising out of or relating to the
Excluded Assets.
(iv) All Restructuring Liabilities.
(e) Except as otherwise specifically set forth herein, the rights and
obligations of the Parties with respect to Taxes shall be governed by the Tax
Separation Agreement and, therefore, Taxes shall not be treated as Assets or
Liabilities under this Section 2.01.
Section 2.02 Business Separation. (a) Transfer of Spinco Assets. On or
prior to the Distribution Date and subject to the satisfaction or waiver of the
conditions set forth in Section 7.01, Heinz shall assign, transfer, convey and
deliver to Spinco, and agrees to cause the applicable Heinz Subsidiaries to
assign, transfer, convey and deliver to Spinco, and Spinco shall accept from
Heinz and the applicable Heinz Subsidiaries, all of Heinz's and the applicable
Heinz Subsidiaries' respective right, title and interest in all Spinco Assets,
other than the Delayed Transfer Assets.
(b) Assumption of Spinco Liabilities. On or prior to the Distribution Date
and subject to the satisfaction or waiver of the conditions set forth in Section
7.01, Spinco shall assume, pay and agree faithfully to perform and discharge
when due all the Spinco Liabilities (other than the Delayed Transfer
Liabilities) in accordance with their respective terms. Spinco shall be
responsible for all Spinco Liabilities, regardless of when or where such
Liabilities arose or arise, or whether the facts on which they are based
occurred prior to, on or subsequent to the Distribution Date, regardless of
where or against whom such Liabilities are asserted or determined or whether
asserted or determined prior to the Distribution Date, and regardless of whether
arising from or alleged to arise from the negligence, recklessness or violation
of law by any member of the Spinco Group or the Heinz Group or any of their
respective Representatives or Affiliates.
(c) Delayed Transfer Assets and Liabilities. Anything in this Agreement to
the contrary notwithstanding, Heinz is not obligated to assign, transfer, convey
or deliver to Spinco and Spinco is not obligated to assume any of the rights and
obligations under any Delayed Transfer Asset or Delayed Transfer Liability until
such time as all Legal Impediments are removed and/or all Consents or
Governmental Approvals necessary for the legal transfer and/or assumption
thereof are obtained. Each of the Parties hereto agrees that the Delayed
Transfer Assets shall be assigned, transferred, conveyed and delivered, and any
Delayed Transfer Liabilities shall be assumed in accordance with the provisions
of Sections 2.03 and 2.04(b). On the Closing Date, Heinz shall use its
reasonable best efforts to deliver to Spinco (for informational purposes only) a
schedule setting forth, all material Delayed Transfer Assets and Delayed
Transfer Liabilities existing as of the Closing Date (the "Delayed Transfer
Assets and Liabilities Schedule").
(d) Subsequent Transfers. Subject to Section 2.02(c), in the event that at
any time or from time to time after the Distribution Date any Party hereto (or
any member of such Party's respective Group) becomes aware that it possesses any
Asset or Liability that is allocated to the other Party pursuant to this
Agreement or any other Transaction Agreement, such Party shall promptly
transfer, or cause to be transferred, such Asset or Liability to the Party so
entitled
16
thereto. Prior to any such transfer, the Party possessing such Asset or
Liability shall hold such Asset or Liability in trust for any such other Party.
(e) Separation of Contractual Arrangements. On or prior to the
Distribution Date and subject to the satisfaction or waiver of the conditions
set forth in Section 7.01, Heinz and Spinco shall use their reasonable best
efforts to amend all material Contracts between or among (i) members of the
Heinz Group and the Spinco Group, on the one hand, and (ii) any other Person, on
the other hand (other than the contractual arrangements relating to the
Distribution and the Merger and the transactions contemplated thereby), that
relate to both the Spinco Business and the Retained Business (the "Common
Contracts"), including the Common Contracts set forth on Schedule 2.02(e)
hereto, so that, after the Distribution Date, such Common Contracts shall be
equitably apportioned between the respective Businesses, including, if
commercially practicable, on substantially the same economic terms as such
arrangements exist as of the Distribution Date.
If, in the case of a Common Contract relating primarily to or used
primarily in connection with the Retained Business, such amendments cannot be
obtained, or if an attempted amendment thereof would be ineffective or would
adversely affect in a material respect the rights of Heinz or Spinco thereunder,
Heinz and Spinco shall use their reasonable best efforts to negotiate a mutually
acceptable arrangement under which (i) Spinco shall obtain the benefits and
assume the obligations under such Common Contract to the extent relating to the
Spinco Business, including by entering into sub-contracting, sub-licensing or
sub-leasing arrangements for the benefit of Spinco, or (ii) Heinz shall enforce
for the benefit of Spinco, with Spinco assuming Heinz's obligations, any and all
rights of Heinz against a third party thereto to the extent relating to the
Spinco Business.
If, in the case of a Common Contract relating primarily to or used
primarily in connection with the Spinco Business, such amendments cannot be
obtained, or if an attempted amendment thereof would be ineffective or would
adversely affect in a material respect the rights of Heinz or Spinco thereunder,
Heinz and Spinco shall use their reasonable best efforts to negotiate a mutually
acceptable arrangement under which (i) Heinz shall obtain the benefits and
assume the obligations under such Common Contract to the extent relating to the
Retained Business, including by entering into sub-contracting, sub-licensing or
sub-leasing arrangements for the benefit of Heinz, or (ii) Spinco shall enforce
for the benefit of Heinz, with Heinz assuming Spinco's obligations, any and all
rights of Spinco against a third party thereto to the extent relating to the
Retained Business.
(f) Termination of Intercompany Agreements. (i) On or prior to the
Distribution Date, each member of the Heinz Group, on the one hand, and each
member of the Spinco Group, on the other hand, shall terminate any and all
agreements, arrangements, commitments or understandings, whether or not in
writing, between or among Heinz and/or any member of the Heinz Group, on the one
hand, and Spinco and/or any member of the Spinco Group, on the other hand,
effective as of the Distribution Date. No such terminated agreement,
arrangement, commitment or understanding (including any provision thereof that
purports to survive termination) shall be of any further force or effect after
the Distribution Date and all parties shall be released from all obligations
thereunder. Each Party shall, at the reasonable request of the other Party,
take, or cause to be taken, such other actions as may be necessary to effect the
foregoing.
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(ii) On or prior to the Distribution Date, all loans by and between
any member of the Heinz Group, on the one hand, and any member of the Spinco
Group, on the other hand, shall be terminated, all related notes shall be
cancelled and all outstanding indebtedness thereunder shall be released and
forgiven.
(iii) The provisions of Section 2.02(f)(i) shall not apply to this
Agreement and the other Transaction Agreements or any of the agreements or
arrangements set forth on Schedule 2.02(f).
Section 2.03 Documents Relating to Transfers of Spinco Assets and
Assumption of Spinco Liabilities. In furtherance of the assignment, transfer and
conveyance of Spinco Assets and the assumption of Spinco Liabilities pursuant to
Section 2.02, on or prior to the Distribution Date and, with respect to Delayed
Transfer Assets and Delayed Transfer Liabilities, at such time after the
Distribution Date as such Delayed Transfer Asset or Delayed Transfer Liability
can be transferred, (a) Heinz shall execute and deliver, and shall cause its
Subsidiaries to execute and deliver, such bills of sale, deeds, lease
assignments and assumptions, leases, sub-subleases, stock powers, certificates
of title, assignments of contracts and other instruments of transfer, conveyance
and assignment as and to the extent necessary to evidence the transfer,
conveyance and assignment of the Heinz Entities' right, title and interest in
and to the Spinco Assets to Spinco and (b) Spinco shall execute and deliver to
the relevant Heinz Entity such assignments of contracts and other instruments of
assumption as and to the extent necessary to evidence the valid and effective
assumption by Spinco of the Spinco Liabilities; provided, that any instruments
executed and delivered pursuant to this Section 2.03 shall be in form reasonably
satisfactory to Heinz, Spinco and Del Monte.
Section 2.04 Governmental Approvals and Consents. (a) If the transfer,
assignment or assumption of any Delayed Transfer Asset or any Delayed Transfer
Liability intended to be transferred, assigned or assumed hereunder is not
consummated prior to or at the Distribution Date, whether as a result of the
provisions of Section 2.02(c) or for any other reason, then the member of the
Heinz Group retaining such Delayed Transfer Asset or such Delayed Transfer
Liability shall thereafter hold such Delayed Transfer Asset or such Delayed
Transfer Liability for the use and benefit, insofar as reasonably practicable,
of Spinco (at the expense of Spinco). In addition, the member of the Heinz Group
retaining such Delayed Transfer Asset or such Delayed Transfer Liability shall
take such other actions in order to place Spinco, insofar as reasonably
practicable, in the same position as if such Delayed Transfer Asset or such
Delayed Transfer Liability had been transferred or assumed as contemplated
hereby and so that all the benefits and burdens relating to such Delayed
Transfer Asset or such Delayed Transfer Liability, including possession, use,
risk of loss, potential for gain, and dominion, control and command over such
Asset, are to inure from, and after the Distribution Date to, Spinco. To the
extent permitted by law and to the extent otherwise permissible in light of any
Legal Impediment or required Consent and/or Governmental Approval, Spinco shall
be entitled to, and shall be responsible for, the management and the benefits
and burdens of any Delayed Transfer Asset or any Delayed Transfer Liability not
yet transferred to or assumed by it as a result of Section 2.02(c) and the
Parties agree to use reasonable best efforts to cooperate and coordinate with
respect thereto.
(b) If and when the Legal Impediments and the Consents and/or Governmental
Approvals, the failure to remove or the absence of which caused the deferral of
the transfer or
18
assumption of any Spinco Asset or Spinco Liability pursuant to Section 2.02(c),
are removed or obtained, as the case may be, the transfer and assumption of the
applicable Spinco Asset or Spinco Liability shall be promptly effected in
accordance with the terms of this Agreement and/or the other applicable
Transaction Agreement, without the payment of additional consideration.
(c) The member of the Heinz Group retaining a Spinco Asset or Spinco
Liability due to the deferral of the transfer or assumption of such Spinco Asset
or Spinco Liability pursuant to Section 2.02(c) shall not be obligated, in
connection with the foregoing, to expend any money unless the necessary funds
are advanced by Spinco, other than reasonable out-of-pocket expenses, attorneys'
fees and recording or similar fees, all of which shall be promptly reimbursed by
Spinco. Any member of the Spinco Group holding a Heinz Asset or Heinz Liability
improperly transferred to or assumed by the Spinco Group shall not be obligated,
in connection with the foregoing, to expend any money unless the necessary funds
are advanced by Heinz, other than reasonable out-of-pocket expenses, attorneys'
fees and recording or similar fees, all of which shall be promptly reimbursed by
Heinz.
(d) Notwithstanding anything to the contrary herein, Heinz and Spinco
agree, and agree to cause their respective Subsidiaries, to use their reasonable
best efforts to obtain, before the Distribution Date, any Consent or
Governmental Approval required in connection with the Contribution and the
Distribution.
Section 2.05 Novation of Liabilities. (a) (i) Spinco, at the written
request of Heinz, shall use its reasonable best efforts to (x) obtain, or to
cause to be obtained, any release, consent, substitution, approval or amendment
required to novate all members of the Heinz Group from and assign all
obligations under Contracts, Licenses and other obligations or Liabilities of
any nature whatsoever that constitute Spinco Liabilities, or to obtain in
writing the unconditional release of all members of the Heinz Group to such
obligations, so that, in any such case, the members of the Spinco Group shall be
solely responsible for such Spinco Liabilities and (y) terminate, or to cause
Spinco Assets to be substituted in all respects for any assets of the Retained
Business ("Heinz Assets") in respect of, any liens or encumbrances on Heinz
Assets which are securing any Spinco Liabilities; provided, however, that no
member of the Spinco Group shall be obligated, in connection with the foregoing,
to expend any money, unless the necessary funds are advanced by Heinz, other
than reasonable out-of-pocket expenses, attorneys' fees and recording or similar
fees, all of which shall be promptly reimbursed by Heinz.
(ii) If Spinco is unable to obtain, or to cause to be obtained, any
such required release, consent, substitution, approval or amendment pursuant to
Section 2.05(a)(i), the applicable member of the Heinz Group shall continue to
be bound by such Contracts, Licenses and other obligations and, unless not
permitted by law or the terms thereof, Spinco shall, as agent or subcontractor
for such member of the Heinz Group, pay, perform and discharge fully all the
obligations or other Liabilities of such member of the Heinz Group thereunder
from and after the Distribution Date. Spinco (i) shall indemnify and hold
harmless each Heinz Indemnitee and hold it harmless against any Liabilities
arising in connection therewith and (ii) without the prior written consent of
Heinz, from and after the Distribution Date, shall not, and shall not permit any
member of the Spinco Group to, renew or extend the term of, increase its
obligations under or transfer any Contract, License or the obligation for which
a member of the Heinz Group is or
19
may be liable, which any Heinz Asset is or may be encumbered, unless all
obligations of the Heinz Group and all liens and encumbrances on any Heinz Asset
with respect thereto are thereupon released and terminated by documentation
reasonably satisfactory in form and substance to Heinz.
(b) (i) Heinz, at the written request of Spinco, shall use its reasonable
best efforts to (x) obtain, or to cause to be obtained, any release, consent,
substitution, approval or amendment required to novate all members of the Spinco
Group from and assign all obligations under Contracts, Licenses and other
obligations or Liabilities of any nature whatsoever that constitute Liabilities
of the Heinz Group, or to obtain in writing the unconditional release of all
members of the Spinco Group to such obligations, so that, in any such case, the
members of the Heinz Group shall be solely responsible for such Heinz
Liabilities and (y) terminate, or to cause Heinz Assets to be substituted in all
respects for any Spinco Assets in respect of, any liens or encumbrances on
Spinco Assets which are securing any Heinz Liabilities; provided, however, that
no member of the Heinz Group shall be obligated, in connection with the
foregoing, to expend any money, in connection with the foregoing, unless the
necessary funds are advanced by Spinco, other than reasonable out-of-pocket
expenses, attorneys' fees and recording or similar fees, all of which shall be
promptly reimbursed by Spinco.
(ii) If Heinz is unable to obtain, or to cause to be obtained, any
such required release, consent, approval, substitution or amendment pursuant to
Section 2.05(b)(i), the applicable member of the Spinco Group shall continue to
be bound by such Contracts, Licenses and other obligations and, unless not
permitted by law or the terms thereof, Heinz shall, as agent or subcontractor
for such member of the Spinco Group, pay, perform and discharge fully all the
obligations or other Liabilities of such member of the Spinco Group thereunder
from and after the Distribution Date. Heinz (x) shall indemnify and hold
harmless each Spinco Indemnitee and hold each of them harmless against any
Liabilities arising in connection therewith and (y) without the prior written
consent of Spinco, from and after the Distribution Date, shall not, and shall
not permit any member of the Heinz Group to, renew or extend the term of,
increase its obligations under or transfer any Contract, License or the
obligation for which a member of the Spinco Group is or may be liable or for
which any Spinco Asset is or may be encumbered unless all obligations of the
Spinco Group and all liens and encumbrances on any Spinco Asset with respect
thereto are thereupon released and terminated by documentation reasonably
satisfactory in form and substance to Spinco.
Section 2.06 Certificate of Incorporation; By-laws. The Certificate of
Incorporation and Bylaws of Spinco immediately prior to the Effective Time shall
be in the forms attached as Exhibits A and D, respectively, to the Merger
Agreement.
Section 2.07 Issuance of Stock. At or prior to the Distribution Date and
subject to the satisfaction or waiver of the conditions set forth in Section
7.01, the Parties shall take all steps necessary so that on the Distribution
Date (i) the number of authorized shares of Spinco Common Stock shall equal or
exceed the sum of (x) the number of shares of Heinz Common Stock outstanding as
of the Heinz Record Date and (y) the number of shares of Spinco Common Stock
sufficient to cover the issuance of shares of Spinco Common Stock with respect
to any options, warrants or other securities which are convertible, exchangeable
or exercisable for Spinco Common Stock as of the Heinz Record Date and (ii) the
number of shares of Spinco
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Common Stock outstanding and held by Heinz shall equal the number of shares of
Heinz Common Stock outstanding as of the Heinz Record Date (other than treasury
shares).
Section 2.08 Other Transaction Agreements. At or prior to the Distribution
Date and subject to the satisfaction or waiver of the conditions set forth in
Section 7.01, each of Heinz and Spinco shall execute and deliver the other
Transaction Agreements that were not previously executed.
Section 2.09 Financing. Prior to the Distribution, Spinco shall (i) incur
bank debt (the "Bank Debt"), on substantially the terms set forth in the First
Commitment Letter, with such additions, deletions and other modifications to the
terms and provisions thereof to which Heinz has consented (such consent not to
be unreasonably withheld), and (ii) issue senior subordinated notes or senior
unsecured notes in an aggregate principal amount equal to the Debt Security
Amount (the "High Yield Debt Security") to Heinz on substantially the terms set
forth in the Engagement Letter or if not issued on such basis, then with such
additions, deletions and other modifications to the terms and provisions thereof
to which Heinz has consented (such consent not to be unreasonably withheld) or,
if the High Yield Debt Security is not issued, issue senior secured notes in an
aggregate principal amount equal to the Debt Security Amount (the "Senior
Secured Notes") to Heinz on substantially the terms set forth in the Second
Commitment Letter, with such additions, deletions and other modifications to the
terms and provisions thereof to which Heinz has consented (such consent not to
be unreasonably withheld). Prior to the Distribution and as part of the
Contribution, Spinco shall (i) issue the High Yield Debt Security or the Senior
Secured Notes and (ii) transfer or otherwise distribute an amount in cash equal
to the Bank Debt Amount to Heinz in exchange for the contribution of the Spinco
Assets and the assumption of the Spinco Liabilities, and Heinz shall transfer
the High Yield Debt Security or the Senior Secured Notes, as the case may be,
and the cash in an amount equal to the Bank Debt Amount to its creditors.
Section 2.10 Registration and Listing Prior to the Distribution Date. (a)
If required by applicable law, the Parties shall use their reasonable best
efforts to prepare and file with the SEC the Spinco Registration Statement and
each Party shall use its reasonable best efforts to have the Spinco Registration
Statement declared effective by the SEC as promptly as practicable after such
filing and to keep the Spinco Registration Statement effective as long as
necessary to consummate the Distribution. The Parties shall use their reasonable
best efforts to prepare and file with the SEC any necessary amendment or
supplement to the Spinco Registration Statement.
(b) The Parties hereto shall take all such actions as may reasonably be
required or appropriate under federal or state securities or Blue Sky laws (and
any comparable laws under any foreign jurisdiction) in connection with the
transactions contemplated by the Merger Agreement.
(c) The Parties shall cooperate in preparing, filing with the SEC and
causing to become effective any registration statements or amendments thereto,
if any, which are necessary or appropriate to reflect the establishment of, or
amendments to, any employee benefit plans contemplated by the Employee Benefits
Agreement requiring registration under the Securities Act.
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ARTICLE III
THE DISTRIBUTION
Section 3.01 Heinz Record Date and Distribution Date. Prior to the
Distribution Date, the Board of Directors of Heinz, in accordance with
applicable law, shall establish the Heinz Record Date and the Distribution Date
and any appropriate procedures in connection with the Distribution.
Section 3.02 The Distribution Agent. Prior to the Distribution Date, Heinz
shall enter into an agreement with the Distribution Agent providing for, among
other things, the actions to be taken pursuant to Article II of the Merger
Agreement.
Section 3.03 Delivery of Share Certificates to the Distribution Agent. (a)
Subject to the satisfaction or waiver of the conditions set forth in Section
7.01, on or prior to the Distribution Date, Heinz shall deliver to the
Distribution Agent for the benefit of holders of record of Heinz Common Stock on
the Heinz Record Date, the Distribution Stock Certificate (which shall
constitute all of the shares of Spinco Common Stock outstanding as of the
Distribution Date), and shall cause the transfer agent for the shares of Heinz
Common Stock to instruct the Distribution Agent to hold in trust (pending
conversion of such shares of Spinco Common Stock into shares of Common Stock,
par value $0.01 per share, of Del Monte pursuant to the Merger Agreement) the
appropriate number of such shares of Spinco Common Stock (as set forth in
Section 3.03(b)) for each such holder of record. For the avoidance of doubt,
Heinz shall not be considered a holder of record of Heinz Common Stock as of the
Heinz Record Date with respect to any shares of Heinz Common Stock held in its
treasury.
(b) Subject to the satisfaction or waiver of the conditions set forth in
Section 7.01, each holder of record of Heinz Common Stock on the Heinz Record
Date shall be entitled to have the Distribution Agent receive, on such holder's
behalf, in the Distribution a number of shares of Spinco Common Stock equal to
the number of shares of Heinz Common Stock held by such holder on the Heinz
Record Date.
Section 3.04 The Distribution. Subject to the satisfaction or waiver of
the conditions set forth in Section 7.01, Spinco shall instruct the Distribution
Agent at or prior to the Effective Time to take the actions contemplated to be
taken by the Distribution Agent pursuant to Article II of the Merger Agreement.
Section 3.05 Timing of the Distribution. Heinz shall consummate the
Contribution and Distribution as promptly as practicable after satisfaction (or
waiver to the extent permissible) of all of the conditions to the Contribution
and the Distribution specified in Section 7.01 (other than conditions that by
their nature are to be satisfied at the time of the Contribution, Distribution
or the Merger and shall in fact be satisfied at such time). The Contribution
shall occur on the Distribution Date prior to the Distribution, which shall
occur at a time to be mutually agreed by the Parties on the Distribution Date.
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ARTICLE IV
ADDITIONAL COVENANTS
Section 4.01 Access to Information. Upon reasonable notice, each of Heinz
and Spinco, shall from and after the Distribution Date, afford to each other and
to the other Party's Representatives, reasonable access, during normal business
hours, in a manner that does not unreasonably interfere with one another's
respective business and operations, to its and its Subsidiaries' plants,
properties, Contracts and all other Information (and in the case of Information
to be provided by Heinz, only to the extent such Information has not been
delivered to Spinco pursuant to Section 2.02 hereof) and in each case relates to
the Spinco Business on or prior to the Distribution Date. For the purposes of
this Section 4.01, all communications, including requests for Information or
access, pursuant to this Section 4.01, shall only be made by and between a
Representative of each of Heinz, on the one hand, and of Spinco, on the other
hand, which Representative (a) shall initially be Xxxxx Ring for Heinz and Xxxxx
Xxxxxx or his designee for Spinco and (b) may be replaced with a substitute
Representative by either Party from time to time upon reasonable written notice
to the other Party. Notwithstanding the foregoing, neither Heinz or Spinco nor
their respective Subsidiaries shall be required to provide any Information to
the extent that any such Party or any of their respective Subsidiaries is
legally obligated to keep such Information confidential or otherwise not to
provide such Information or to the extent that such access would constitute a
waiver of the attorney-client privilege. Each of Spinco and Heinz shall hold,
and shall direct its Representatives to hold, any and all Information received
from any of the Parties, directly or indirectly, in confidence in accordance
with the Confidentiality Agreement. Notwithstanding the foregoing, Heinz may
redact from such Information any information relating to the Retained Business.
Without limiting the foregoing, Information may be requested under this Section
4.01 for audit, accounting, claims, litigation and tax purposes, as well as for
purposes of fulfilling disclosure and reporting obligations.
Section 4.02 Production of Witnesses; Records. Subject to Section 4.03,
after the Distribution Date, except in the case of an adversarial Litigation
Matter by one Party against the other Party (which shall be governed by such
discovery rules as may be applicable thereto), each of Heinz and Spinco shall
use its reasonable best efforts, and shall use its reasonable best efforts to
cause each member of its respective Group, to make available to the other Party
or any member of the other Party's Group, upon written request, such Group's (i)
former (to the extent practicable) and current (to the extent practicable)
directors, officers and employees as witnesses or otherwise and (ii) any books,
records or other documents within such Party's control or which such Party
otherwise has the ability to make available (other than materials covered by the
attorney-client privilege), to the extent that the requesting Party (giving
consideration to business demands of such directors, officers and employees)
reasonably determines relate to any such Litigation Matter, administrative or
other proceedings (including preparation for such matters or proceedings)
relating to the Spinco Business or the Retained Business on or prior to the
Distribution Date. If information other than that pertaining to the Spinco
Business is contained in such records, Heinz and Del Monte shall either agree
that such information may be omitted or redacted by the producing party, or
shall enter into appropriate secrecy commitments to protect such information.
The costs and expenses incurred in the provision of such witnesses and
information shall be paid by the Party requesting the availability of such
Persons.
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Section 4.03 Retention of Records. Except as otherwise agreed in writing,
or as otherwise provided in the other Transaction Agreements, each of Heinz and
Spinco shall use their reasonable best efforts, and shall cause the members of
its respective Group to use their reasonable best efforts, to retain all
Information in such Party's Group's possession or under its control relating
directly and primarily to the Spinco Business on or prior to the Distribution
Date (and in the case of Information to be retained by Heinz, only to the extent
such Information has not been delivered to Spinco pursuant to Section 2.02
hereof) until such Information is at least eight years old or until such later
date as may be required by law, except that if, prior to the expiration of such
time period, any member of either Party's Group wishes to destroy or dispose of
any such Information, prior to destroying or disposing of any of such
Information, (a) the Party whose Group is proposing to dispose of or destroy any
such Information shall provide no less than 30 days' prior written notice to the
other Party, specifying the Information proposed to be destroyed or disposed of,
and (b) if, prior to the scheduled date for such destruction or disposal, the
other Party requests in writing that any of the Information proposed to be
destroyed or disposed of be delivered to such Party, the Party whose Group is
proposing to dispose of or destroy such Information promptly shall arrange for
the delivery of the requested Information to a location specified by, and at the
expense of, the requesting Party. Notwithstanding the foregoing, Heinz may
redact from any such records any information relating to the Retained Business.
Section 4.04 No Representations or Warranties. EXCEPT AS MAY EXPRESSLY BE
SET FORTH HEREIN OR IN ANY OTHER TRANSACTION AGREEMENT, (A) NONE OF HEINZ, ITS
SUBSIDIARIES OR ANY OTHER PERSON MAKES ANY REPRESENTATION OR WARRANTY OF ANY
KIND WHATSOEVER, EXPRESS OR IMPLIED, WITH RESPECT TO THE SPINCO ASSETS, THE
SPINCO LIABILITIES OR THE SPINCO BUSINESS, ANY OF THE TRANSACTIONS CONTEMPLATED
HEREBY OR THEREBY (INCLUDING ANY CONSENTS OR APPROVALS REQUIRED IN CONNECTION
THEREWITH) OR THE BUSINESS, ASSETS, CONDITION OR PROSPECTS (FINANCIAL OR
OTHERWISE) OF, OR ANY OTHER MATTER INVOLVING THE SPINCO ASSETS, SPINCO
LIABILITIES OR THE SPINCO BUSINESS; (B) ALL OF THE SPINCO ASSETS TO BE
TRANSFERRED OR THE SPINCO LIABILITIES TO BE ASSUMED OR TRANSFERRED IN ACCORDANCE
WITH THIS AGREEMENT OR ANY OTHER TRANSACTION AGREEMENT SHALL BE TRANSFERRED OR
ASSUMED ON AN "AS IS, WHERE IS" BASIS, AND ALL IMPLIED WARRANTIES OF
MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE OR OTHERWISE ARE HEREBY
EXPRESSLY DISCLAIMED, AND (C) NONE OF THE PARTIES HERETO OR ANY OTHER PERSON
MAKES ANY REPRESENTATION OR WARRANTY WITH RESPECT TO ANY INFORMATION, DOCUMENTS
OR MATERIAL MADE AVAILABLE IN CONNECTION WITH THE CONTRIBUTION, THE DISTRIBUTION
OR THE MERGER OR THE ENTERING INTO OF THIS AGREEMENT, THE OTHER TRANSACTION
AGREEMENTS OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY.
Section 4.05 Use of Heinz Names.
(a) Except as specifically set forth in the Trademark License Agreement
and subject to the provisions of Section 4.07, as soon as reasonably practicable
after the Closing Date, and in no event later than the date that is one hundred
eighty (180) days after the Closing Date (or such
24
shorter period as may be required by law, rule or regulation, and/or no later
than the time any new such materials are printed or created within such one
hundred eighty (180) day time period), Spinco and each member of the Spinco
Group shall cease to use, directly or indirectly, any Trademark which includes
(i) the name "Heinz", any brand of any member of the Heinz Group or any
derivative thereof or (ii) any reference to a member of the Heinz Group, the
Heinz Group's consumer information telephone numbers, website addresses or other
contact information (collectively, the "Heinz Names"), including without
limitation on any and all (x) exterior signs and other identifiers located on
any of the property or premises included in the Spinco Assets (unless otherwise
agreed by the Parties in writing in their sole discretion); (y) letterhead,
envelopes, invoices, Internet sites and all other materials of any kind in any
media; or (z) labels, packaging, advertising, sales, promotional and all other
materials of any kind in any media. For the term of this transitional license,
Spinco agrees to maintain quality standards for all products of the Spinco
Business at least equal to those maintained by the Heinz Group at the Closing
Date. Notwithstanding anything to the contrary herein, Spinco shall have the
right to sell or use, as applicable, in the ordinary course of business any (i)
finished goods inventory in existence as of the Distribution Date that contains
any Heinz Name; and (ii) any labels and packaging materials in existence as of
the Distribution Date that contains any Heinz Name, without regard to the one
hundred eighty (180) day period set forth above; provided that Spinco shall use
its reasonable best efforts to sell or use such items in the ordinary course of
business consistent with past practice.
(b) Subject to Section 4.07 but without otherwise limiting Section
4.05(a), as soon as reasonably practicable after the Closing Date and in no
event later than the date that is one hundred eighty (180) days thereafter,
Spinco shall, at its own expense, remove (and, if necessary, on an interim
basis, cover up) any Heinz Name from all the materials specified in Section
4.05(a)(ii)(x), (y) and (z).
Section 4.06 Product Deductions and Returns. (a) In the event that
customers of the Spinco Business xxxx any member of the Heinz Group or make
deductions against any member of the Heinz Group's receivables, including for
trade promotion programs or with respect to returns (such as for damaged or
unsaleable goods), in each case, which should have been made against or are
applicable to the Spinco Business, Heinz shall promptly forward such xxxx or
deduction, with commercially reasonable supporting documentation, to Spinco
which shall promptly pay to Heinz the amount of all valid claims supported by
such documentation.
(b) In the event that customers of the Retained Business xxxx any member
of the Spinco Group or make deductions against any member of the Spinco Group's
receivables, including for trade promotion programs or with respect to returns
(such as for damaged or unsaleable goods), in each case, which should have been
made against or are applicable to the Retained Business, Spinco shall promptly
forward such xxxx or deduction, with commercially reasonable supporting
documentation, to Heinz which shall promptly pay to Spinco the amount of all
valid claims supported by such documentation.
(c) No Party hereto shall undertake any action to encourage returns of
products of the other Party's Business.
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Section 4.07 Brickwork and Northside Complex Signage. For a period of four
years commencing from the Effective Time:
(a) no member of the Spinco Group shall (i) alter, impede the visibility
of or materially diminish the effect of the Brickwork or the Northside Complex
Heinz Signage or (ii) erect or maintain any other signs or advertising at the
Northside Complex, other than ordinary business identification signs; and
(b) Heinz shall maintain the Brickwork and the Northside Complex Heinz
Signage in good order and Spinco will xxxxx Xxxxx and its Representatives, upon
reasonable notice, reasonable access to the Northside Complex in order to allow
Heinz to exercise its rights and satisfy any of its obligations with respect to
the foregoing.
ARTICLE V
MUTUAL RELEASES; INDEMNIFICATION
Section 5.01 Release of Pre-Closing Claims. (a) Except as provided in
Section 5.01(c), effective as of the Distribution Date, Heinz shall, for itself
and each other member of the Heinz Group, remise, release and forever discharge
each member of the Spinco Group from any and all Liabilities whatsoever owing to
the Heinz Group, whether at law or in equity (including any right of
contribution), whether arising under any contract or agreement, by operation of
law or otherwise, existing or arising from any acts or events occurring or
failing to occur or alleged to have occurred or to have failed to occur or any
conditions existing or alleged to have existed on or before the Distribution
Date, whether or not known as of the Distribution Date, including in connection
with the transactions and all other activities to implement the Contribution and
the Distribution.
(b) Except as provided in Section 5.01(c), effective as of the
Distribution Date, Spinco shall, for itself and each other member of the Spinco
Group, remise, release and forever discharge each member of the Heinz Group from
any and all Liabilities whatsoever owing to the Spinco Group, whether at law or
in equity (including any right of contribution), whether arising under any
contract or agreement, by operation of law or otherwise, existing or arising
from any acts or events occurring or failing to occur or alleged to have
occurred or to have failed to occur or any conditions existing or alleged to
have existed on or before the Distribution Date, whether or not known as of the
Distribution Date, including in connection with the transactions and all other
activities to implement the Contribution and the Distribution.
(c) Nothing contained in Sections 5.01(a) or 5.01(b) shall impair any
right of any Person to enforce this Agreement, any other Transaction Agreement
or any Contract between members of the Spinco Group, on the one hand, and the
Heinz Group, on the other hand, that does not terminate as of the Distribution
Date, in each case in accordance with its terms. Nothing contained in Section
5.01(a) or 5.01(b) shall release any Person from:
(i) any Liability provided in or resulting from any Contract
between members of the Spinco Group, on the one hand, and the
Heinz Group, on the other hand, that does not terminate as of
the Distribution Date;
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(ii) any Liability, contingent or otherwise, assumed, transferred,
assigned or allocated to the Group of which such Person is a
member in accordance with, or any other Liability of any
member of any Group under, this Agreement or any other
Transaction Agreement;
(iii) any Liability arising from or relating to the sale, lease,
construction, provision, or receipt of goods, payment for
goods, property or services purchased, obtained or used in the
ordinary course of business by a member of one Group from a
member of any other Group prior to the Distribution Date or
any related refund claims; or
(iv) any Liability the release of which would result in the release
of any Person other than a member of the Heinz Group or the
Spinco Group; provided that the Parties agree not to bring
suit or permit any of their Subsidiaries to bring suit against
any Person with respect to any Liability to the extent that
such Person would be released with respect to such Liability
by this Section 5.01 but for the provisions of this clause
(iv).
(d) No Actions as to Released Claims. Spinco agrees, for itself and as
agent for each member of the Spinco Group, not to make any claim or demand, or
commence any Action asserting any claim or demand, including any claim of
contribution or any indemnification, against Heinz or any other member of the
Heinz Group, with respect to any Liabilities released pursuant to this Section
5.01. Heinz agrees, for itself and as agent for each member of the Heinz Group,
not to make any claim or demand, or commence any Action asserting any claim or
demand, including any claim of contribution or any indemnification, against
Spinco or any other member of the Spinco Group, with respect to any Liabilities
released pursuant to this Section 5.01.
(e) Further Instruments. At any time, at the request of any other Party,
each Party shall cause each member of its respective Group to execute and
deliver releases reflecting the provisions of this Section 5.01.
Section 5.02 Indemnification by Spinco. Except as otherwise provided in
this Agreement and in the other Transaction Agreements, Spinco shall, and shall
cause each member of the Spinco Group to indemnify, defend (or, where
applicable, pay the defense costs for) and hold harmless the Heinz Indemnitees
from, against and in respect of losses relating to (a) the Spinco Liabilities
(including any Delayed Transfer Liabilities) and (b) any and all Liabilities
(including Third Party Claims) imposed on, sustained, incurred or suffered by
any of the Heinz Indemnitees that relate to, arise out of or result from the
Spinco Business, the Spinco Assets or the failure of Spinco or any other member
of the Spinco Group or any other Person to pay, perform or otherwise promptly
discharge any Spinco Liabilities in accordance with their terms, whether
occurring, arising, existing or asserted before, on or after the Distribution
Date.
Section 5.03 Indemnification by Heinz. Except as otherwise provided in
this Agreement and in the other Transaction Agreements, Heinz shall indemnify,
defend (or, where applicable, pay the defense costs for) and hold harmless the
Spinco Indemnitees from, against and in respect of any of losses relating to (a)
the Heinz Liabilities and (b) all Liabilities
27
(including Third Party Claims) imposed on, sustained, incurred or suffered by
any of the Spinco Indemnitees that relate to, arise out of or result from
the Retained Business, the Heinz Assets or the failure of any member of the
Heinz Group or any other Person to pay, perform or otherwise promptly discharge
any Heinz Liabilities in accordance with their terms, whether occurring,
existing or asserted before, on or after the Distribution Date.
Section 5.04 Terminal Island Environmental Indemnity. Notwithstanding any
provision of Section 5.02 or Section 5.03 hereof to the contrary, Heinz shall
indemnify, defend (or, where applicable, pay the defense costs for) and hold
harmless the Spinco Indemnitees from, against and in respect of any Liabilities
arising from the Environmental Remediation to the extent such Environmental
Remediation is (a) required under any applicable Environmental Law or under any
lease, license or other authorization in effect as of the date hereof for the
use of the Terminal Island Property, and (b) relates to an event or condition
occurring or existing as of or prior to the Closing Date. Notwithstanding the
foregoing, but subject, inter alia, to Section 5.06 hereof, none of the Spinco
Indemnitees shall be entitled to recover from Heinz any Liabilities under this
Section 5.04 until the total of all Liabilities otherwise indemnifiable under
this Section 5.04 that are not covered by an Insurance Policy or any insurance
policy of any member of the Spinco Group, or for which a third party (other than
any member of the Heinz Group) is not responsible exceeds $7.5 million, and then
only for fifty (50) percent of the amount by which such Liabilities exceed $7.5
million. The Parties agree that they shall reasonably cooperate and take all
reasonable actions, and make all reasonable omissions, to avoid and mitigate any
Liabilities subject to this Section 5.04.
Section 5.05 Indemnification Procedures.
(a) Notice of Claims. An Indemnitee shall give written notice (a "Notice
of Claim") to the Indemnifying Party within 20 business days after the
Indemnitee has knowledge of any Third Party Claim which an Indemnitee has
determined has given or could reasonably be expected to give rise to a right of
indemnification under this Agreement. No failure to give such Notice of Claim
within 20 business days as aforesaid shall affect the indemnification
obligations of the Indemnifying Party hereunder, except to the extent the
Indemnifying Party can demonstrate such failure materially prejudiced such
Indemnifying Party's ability to successfully defend the matter giving rise to
the claim. The Notice of Claim shall state the nature of the claim, the amount
of the liability, if known, and the method of computation thereof, all with
reasonable particularity and containing a reference to the provisions of this
Agreement in respect of which such right of indemnification is claimed or
arises.
(b) Third Party Claims. The obligations and liabilities of an Indemnifying
Party under this Article V with respect to Liabilities arising from claims of
any third party that are subject to the indemnification provisions provided for
in this Article V ("Third Party Claims") shall be governed by and contingent
upon the following additional terms and conditions. The Indemnitee at the time
it gives a Notice of Claim to the Indemnifying Party of the Third Party Claim
shall advise the Indemnifying Party that the Indemnifying Party shall be
permitted, at its option, to assume and control the defense of such Third Party
Claim at its expense and through counsel of its choice reasonably satisfactory
to the Indemnitee if it gives written notice of its intention to do so to the
Indemnitee within 20 days of its receipt of the Notice of Claim. In the event
the Indemnifying Party exercises its right to undertake the defense against any
such Third
28
Party Claim as provided above, the Indemnitee shall cooperate with the
Indemnifying Party in such defense and make available to the Indemnifying Party
all witnesses, pertinent records, materials and information in its possession or
under its control relating thereto as is reasonably required by the Indemnifying
Party, and the Indemnitee may participate by its own counsel and at its own
expense in defense of such Third Party Claim; provided, however, that if the
defendants in any Action shall include both the Indemnitee and the Indemnifying
Party and such Indemnitee shall have reasonably concluded in good faith that
counsel selected by the Indemnifying Party has a conflict of interest because of
the availability of different or additional defenses to such Indemnitee, such
Indemnitee shall have the right to select separate counsel to participate in the
defense of such Action on its behalf, at the expense of the Indemnifying Party;
provided, further, that such Indemnifying Party shall not, in connection with
any one such action or separate but substantially similar or related actions, be
liable for the reasonable fees and expenses of more than one separate firm of
attorneys (in addition to any local counsel). Notwithstanding the foregoing, the
Indemnitee, during the period the Indemnifying Party is determining whether to
elect to assume the defense of a matter covered by this Section 5.05(b), may
take such reasonable actions, at the Indemnifying Party's expense, as it deems
necessary to preserve any and all rights with respect to the matter, without
such actions being construed as a waiver of the Indemnitee's rights to defense
and indemnification pursuant to this Agreement. In the event the Indemnitee is,
directly or indirectly, conducting the defense against any such Third Party
Claim, the Indemnifying Party shall cooperate with the Indemnitee in such
defense and make available to it all such witnesses, records, materials and
information in its possession or under its control relating thereto as is
reasonably required by the Indemnitee and the Indemnifying Party may participate
by its own counsel and at its own expense in the defense of such Third Party
Claim.
(c) Settlement Procedures. Unless otherwise required by law, in no event
shall an Indemnitee admit any liability with respect to, or settle, compromise
or discharge, any Third Party Claim without the Indemnifying Party's prior
written consent (such consent not to be unreasonably withheld); provided,
however, that the Indemnitee shall have the right to settle, compromise or
discharge such Third Party Claim without the consent of the Indemnifying Party
if the Indemnitee releases the Indemnifying Party from its indemnification
obligation hereunder with respect to such Third Party Claim and such settlement,
compromise or discharge would not otherwise adversely affect the Indemnifying
Party. If the Indemnifying Party acknowledges in writing liability for a Third
Party Claim (as between the Indemnifying Party and the Indemnitee), the
Indemnifying Party shall be permitted to enter into, and the Indemnitee shall
agree to, any settlement, compromise or discharge of a Third Party Claim that
the Indemnifying Party may recommend and that by its terms obligates the
Indemnifying Party to pay the full amount of the liability in connection with
such Third Party Claim and releases the Indemnitee completely in connection with
such Third Party Claim and that would not otherwise adversely affect the
Indemnitee; provided further that the Indemnifying Party shall not agree to any
other settlement, compromise or discharge of a Third Party Claim not described
above without the prior written consent of the Indemnitee (such consent not to
be unreasonably withheld).
(d) Limitations on Assumptions of Defense. Notwithstanding the foregoing,
the Indemnifying Party shall not be entitled to assume the defense of any Third
Party Claim (and shall be liable for the reasonable fees and expenses of counsel
incurred by the Indemnitee in defending such Third Party Claim) if the Third
Party Claim seeks an order, injunction or other
29
equitable relief or relief for other than money damages against the Indemnitee
which the Indemnitee reasonably determines, after conferring with its counsel,
cannot be separated from any related claim for money damages. If such equitable
relief or other relief portion of the Third Party Claim can be so separated from
that for money damages, the Indemnifying Party shall be entitled to assume the
defense of the portion relating to money damages
Section 5.06 Indemnification Obligations Net of Insurance Proceeds and
Other Amounts. (a) Heinz and Spinco agree to treat any indemnification payments
pursuant to this Agreement as either a capital contribution or a distribution,
as the case may be, between Heinz and Spinco occurring immediately prior to the
Distribution. If the receipt or accrual of any such payment results in taxable
income to the Indemnitee, such payment shall be increased so that, after the
payment of any Taxes with respect to the payment, the Indemnitee shall have
realized the same net amount it would have realized had the payment not resulted
in taxable income.
(b) To the extent that any Liability that is subject to indemnification
under this Agreement gives rise to a deduction to the Indemnitee, the amount of
any indemnity payment under this Agreement shall be decreased by taking into
account any resulting actual reduction in Taxes of the Indemnitee. If a
reduction in Taxes of the Indemnitee occurs in a taxable period following the
period in which the indemnification payment is made, the Indemnitee shall
promptly repay the Indemnifying Party the amount of such reduction when actually
realized.
(c) To the extent that any Liability that is subject to indemnification
under this Agreement is covered by insurance, the amount of any indemnity
payment shall be net of the Net Proceeds of any insurance policy paid to the
Indemnitee with respect to such Liability. For purposes of this Section 5.06,
"Net Proceeds" shall mean the insurance proceeds actually received, less any
actual, additional or increased premium, deductibles, co-payments, other payment
obligations (including attorneys' fees and other costs of collection) or the
present value of any future cost which is quantifiable with reasonable
certainty, that relates to or arises from the making of such insurance claim.
(d) In no event shall an Indemnifying Party be liable for punitive damages
sustained or claimed by an Indemnitee except to the extent such damages arise
from a Third Party Claim. An Indemnitee shall take all reasonable steps to
mitigate a Liability upon becoming aware of any event, which could reasonably be
expected to give rise to such Liabilities. Liabilities shall be determined after
taking into account any indemnity, contribution or other similar payment
received by the Indemnitee from any third party with respect thereto.
Section 5.07 Additional Matters.
(a) No Relief of Insurer Obligations. An insurer who would otherwise be
obligated to defend or make payment in response to any claim shall not be
relieved of the responsibility with respect thereto or, solely by virtue of the
indemnification provisions hereof, or have any subrogation rights with respect
thereto, it being expressly understood and agreed that no insurer or any other
third party shall be entitled to a "windfall" (i.e., a benefit it would not be
entitled to
30
receive in the absence of the indemnification provisions hereof) by virtue of
the indemnification provisions hereof.
(b) Subrogation. In the event of payment by or on behalf of any
Indemnifying Party to or on behalf of any Indemnitee in connection with any
Third Party Claim, such Indemnifying Party shall be subrogated to and shall
stand in the place of such Indemnitee in any events or circumstances in respect
of which such Indemnitee may have any right or claim relating to such Third
Party Claim. Such Indemnitee shall cooperate with such Indemnifying Party in a
reasonable manner, and at the cost and expense of such Indemnifying Party, in
prosecuting any subrogated right or claim.
(c) Indemnification Payments. Indemnification required by this Article V
shall be made by periodic payments of the amount thereof during the
investigation or defense, as and when bills are received or loss, liability,
claim, damage or expense is incurred.
(d) Not Applicable to Taxes. The provisions of this Article V shall
not apply to Taxes (which are covered by the Tax Separation Agreement).
(e) Joint Defense and Cooperation. With respect to any Third Party Claim
in which both Heinz and Spinco are, or reasonably may be expected to be, named
as parties, or that otherwise implicates both Heinz and Spinco in a material
fashion, the Parties shall reasonably cooperate with respect to such Third Party
Claim and if the Parties agree, maintain a joint defense in a manner that will
preserve applicable privileges.
ARTICLE VI
INSURANCE
Section 6.01 Insurance Coverage; Cooperation. All insurance policies of
any Heinz Entity shall constitute Heinz Assets and shall be retained by Heinz
and the other members of the Heinz Group, together with all rights, benefits and
privileges thereunder (including the right to receive any and all return
premiums with respect thereto), except that Spinco will have the rights in
respect of Insurance Policies to the extent described in Section 6.02. Each of
Heinz and Spinco shall use commercially reasonable efforts to share such
information as is reasonably necessary in order to permit the other to manage
and conduct its insurance matters in an orderly fashion. Each of Heinz and
Spinco, at the request of the other, shall use commercially reasonable efforts
to cooperate with and assist the other in recoveries for claims made under any
insurance policy for the benefit of any member of either Group, and neither
Heinz nor Spinco, nor any member of either Group, shall take any action which
would be reasonably likely to jeopardize or otherwise interfere with either
Party's ability to collect any proceeds payable pursuant to any insurance
policy. Nothing in this Section 6.01 shall (x) preclude any member of any Group
from presenting any claim or from exhausting any policy limit, (y) require any
member of any Group to pay any premium or other amount or to incur any Liability
or (z) require any member of any Group to renew, extend or continue any policy
in force.
Section 6.02 Rights Under Insurance Policies. (a) Except as otherwise
specified in this Article VI or any other Transaction Agreement, members of the
Spinco Group shall have no
31
rights with respect to any insurance policies of any Heinz Entity, except that
Spinco will have the right to (x) assert claims and to resolve existing and
pending claims under Insurance Policies for any loss, liability or damage
arising out of insured incidents to the extent relating to the Spinco Business
occurring from the date coverage thereunder first commenced until the
Distribution Date and (y) require all rights, privileges and proceeds of such
Insurance Policies relating to the claims specified in clause (x); provided,
that (i) all of Heinz's and each member of the Heinz Group's reasonable
out-of-pocket costs and expenses incurred in connection with the foregoing shall
be promptly paid by Spinco and (ii) Heinz and the members of the Heinz Group
may, at any time, without liability or obligation to any member of the Spinco
Group (other than as set forth in Section 6.02(b)), amend, commute, terminate,
buy-out, extinguish liability under or otherwise modify any Insurance Policy
(and such Insurance Policy shall be subject to any such amendments,
commutations, terminations, buy-outs, extinguishments and modifications). No
member of the Heinz Group shall bear any Liability for the failure of an insurer
to pay any claim under any Insurance Policy. Notwithstanding anything to the
contrary herein, Spinco may at any time, and from time to time, inform Heinz by
written notice that it desires to terminate its rights to assert claims under
any or all Insurance Policies, in which case Spinco's rights to assert claims
relating to Spinco Liabilities and Insured Spinco Liabilities under such
Insurance Policy or Policies shall terminate immediately.
(b) In the event that after the Distribution Date, any member of the Heinz
Group proposes to amend, commute, terminate, buy-out, extinguish liability under
or otherwise modify any Insurance Policies under which Spinco has rights to
assert claims pursuant to Section 6.02(a) in a manner that would adversely
affect any such rights of Spinco, Heinz will give Spinco prior notice thereof.
If Spinco agrees to indemnify Heinz with respect to any cost or Liability
arising out of its failure to take any of the actions specified in the foregoing
sentence, Heinz shall not take such action so long as Heinz shall be reasonably
satisfied that Spinco shall be able to indemnify Heinz with respect to all such
costs and Liabilities.
Section 6.03 Spinco Insurance Coverage After the Distribution Date. From
and after the Distribution Date, Spinco, and Spinco alone, shall be responsible
for obtaining and maintaining insurance programs for its risk of loss and such
insurance arrangements shall be separate and apart from Heinz's insurance
programs.
Section 6.04 Responsibilities for Self-insured Obligations and Other
Obligations. (a) Spinco will reimburse Heinz for Spinco's pro rata share (based
on the aggregate amount of proceeds received in respect of claims under such
Insurance Policy by members of the Spinco Group) of all amounts necessary to
exhaust or otherwise satisfy all applicable self-insured retentions and Spinco's
pro rata share of all amounts for fronted policies, overages, deductibles and
retrospective or prospective premium adjustments and similar amounts not covered
by Insurance Policies.
(b) Each of Heinz and Spinco does hereby, for itself and each other member
of the Heinz Group and the Spinco Group, agree that all duties and obligations
under any Insurance Policy, including the fulfillment of any conditions and the
payment of any deductibles, retentions, co-insurance payment or retrospective
premiums, that correspond in any way with or may be necessary to perfect,
preserve or maintain an insured's right to obtain benefits under that
32
Insurance Policy, will be performed by the insured that is seeking the benefits
under that Insurance Policy, subject to the indemnification provisions herein.
Section 6.05 Claims Administration.
(i) Heinz or its designee shall be responsible for the claims
administration with respect to claims of any member of the Heinz Group under
Insurance Policies; and
(ii) Spinco or its designee shall be responsible for the claims
administration with respect to claims of Spinco under Insurance Policies.
Section 6.06 Procedures Regarding Insufficient Limits of Liability. In the
event that there are insufficient limits of liability available under the
Insurance Policies in effect prior to the Distribution Date to cover the
Liabilities of the Heinz Group and/or the Spinco Group that would otherwise be
covered by such Insurance Policies, then no member of the Spinco Group shall be
entitled to recovery for any claims under such Insurance Policies until the
clams of all members of the Heinz Group have been satisfied thereunder. If any
member of the Spinco Group has received proceeds under any such Insurance
Policies, Spinco shall reimburse Heinz all amounts to which any member of the
Heinz Group would have been entitled had its claim under such Insurance Policies
arisen prior to any recovery thereunder by any member of the Spinco Group.
Section 6.07 Cooperation. Heinz and Spinco will use their commercially
reasonable efforts to cooperate with each other and execute any additional
documents which are reasonably necessary to effectuate the provisions of this
Article VI.
Section 6.08 No Assignment or Waiver. This Agreement shall not be
considered as an attempted assignment of any rights or interest in violation of
any policy of insurance or as a contract of insurance and shall not be construed
to waive any right or remedy of any member of the Heinz Group in respect of any
Insurance Policy or any other contract or policy of insurance.
Section 6.09 No Liability. Spinco does hereby, for itself and as agent for
each other member of the Spinco Group, agree that no member of the Heinz Group
or any Heinz Indemnitee shall have any Liability whatsoever as a result of the
insurance policies and practices of Heinz and its Subsidiaries as in effect at
any time prior to the Distribution Date, including as a result of the level or
scope of any such insurance, the creditworthiness of any insurance carrier, the
terms and conditions of any policy or the adequacy or timeliness of any notice
to any insurance carrier with respect to any claim or potential claim or
otherwise.
Section 6.10 No Restrictions. Nothing in this Agreement shall be deemed to
restrict any member of the Spinco Group from acquiring at its own expense any
other insurance policy in respect of any Liabilities or covering any period.
Section 6.11 Further Agreements. The Parties acknowledge that they intend
to allocate financial obligations without violating any laws regarding
insurance, self-insurance or other financial responsibility. If it is determined
that any action undertaken pursuant to this Agreement or any other Transaction
Agreement is violative of any insurance, self-insurance or related financial
responsibility law or regulation, the Parties agree to work together to do
whatever is necessary to comply with such law or regulation while trying to
accomplish, to the
33
greatest possible extent, the allocation of financial obligations as intended in
this Agreement and any other Transaction Agreement.
ARTICLE VII
CONDITIONS TO THE CONTRIBUTION AND
DISTRIBUTION
Section 7.01 Conditions to the Distribution. The obligations of Heinz
pursuant to this Agreement to effect the Contribution and the Distribution shall
be subject to the fulfillment (or waiver by Heinz) at or prior to the
Distribution Date of the condition that each of the parties to the Merger
Agreement shall have irrevocably confirmed to each other that each condition in
Section 8.1 (other than Section 8.1(a)), 8.2 and 8.3 of the Merger Agreement to
such parties respective obligations to effect the Merger have been fulfilled or
shall be fulfilled at the Effective Time or are or have been waived by such
party, as the case may be.
ARTICLE VIII
TERMINATION
Section 8.01 Termination. Notwithstanding any provision hereof, this
Agreement may be terminated by Heinz and the Contribution and Distribution may
be abandoned prior to the Distribution Date at any time following termination of
the Merger Agreement in accordance with its terms; provided that this Agreement
may not be terminated for any other reason without the prior written consent of
Del Monte.
Section 8.02 Effect of Termination. In the event of any termination of
this Agreement prior to the Distribution Date pursuant to Section 8.01, no Party
to this Agreement (or any of its directors or officers) shall have any Liability
or further obligation to any other Party or third party with respect to this
Agreement.
ARTICLE IX
MISCELLANEOUS
Section 9.01 Entire Agreement. This Agreement (together with the other
Transaction Agreements, the Confidentiality Agreement, the exhibits and the
schedules and the other documents delivered pursuant hereto) constitutes the
entire agreement of the Parties and supersedes all prior and contemporaneous
agreements and understandings (including term sheets), both written and oral,
between the Parties, or either of them, with respect to the subject matter
hereof. All exhibits and schedules attached to this Agreement are expressly made
a part of, and incorporated by reference into, this Agreement.
Section 9.02 Expenses. Except as expressly set forth herein, all costs and
expenses incurred in connection with this Agreement and the transactions
contemplated hereby shall be paid in accordance with Section 9.3 of the Merger
Agreement.
Section 9.03 Governing Law. This Agreement shall be governed by, and
construed in accordance with, the laws of the State of New York. EACH OF THE
PARTIES TO THIS
34
AGREEMENT HEREBY IRREVOCABLY AND UNCONDITIONALLY (i) AGREES TO BE SUBJECT TO,
AND HEREBY CONSENTS AND SUBMITS TO, THE JURISDICTION OF THE COURTS OF THE STATE
OF NEW YORK AND OF THE FEDERAL COURTS SITTING IN THE STATE OF NEW YORK, (ii) TO
THE EXTENT SUCH PARTY IS NOT OTHERWISE SUBJECT TO SERVICE OF PROCESS IN THE
STATE OF NEW YORK, HEREBY APPOINTS THE CORPORATION TRUST COMPANY, AS SUCH
PARTY'S AGENT IN THE STATE OF NEW YORK FOR ACCEPTANCE OF LEGAL PROCESS AND (iii)
AGREES THAT SERVICE MADE ON ANY SUCH AGENT SET FORTH IN CLAUSE (ii) ABOVE SHALL
HAVE THE SAME LEGAL FORCE AND EFFECT AS IF SERVED UPON SUCH PARTY PERSONALLY
WITHIN THE STATE OF NEW YORK.
Section 9.04 Notices. All notices and other communications hereunder shall
be in writing and shall be deemed given upon (a) a transmitter's confirmation of
a receipt of a facsimile transmission (but only if followed by confirmed
delivery of a standard overnight courier the following business day or if
delivered by hand the following business day), (b) confirmed delivery of a
standard overnight courier or when delivered by hand or (c) the expiration of
five business days after the date mailed by certified or registered mail (return
receipt requested), postage prepaid, to the Parties at the following addresses
(or at such other addresses for a Party as shall be specified by like notice):
If to Heinz or any member of the Heinz Group, to:
X. X. Xxxxx Company
000 Xxxxx Xxxxxx, 00xx Xxxxx
Xxxxxxxxxx, Xxxxxxxxxxxx 00000
Attention: General Counsel
Facsimile: (000) 000-0000
with a copy (which shall not constitute effective
notice) to:
Xxxxxxx Xxxxxxx & Xxxxxxxx
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxx X. Xxxxx, Esq.
Xxxxxxxx X. Xxxxxxxxxx, Esq.
Facsimile: (000) 000-0000
If to Spinco or any member of the Spinco Group prior to the Distribution
Date, to:
SKF Foods Inc.
000 Xxxxx Xxxxxx, 00xx Xxxxx
Xxxxxxxxxx, Xxxxxxxxxxxx 00000
Attention: Secretary
Facsimile: (000) 000-0000
35
with a copy (which shall not constitute effective notice) to:
Xxxxxxx Xxxxxxx & Xxxxxxxx
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxx X. Xxxxx, Esq.
Xxxxxxxx X. Xxxxxxxxxx, Esq.
Facsimile: (000) 000-0000
If to Spinco or any member of the Spinco Group on or after the
Distribution Date, to:
SKF Foods Inc.
One Market @ The Landmark
Xxx Xxxxxxxxx, Xxxxxxxxxx 00000
Attention: Xxxxx Xxxxxx and Xxxxx X. Xxxxxx
Facsimile: (000) 000-0000 and (000) 000-0000
with a copy (which shall not constitute effective notice) to:
Del Monte Foods Company
One Market @ The Landmark
Xxx Xxxxxxxxx, Xxxxxxxxxx 00000
Attention: Xxxxx Xxxxxx and Xxxxx X. Xxxxxx
Facsimile: (000) 000-0000 and (000) 000-0000
Xxxxxx Xxxx & Xxxxxxxx L.L.P.
Xxx Xxxxxxxxxx Xxxxxx
Xxxxxxxxxx Xxxxx, 26th, 00xx xxx 00xx Xxxxxx
Xxx Xxxxxxxxx, Xxxxxxxxxx 00000
Attention: Xxxxxxx X. Xxxxx, Esq.
Xxxxxxxxx Xxxxxxxxx, Esq.
Facsimile: (000) 000-0000
Section 9.05 Amendment and Modification. This Agreement may be amended,
modified or supplemented only by a written agreement signed by Heinz, Spinco and
Del Monte; provided that if such amendment, modification or supplement does not,
individually or together with all other such amendments, modifications or
supplements, result in any material cost or detriment to Del Monte (or,
following the Distribution Date, Spinco) or result in any material cost or
detriment to Del Monte (or, following the Distribution Date, Spinco) from the
transactions contemplated hereby, such agreement by Del Monte to so amend,
modify or supplement shall not be unreasonably withheld or delayed.
Section 9.06 Assignment; Binding Effect. Neither this Agreement nor any of
the rights, benefits or obligations hereunder may be assigned by Spinco or Heinz
(whether by operation of law or otherwise) without the prior written consent of
the other Party and Del Monte. Subject to the preceding sentence, this Agreement
shall be binding upon, inure to the benefit of and be enforceable by Spinco and
Heinz and their respective successors and permitted assigns.
36
Section 9.07 No Third Party Beneficiaries. Except for the provisions of
Sections 2.05 and 5.05 hereof relating to indemnification, which are also for
the benefit of the Indemnitees, and except for those provisions of the Agreement
that require a Del Monte Consent, which are also for the benefit of Del Monte,
nothing in this Agreement, express or implied, is intended to or shall confer
upon any Person (other than Heinz, Spinco and, to the extent set forth herein,
Del Monte and their respective successors or permitted assigns) any legal or
equitable right, benefit or remedy of any nature whatsoever under or by reason
of this Agreement and no Person (other than as so specified) shall be deemed a
third party beneficiary under or by reason of this Agreement.
Section 9.08 Survival. All post-closing covenants and agreements of the
Parties contained in this Agreement will remain in full force and effect and
survive the Distribution Date and the Closing Date.
Section 9.09 Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall be deemed to be an original, but all of which
together shall constitute one agreement binding on Spinco and Heinz,
notwithstanding that not all Parties are signatories to the same counterpart.
Section 9.10 Certain Construction Rules. The article and section headings
and the table of contents contained in this Agreement are for reference purposes
only and shall not affect in any way the meaning or interpretation of this
Agreement. As used in this Agreement, unless otherwise provided to the contrary,
(a) all references to days or months shall be deemed references to calendar days
or months and (b) any reference to a "Section," "Article," "Exhibit" or
"Schedule" shall be deemed to refer to a section or article of this Agreement or
an exhibit or schedule to this Agreement. The words "hereof," "herein" and
"hereunder" and words of similar import referring to this Agreement refer to
this Agreement as a whole and not to any particular provision of this Agreement.
Whenever the words "include," "includes" or "including" are used in this
Agreement, they shall be deemed to be followed by the words "without
limitation." Unless otherwise specifically provided for herein, the term "or"
shall not be deemed to be exclusive.
Section 9.11 Waiver. No waiver by either Party of any of the provisions
hereof shall be effective unless specifically set forth in writing and executed
by the Party so waiving. Any waiver hereunder shall be effective only in the
specific instance and for the specific purpose for which it is given. No failure
or delay on the part of Spinco or Heinz in exercising any right, power or
privilege under this Agreement shall operate as a waiver thereof, nor shall any
single or partial exercise of any right, power or privilege hereunder preclude
any other or further exercise thereof or the exercise of any other right, power
or privilege.
Section 9.12 Severability. If any provision of this Agreement, or the
application of any such provision to any Person or circumstance, shall be
declared judicially to be invalid, unenforceable or void, such decision shall
not have the effect of invalidating or voiding the remainder of this Agreement,
it being the intent and agreement of Spinco and Heinz that this Agreement shall
be deemed amended by modifying such provision to the extent necessary to render
it valid, legal and enforceable while preserving its intent or, if such
modification is not
37
possible, by substituting therefore another provision that is legal and
enforceable and that achieves the same objective.
Section 9.13 Limited Liability. Notwithstanding any other provision of
this Agreement, no stockholder, director, officer, Affiliate, agent or
representative of Spinco or Heinz, in its capacity as such, shall have any
liability in respect of or relating to the covenants or obligations of such
Party under this Agreement or in respect of any certificate delivered with
respect hereto or thereto and, to the fullest extent legally permissible, each
of Spinco and Heinz, for itself and its stockholders, directors, officers and
Affiliates, waives and agrees not to seek to assert or enforce any such
liability that any such Person otherwise might have pursuant to applicable law.
38
IN WITNESS WHEREOF, the Parties have caused this Agreement to be duly
executed as of the date first above written.
X. X. XXXXX COMPANY
By: /s/ Xxxxxxx X. Xxxxxxxx
-----------------------------------
Name: Xxxxxxx X. Xxxxxxxx
Title: Senior Vice President
SKF FOODS INC.
By: /s/ Xxxxxxxx X. Ring
----------------------------------
Name: Xxxxxxxx X. Ring
Title: Executive Vice President
