Exhibit 2.1
Conformed Copy
AGREEMENT
AND
PLAN OF MERGER
among
TPG PARTNERS, L.P.
TPG SHIELD ACQUISITION CORPORATION
and
DEL MONTE FOODS COMPANY
dated as of
February 21, 1997
amended and restated
as of
April 14, 1997
TABLE OF CONTENTS
Page
ARTICLE I CERTAIN DEFINITIONS 2
ARTICLE II THE RECAPITALIZATION TRANSACTIONS 10
2.1 Amendment of DMFC's Articles of Incorporation
and the Stockholders Agreement 10
2.2 Subscription of Sub Stock 10
2.3 New Term Loan and New Revolving Credit 10
2.4 The Senior Subordinated Notes 10
2.5 The DMFC Dividend and Repayment of Existing
Indebtedness 11
2.6 The Merger 11
2.7 Effect of the Merger 11
2.8 Charter, By-laws, Directors and Officers of the
Surviving Corporation 11
2.9 Conversion or Cancellation of DMFC Common Stock
and DMFC Preferred Stock 12
2.10 Surrender of DMFC Share Certificates; Payment
for DMFC Common Stock and DMFC Preferred Stock 13
ARTICLE III CLOSING OF TRANSACTIONS 15
ARTICLE IV REPRESENTATIONS AND WARRANTIES OF DMFC 15
4.1 Organization 15
4.2 Authority; Enforceability 16
4.3 Capitalization 16
4.4 No Breach 17
4.5 Financial Statements; Certain Actions 18
4.6 Consents 19
4.7 Actions and Proceedings 19
4.8 Brokers 19
4.9 Taxes and Tax Returns 20
4.10 Title to Property; Sufficiency 21
4.11 Real Property 21
4.12 Intellectual Property 23
4.13 Compliance with Legal Requirements 25
4.14 Environmental 26
4.15 Outstanding Commitments 27
4.16 Employee Benefits 27
4.17 Employee Relations 30
4.18 Insurance 30
4.19 Customers and Suppliers 30
4.20 Certain Financial Information 31
4.21 Affiliate Transactions 31
4.22 Inventory and Accounts Receivable 31
4.23 Management Payments 32
ARTICLE V REPRESENTATIONS AND WARRANTIES OF PURCHASERS 32
5.1 Organization 32
5.2 Authority; Enforceability 32
5.3 No Breach 33
5.4 Consents 33
5.5 Actions and Proceedings 33
5.6 Brokers 33
5.7 Availability of Funds 33
5.8 Surviving Corporation After the Merger 34
ARTICLE VI COVENANTS OF DMFC 34
6.1 Ordinary Course of Business 34
6.2 Access to Information 37
6.3 Stockholder Approvals; Stock Conversions 37
6.4 Cancellation of Certain Arrangements 38
6.5 No Shop Provision 38
6.6 Affiliate Transactions 38
6.7 Recapitalization Accounting Treatment 38
ARTICLE VII COVENANTS OF PURCHASERS 39
7.1 Employee Benefits 39
7.2 Executive Arrangements 39
7.3 Indemnification: Officers' and Directors' Insurance 40
7.4 Financing 41
ARTICLE VIII ADDITIONAL AGREEMENTS 42
8.1 Company Debt 42
8.2 Further Actions 42
8.3 Certain Notifications 43
8.4 Confidentiality 43
8.5 Fulfillment of Conditions and Certain Notifications 44
8.6 Expenses and Break-Up Fee 44
ARTICLE IX CONDITIONS PRECEDENT TO CLOSING OBLIGATIONS 45
9.1 Conditions Precedent to Obligations of Purchasers 45
9.2 Conditions Precedent to Obligations of DMFC 46
ARTICLE X TERMINATION 48
10.1 Grounds for Termination 48
10.2 Effect of Termination 49
ARTICLE XI MISCELLANEOUS 49
11.1 Non-Survival of Representations and Warranties 49
11.2 Publicity 49
11.3 Costs and Expenses 49
11.4 Notices 49
11.5 Counterparts 51
11.6 Entire Agreement 51
11.7 Headings 51
11.8 Governing Law 51
11.9 No Third Party Rights; Assignment 51
11.10 Waivers and Amendments 51
11.11 Consent to Jurisdiction 52
Exhibits
Exhibit A-1 Form of Irrevocable Proxy
Schedules
Schedule 2.9(a) Allocation of Consideration
Schedule 2.9(b) Calculation of Series F Share Consideration
Schedule 2.10(b) Persons payable by Purchasers
Schedule 4.1 List of Subsidiaries, etc.
Schedule 4.3(a) Outstanding Capital Stock, etc.
Schedule 4.3(b) Liens on Capital Stock
Schedule 4.4 Breaches, etc.
Schedule 4.5 Liabilities
Schedule 4.6 Consents (DMFC)
Schedule 4.7 Actions and Proceedings
Schedule 4.9 Taxes
Schedule 4.10 Permitted Liens
Schedule 4.11 Real Property
Schedule 4.12(a) Intellectual Property
Schedule 4.12(b) Infringement of Intellectual Property Rights
Schedule 4.13(a) Compliance with Legal Requirements
Schedule 4.13(b) Permits
Schedule 4.14 Environmental Matters
Schedule 4.15 Contracts
Schedule 4.16(a) Employees Benefit Plans
Schedule 4.16(b) Qualification of Plans
Schedule 4.16(f) Certain Employee Benefit Plan Liabilities
Schedule 4.16(g) Severance Payments, etc.
Schedule 4.16(h) Changes in Plans
Schedule 4.16(i) Violations relating to Employment Matters
Schedule 4.16(j) Certain Liabilities with respect to Employees
Schedule 4.16(k) Liabilities relating to Plan Insurance Contracts
Schedule 4.16(l) Indebtedness Owed to Employees
Schedule 4.16(m) Certain Benefit Arrangements
Schedule 4.17(a) Employee Relations
Schedule 4.17(b) Collective Bargaining
Schedule 4.19 Customers and Suppliers
Schedule 4.20(a) DMFC Combining Statement
Schedule 4.20(b) Evaluation of Adjusted Calendar Year 1996
Schedule 4.21 Affiliate Transactions
Schedule 6.1 Actions Outside the Ordinary Course of Business
Schedule 6.1(b)(xiv) 1997 Capital Expenditure Plan
Schedule 6.4 Certain Arrangements
Schedule 7.2 Executive Arrangements
AGREEMENT AND PLAN OF MERGER (this "Agreement"), dated
as of February 21, 1997, as amended and restated as of April 14,
1997, among TPG Partners, L.P., a Delaware limited partnership
("Parent"), and TPG Shield Acquisition Corporation, a Maryland
corporation ("Sub" and, together with Parent, "Purchasers") and
Del Monte Foods Company, a Maryland corporation ("DMFC").
WHEREAS, Parent owns all of the issued and outstanding
shares of capital stock of Sub;
WHEREAS, Sub is a transitory corporation established
solely to effect the Merger (as defined below), and each of the
new stockholders of Sub is subscribing for shares of Sub for the
purpose of acquiring through the Merger an equity interest in the
Surviving Corporation (as defined below).
WHEREAS, the Purchasers and DMFC have heretofore
entered into an Agreement and Plan of Merger dated as of February
21, 1997 (the "Original Agreement"), pursuant to which the
Purchasers and DMFC provided for the acquisition of DMFC by
Purchasers subject to the terms of the Original Agreement;
WHEREAS, the parties to the Original Agreement desire
to amend and restate the Original Agreement in order to provide
for the Recapitalization (as defined below);
WHEREAS, the Boards of Directors of DMFC and Sub, and
Parent, as sole stockholder of Sub, have approved a merger of Sub
with and into DMFC upon the terms and subject to the conditions
set forth in this Agreement (the "Merger");
WHEREAS, stockholders of DMFC have granted to
Purchasers irrevocable proxies with respect to at least 66-2/3%
of the shares outstanding of each class of DMFC Common Stock (as
defined below) and of each series of DMFC Preferred Stock (as
defined below) authorizing the approval of the Merger as set
forth in the Original Agreement, amended to the extent necessary
to permit the transactions contemplated thereby to be accounted
for pursuant to recapitalization accounting (the
"Recapitalization"); and
WHEREAS, in order to effect the Recapitalization, the
parties hereto and certain other parties named herein desire to
consummate, as of the Closing (as defined below), a series of
related transactions, including, without limitation, the
following transactions: (i) the amendment of the Articles of
Incorporation of DMFC and the Stockholders Agreement (as defined
below); (ii) the subscription by Parent and certain other equity
investors of newly issued shares of common stock, par value $0.01
per share, of Sub ("Sub Common Stock"); (iii) the making of new
secured and senior
subordinated financing to the Company (as defined below); (iv)
the repayment of certain existing indebtedness of the Company;
and (v) the Merger.
NOW, THEREFORE, in consideration of the mutual
representations, warranties, covenants, agreements and
undertakings contained or referred to in this Agreement, and
subject to the satisfaction or waiver of the conditions to this
Agreement, the parties hereto hereby agree as follows:
ARTICLE I
CERTAIN DEFINITIONS
1.1 Capitalized terms used in this Agreement are used
as defined in this Article I or elsewhere in this Agreement (such
terms to be equally applicable to the singular and plural forms
thereof).
"Affiliate" means, with respect to any Person, any
other Person directly or indirectly controlling, controlled by or
under common control with, such Person; for purposes of this
definition, "control" means the possession, directly or
indirectly, of the power to direct or cause the direction of the
management and policies of an entity, whether through the
ownership of voting securities or otherwise.
"Assets" means all Properties of a member of the Del
Monte Group.
"CERCLA" means the Comprehensive Environmental
Response, Compensation and Liability Act of 1980, as amended.
"Class A Common Stock" means the Class A Common Stock,
par value $.01 per share, of DMFC.
"Class B Common Stock" means the Class B Common Stock,
par value $.01 per share, of DMFC.
"Class C Common Stock" means the Class C Common Stock,
par value $.01 per share, of DMFC.
"Class D Common Stock" means the Class D Common Stock,
par value $.01 per share, of DMFC.
"Class E Common Stock" means the Class E Common Stock,
par value $.01 per share, of DMFC.
"Class F Common Stock" means the Class F Common Stock,
par value $.01 per share, of DMFC.
"Code" means the Internal Revenue Code of 1986, as
amended.
"Company" means Del Monte Corporation, a New York
corporation and a wholly-owned subsidiary of DMFC.
"Contracts" means any and all written and enforceable
oral contracts, agreements, guarantees, commitments,
arrangements, leases, licenses, mortgages, bonds, notes and other
instruments and obligations, excluding any Permits.
"Del Monte" means DMFC and the Company.
"Del Monte Group" means DMFC, the Company and the
Subsidiaries of the Company.
"Department" means the State Department of Assessments
and Taxation of Maryland.
"DMFC Common Stock" means the Class A Common Stock,
the Class B Common Stock, the Class C Common Stock, the Class D
Common Stock, the Class E Common Stock and the Class F Common
Stock.
"DMFC Preferred Stock" means the Series A Preferred
Stock, the Series B Preferred Stock, the Series C Preferred
Stock, the Series D Preferred Stock, the Series E Preferred Stock
and the Series F Preferred Stock.
"DMFC's Knowledge" means the actual knowledge of, without
any inquiry being required by, Xxxxx X. Xxxxxx, Xxxx X. Xxxxxx,
Xxxxx X. Xxxxxx, Xxxxxx X. Xxxxxxx, Xxxxx Xxxxxxxx, Xxxxx X.
Xxxxxx, Xxxxxxx X. Xxxxxxx, Xxxxxxx X. Xxxxxx, Xxxx Xxxxxx, Xxxxx
Xxxxxxxxx, Xxxxxx Xxxxxxx and Xxxxxxx Xxxxx.
"Dollars" or "$" means the lawful currency of the United
States of America.
"Effective Time" means the time and date when the
Articles of Merger are accepted for record by the Department.
"ERISA" means the Employee Retirement Income Security
Act of 1974, as amended from time to time, and, unless the
context otherwise requires, the rules and regulations promulgated
thereunder from time to time.
"ERISA Affiliate" means any person (as defined in
Section 3(9) of ERISA), including each trade or business (whether
or not incorporated), which would be deemed to be a member of a
single "controlled group" within the meaning of Section 414(b),
(c), (m) or (o) of the Code with any member of the Del Monte
Group.
"Existing Debt" means the debt of the Company
outstanding at the Closing Date under the Term Loan Agreement,
the Revolving Credit Agreement, the PIK Notes and the 12-1/4%
Subordinated Guaranteed Pay-In-Kind Notes, if any, due 2002 of
the Company.
"Existing Senior Debt" means the debt of the Company
outstanding from time to time under the Term Loan Agreement and
the Revolving Credit Agreement.
"Financial Statements" means the audited consolidated
financial statements of DMFC as of, and for the three years
ended, June 30, 1996, and the unaudited financial statements of
DMFC as of, and for the six months ended, December 31, 1996.
"Financing Agreements" means the Senior Secured Credit
Agreement and the Senior Subordinated Financing Agreement.
"GAAP" shall mean generally accepted accounting
principles in the United States of America which are applicable
to the circumstances as of the date of determination.
"Governmental Authority" means any United States
federal, state or local or any foreign government, governmental,
regulatory or administrative authority, agency or commission or
any court, tribunal or judicial or arbitral body.
"HSR Act" means the Xxxx-Xxxxx-Xxxxxx Antitrust
Improvements Act of 1976, as amended.
"Intellectual Property Rights" means the Trademarks
and any and all patents, copyrights, formulas, inventions,
technical information, know-how, technology, proprietary designs,
processes, trade secrets, rights in plant varieties, and other
similar intellectual property rights and any registrations and
applications therefor owned or filed by any member of the Del
Monte Group or currently used in, or required for the Operations,
and all Contracts for the licensing or sub-licensing of the same
to or from third parties.
"January Balance Sheet" means the unaudited
consolidated balance sheet of DMFC as of January 26, 1997.
"Judgments" means any and all judgments, orders,
directives, rulings, decisions, injunctions (temporary,
preliminary or permanent), decrees or awards of any Governmental
Authority.
"Laws" means all laws (whether statutory or
otherwise), rules, regulations and Judgments of all Governmental
Authorities.
"Legal Requirements" means any and all applicable (i)
Laws, (ii) Contracts with any Governmental Authority relating to
compliance with Laws and (iii) Permits.
"Liens" means any and all liens, mortgages, charges,
security interests, claims, leases, charges, options, rights of
first refusal, easements, or other real estate declarations,
covenants, conditions, restrictions or servitudes, transfer
restrictions, encumbrances or other similar restrictions or
limitations of any nature whatsoever.
"Loss" means any loss, liability, damage, cost or
expense whatsoever (including, without limitation, reasonable
attorneys' fees and expenses).
"Material Adverse Effect" means a material adverse
effect on the business operations, properties or financial
condition of the Del Monte Group taken as a whole or on the fruit
or vegetable business of the Del Monte Group, and shall include
any effect that would reasonably be expected to have such a
material adverse effect.
"Material Contract" means:
(i) any Contract which, in any case, involves
future payments (including reasonably anticipated potential
payments) thereunder of $10,000,000 or more in the aggregate or
$2,000,000 or more in any year (or its equivalent in any
currency); and
(ii) any Contract which:
(A) is with any labor union or association
representing employees;
(B) limits or affects the freedom of any
member of the Del Monte Group (other than a Subsidiary of the
Company) to engage in any line of business in any geographic area;
(C) relates to the borrowing of money, or the
guaranteeing of any such borrowing;
(D) is a material partnership, joint venture,
shareholders' or other similar contract with any Person;
(E) other than this Agreement (A) limits or
contains restrictions on the ability of any member of the Del Monte
Group (other than a Subsidiary of the Company) to declare or pay
dividends on, to make any other distribution in respect of or to
issue or purchase, redeem or otherwise acquire its capital stock,
to incur indebtedness, to incur or suffer to exist any lien, to
purchase or sell any assets and properties, to change the lines
of business in which it participates or engages or to engage in
any merger or other business combination or (B) requires any
member of the Del Monte Group (other than Subsidiaries of the
Company) to maintain specified financial ratios or levels of net
worth or other indicia of financial condition;
(F) is with any of the stockholders of DMFC or
any Affiliate thereof;
(G) is to acquire or dispose of all or part of
the equity securities of any business and any buy/sell or other Contract
relating to the purchase or sale of capital stock of any member
of the Del Monte Group;
(H) is a guarantee of third party obligations;
(I) is a material license (whether as licensor
or licensee) or similar agreement permitting the use of any Intellectual
Property Rights; or
(J) is a broker or finder's agreement.
"MGCL" means the Maryland General Corporation Law.
"Xxxxxx Xxxxxxx" means Xxxxxx Xxxxxxx & Co. Incorporated.
"New Revolving Credit" means the revolving credit to
be made available to the Company by the Senior Secured Lenders
pursuant to the Senior Secured Credit Agreement for an aggregate
amount of up to $350.0 million.
"New Term Loan" means the loan to be made to the
Company by the Senior Secured Lenders pursuant to the Senior
Secured Credit Agreement for an aggregate amount of $380.0
million.
"Operations" means all businesses and activities
currently conducted by the Del Monte Group including, but not
limited to, the manufacturing, processing, assembling, packaging,
distribution and marketing of canned or packaged vegetables,
fruits, tomato products, pineapples and all other products
currently sold by the Del Monte Group.
"Permits" means any and all written permits,
authorizations, approvals, registrations, waivers, variances and
licenses under any (x) Laws or (y) Contracts with any
Governmental Authority relating to compliance with Laws.
"Permitted Encumbrances" means any of the following:
(i) Liens listed on Schedule 4.10; (ii) Liens for Taxes accrued
but not yet due or for Taxes the validity of which is being
contested in good faith by appropriate proceedings and for which,
if required at such time by GAAP, adequate provision has been
made; (iii) Liens that, either individually or in the aggregate,
would not have a Material Adverse Effect; (iv) statutory liens of
carriers, warehousemen, mechanics, workmen and materialmen for
liabilities and obligations incurred in the ordinary course of
business that are not yet delinquent or are being contested in
good faith; (v) Liens disclosed in the Financial Statements; and
(vi) Liens which constitute (A) valid leases or subleases from
any member of the Del Monte Group to third parties, (B) security
agreements and licenses with respect to Intellectual Property
Rights entered into between any member of the Del Monte Group and
third parties or (C) security agreements entered into by any
member of the Del Monte Group pursuant to the Term Loan
Agreement, Revolving Credit Agreement or PIK Note Indenture.
"Person" means any individual, partnership, joint
venture, firm, corporation, association, trust or other entity or
any government or political subdivision or any agency, department
or instrumentality thereof.
"PIK Note Indenture" means the Indenture among the
Company, DMFC and Bankers Trust Company, dated as of September 1,
1996, relating to the Senior Subordinated Pay-in-Kind Notes due
2002 of the Company.
"PIK Notes" means the Senior Subordinated Guaranteed
PIK Notes due 2002 of the Company, guaranteed by DMFC, issued
under the PIK Note Indenture.
"Properties" means all properties and assets (real,
personal or mixed, tangible or intangible) owned or leased by any
Person.
"Purchase Price" means $436,000,000 reduced by the
amount of cash not paid upon conversion of shares of Series F
Preferred Stock as a result of holders of such shares electing
stock consideration rather than cash consideration in accordance
with Section 2.9(b) of this Agreement.
"Revolving Credit Agreement" means the Amended and
Restated Revolving Loan and Security Agreement, dated as of June
15, 1995, among the Company, certain lenders party thereto and
Bank America Business Credit, Inc., as Agent, as amended on
December 8, 1995, December 15, 1995 and September 11, 1996.
"Securities Act" means the Securities Act of 1933, as
amended.
"Seller's Group" means (a) any "affiliated group", as
defined in Section 1504(a) of the Code, that includes or at any
time included DMFC or any predecessor of or successor to DMFC (or
another such predecessor or successor) and (b) any group of one
or more corporations that includes or at any time included DMFC
or any predecessor of or successor to DMFC (or another such
predecessor or successor) that is or was required to file or have
filed a return on a consolidated or combined basis for the
purposes of any Law relating to Taxes.
"Senior Secured Credit Agreement" means that certain
senior secured term and revolving loan agreement to be entered
into between the Company and the Senior Secured Lenders pursuant
to the Commitment Letters.
"Senior Secured Lenders" means Bank of America
National Trust and Savings Association and Bankers Trust Company
and the other lenders pursuant to the Senior Secured Credit
Agreement.
"Senior Subordinated Financing Agreement" means that
certain senior subordinated financing agreement to be entered
into between the Company and the Senior Subordinated Placement
Agents pursuant to the Commitment Letters.
"Senior Subordinated Notes" means the notes to be
issued by the Company and to be privately placed by the Senior
Subordinated Placement Agents pursuant to the Senior Subordinated
Financing Agreement in an aggregate amount of $150.0 million.
"Senior Subordinated Placement Agents" means BT Securities
Corporation, BankAmerica Securities, Inc. and Bear, Xxxxxxx & Co. Inc.
"Series A Preferred Stock" means the Series A
Cumulative Exchangeable Preferred Stock, par value $.01 per
share, of DMFC, which has been issued in two sub-series, Series
A-1 and Series A-2.
"Series B Preferred Stock" means the Series B
Cumulative Exchangeable Preferred Stock, par value $.01 per
share, of DMFC.
"Series C Preferred Stock" means the Series C
Cumulative Preferred Stock, par value $.01 per share, of DMFC.
"Series D Preferred Stock" means the Series D
Cumulative Preferred Stock, par value $.01 per share, of DMFC.
"Series E Preferred Stock" means the Series E
Cumulative Preferred Stock, par value $.01 per share, of DMFC.
"Series F Preferred Stock" means the Series F
Cumulative Preferred Stock, par value $.01 per share, of DMFC.
"Specified Real Estate" means the tracts or parcels of
land listed on Schedule 4.11 and marked with an asterisk,
together with all buildings, structures, fixtures and
improvements located thereon or relating thereto, owned or leased
by any member of the Del Monte Group.
"Stockholders Agreement" means the Stockholders
Agreement, dated as of January 9, 1990, among DMFC (formerly DMPF
Holdings Corp.) and the signatories thereto, as amended by
Amendment No. 1 thereto dated as of February 9, 1990, Amendment
No. 2 thereto dated as of June 11, 1990 and the Amendment and
Waiver of Stockholders Agreement dated as of January 9, 1997.
"Subsidiary", as it relates to any Person, means a
corporation of which such Person owns, directly or indirectly,
more than 50% of the common stock.
"Tax" and "Taxes" means (i) all taxes, assessments,
levies, imposts, duties, license fees, registration fees,
withholdings, or other similar governmental charges, including,
without limitation, income taxes, gross receipts, windfall
profits, severance, property, production use, license,
employment, payroll, goods and services and franchise taxes,
transfer taxes or fees, sales taxes, excise taxes, ad valorem
taxes, withholding taxes, minimum taxes and social security taxes
and (ii) any interest, penalties or additions to tax imposed on a
Tax described in clause (i) hereof, imposed by the United States,
or any state, county, local or foreign government or subdivision
or agency of any of the foregoing.
"Tax Returns" means all reports, estimates,
information statements and returns relating to or required to be
filed in connection with any Taxes (including any attached
schedules), including, without limitation, any claims or refunds,
amended returns and declarations of estimated Taxes pursuant to
the statutes, rules and regulations of any federal, state, local
or foreign government taxing authority.
"Term Loan Agreement" means the Term Loan and Security
Agreement dated as of June 15, 1995 among the Company, certain
financial institutions party thereto, and General Electric
Capital Corporation, as Agent, as amended on December 8, 1995,
December 15, 1995 and September 11, 1996.
"Trademarks" means (i) any and all trademarks, service
marks, certification marks, trade dress, assumed names and trade
names (in each case whether
registered or unregistered), and any applications and
registrations therefor, used or held by any member of the Del
Monte Group in connection with the Assets or Operations and (ii)
the goodwill of the Operations in connection with which such
marks, registrations or applications have been us
ARTICLE II
THE RECAPITALIZATION TRANSACTIONS
Upon the terms and subject to the conditions of this
Agreement, the parties hereto and other parties referred to
herein shall enter into the following transactions:
2.1 Amendment of DMFC's Articles of Incorporation and
the Stockholders Agreement. On or prior to the Closing Date, the
Articles of Incorporation of DMFC and the Stockholders Agreement
shall be amended in a manner consistent with, and to the extent
necessary to permit consummation of, the transactions
contemplated hereby.
2.2 Subscription of Sub Stock. At the Closing, Sub
shall issue (i) to Parent 98,347.62 shares of Sub Common Stock
for $99,347,618.13; (ii) to TPG Parallel, L.P. ("TPG Parallel")
9,900.74 shares of Sub Common Stock for $9,900,741.87; (iii) to
BankAmerica Investment Corporation ("BAIC") 4,500 shares of Sub
Common Stock for $4,500,000; (iv) to MIG Partners III ("MIG") 500
shares of Sub Common Stock for $500,000; (v) to BT Investment
Partners, Inc. ("BTIP") 5,000 shares of Sub Common Stock for
$5,000,000; (vi) to Westar Capital ("Westar") 5,000 shares of Sub
Common Stock for $5,000,000, all in accordance with the terms of
the Common Stock Subscription Agreement, dated as of April 18,
1997, among Sub, Parent, TPG Parallel, BAIC, MIG, BTIP and
Westar; and (vii) to TCW Capital Investment Corporation and/or
one or more of its Affiliates ("TCW") 1,500 shares of Sub Common
Stock for $1,500,000. At the Closing, Sub shall issue (x) to
Parent 15,914.045 shares and to TPG Parallel 1,585.955 shares of
Series A Redeemable Preferred Stock, $.01 par value per share, of
Sub ("Sub Series A Preferred Stock") for $15,914,045 and
$1,585,955, respectively, and (y) to TCW 17,500 shares of Series
B Redeemable Preferred Stock, $.01 par value per share, of Sub
("Sub Series B Preferred Stock"), all in accordance with the
terms of the Preferred Stock Subscription Agreement, dated as of
April 18, 1997, among Sub, Parent and TCW.
2.3 New Term Loan and New Revolving Credit. At the
Closing, the Company shall issue notes in the aggregate principal
amount of $380.0 million of New Term Loan Notes and advances of
$111 million under the New Revolving Credit Notes, pursuant to
the terms of the Senior Secured Credit Agreement, against payment
by the Senior Secured Lenders to the Company of the proceeds of
such New Term Loan and such New Revolving Credit.
2.4 The Senior Subordinated Notes. At the Closing,
pursuant to the terms of the Senior Subordinated Financing
Agreement, the Company shall issue one or more Senior
Subordinated Notes in an aggregate principal amount of $150
million, with net proceeds to the Company of approximately $146.9
million, which shall be privately placed by the Senior
Subordinated Placement Agents pursuant to Rule 144A of the
Securities Act, against payment to the Company of the proceeds
from the sale of the Senior Subordinated Notes.
2.5 The DMFC Dividend and Repayment of Existing
Indebtedness. Subject to the receipt of the proceeds pursuant to
the financing transactions set forth in Sections 2.3 and 2.4, on
the Closing Date, the Company shall declare and pay a dividend of
approximately $265 million to DMFC and shall pay in full all of
the Existing Debt, including the outstanding principal of,
accrued and unpaid interest on, any prepayment penalties or
premiums on, and any other amounts payable with respect to, the
Existing Debt, but not any undrawn principal amounts under
outstanding letters of credit (the aggregate amount of such
obligations, the "Debt Retirement Payment").
2.6 The Merger. At the Effective Time, subject to the
terms and conditions of this Agreement, Sub shall be merged with
and into DMFC in accordance with the laws of the State of
Maryland, with DMFC being the surviving corporation (sometimes
referred to hereinafter as the "Surviving Corporation"). The
Merger shall be effective when properly executed and acknowledged
Articles of Merger (together with any other documents required by
law to effectuate the Merger) shall be filed with and accepted
for recording by the Department, which filing shall be made
promptly following the consummation of transactions contemplated
by Sections 2.1, 2.2, 2.3, 2.4 and 2.5 of this Agreement.
2.7 Effect of the Merger. By virtue of the Merger, at
the Effective Time, the Surviving Corporation shall possess all
the rights, privileges, immunities, powers and purposes of Sub
and DMFC and shall by operation of law assume and be liable for
all the liabilities, obligations and penalties of Sub and DMFC.
2.8 Charter, By-laws, Directors and Officers of the Surviving
Corporation.
(a) From and after the Effective Time, the Charter of
Sub in effect immediately prior to the Effective Time shall be
the Charter of the Surviving Corporation, until altered, amended
or repealed in accordance with applicable law, except that, at
the Effective Time, Article I of such Charter shall be amended to
read as follows: "The name of the Corporation is Del Monte Foods
Company."
(b) From and after the Effective Time, the By-laws of
Sub in effect immediately prior to the Effective Time shall be
the By-laws of the Surviving Corporation until further altered,
amended or repealed in accordance with applicable law.
(c) From and after the Effective Time, the directors
of Sub immediately prior to the Effective Time shall be the
directors of the Surviving Corporation, and the officers of DMFC
immediately prior to the Effective Time shall be the officers of
the Surviving Corporation, to serve until such time as their
successors have been elected and have qualified in accordance
with the Charter and By-laws of the Surviving Corporation and
applicable law unless sooner removed, retired, disqualified or
deceased.
2.9 Conversion or Cancellation of DMFC Common Stock
and DMFC Preferred Stock. At the Effective Time, by virtue of the
Merger and without any action on the part of the holder thereof:
(a) Each share of DMFC Common Stock or DMFC Preferred
Stock (other than (i) shares of DMFC Common Stock or DMFC
Preferred Stock held by persons who have taken all steps
necessary to perfect their rights to an appraisal of the fair
value of such shares under Sections 3-202 et seq. of the MGCL
("Dissenting Shares") or (ii) Elected Shares (as defined below))
shall be cancelled and shall be converted into the right to
receive in cash the consideration applicable to such share in
accordance with Schedule 2.9(a) hereto, which schedule shall be
provided to Purchasers by DMFC within five business days after
the date of this Agreement. If, in accordance with Maryland law,
any holder of Dissenting Shares shall fail to perfect,
effectively withdraw or lose his right to payment of the fair
value for his shares of DMFC Common Stock or DMFC Preferred
Stock, each such share shall thereupon be deemed to have been
converted into and to have become exchangeable for, as of the
Effective Time, the right to receive in cash the consideration
applicable to such share in accordance with Schedule 2.9(a).
(b) At the election of the holder thereof in
accordance with this Section 2.9(b), each share of Series F
Preferred Stock held by such holder (an "Electing Shareholder")
shall be converted into a number of shares of common stock, par
value $0.01 per share, of the Surviving Corporation ("Surviving
Corporation Common Stock") determined in the manner set forth in
Schedule 2.9(b) hereto (the "Series F Share Consideration"), in
lieu of the cash consideration provided for in Section 2.9(a) of
this Agreement. In order to elect to receive the Series F Share
Consideration in lieu of cash consideration, an Electing
Shareholder must furnish to the Secretary of DMFC, on or before
the fifth business day immediately preceding the Closing Date,
written notice to DMFC and each of the Purchasers effectively (i)
waiving any right of such Electing Shareholder to receive the
cash consideration provided for in Section 2.9(a) of this
Agreement with respect to, and (ii) electing to receive the
Series F Share Consideration in exchange for, in each case, all
or a portion of such Electing Shareholder's shares of Series F
Preferred Stock. For purposes of this Agreement, shares of Series
F Preferred Stock with respect to which an election to receive
the Series F Share Consideration is made shall be referred to as
"Elected Shares."
(c) The holders of shares of DMFC Common Stock and
DMFC Preferred Stock shall cease to have any rights as
stockholders of DMFC, including any right to receive dividends,
whether or not previously declared and unpaid, (except such
rights, if any, as they may have pursuant to Section 3-202 of the
MGCL) and their sole right shall be the right to receive, as the
case may be, (i) the cash into which their shares of DMFC Common
Stock or DMFC Preferred Stock have been converted by the Merger
as provided in Section 2.9(a) or (ii) in the case of Elected
Shares, the Surviving Corporation Common Stock into which such
Elected Shares shall have been converted in the Merger pursuant
to Section 2.9(b) of this Agreement.
(d) Each share of Sub Common Stock issued and
outstanding immediately prior to the Effective Time shall be
converted into one share of Surviving Corporation Common Stock.
(e) Each share of Sub Series A Preferred Stock issued
and outstanding immediately prior to the Effective Time shall be
converted into one share of Series A Redeemable Preferred Stock
of the Surviving Corporation ("Surviving Corporation Series A
Preferred Stock"). Each share of Sub Series B Preferred Stock
issued and outstanding immediately prior to the Effective Time
shall be converted into one share of Series B Redeemable
Preferred Stock of the Surviving Corporation ("Surviving
Corporation Series B Preferred Stock"). The terms of the
Surviving Corporation Series A Preferred Stock and the Surviving
Corporation Series B Preferred Stock shall be substantially the
same as the terms of the Sub Series A Preferred Stock and Sub
Series B Preferred Stock, respectively.
2.10 Surrender of DMFC Share Certificates; Payment for DMFC
Common Stock and DMFC Preferred Stock.
(a) Prior to the Closing, Sub shall select a bank or
other financial institution acceptable to DMFC to serve as the
Paying Agent (the "Paying Agent").
(b) At the Closing, immediately after the Effective
Time, Purchasers shall cause payments to be made to such Persons
who are identified on Schedule 2.10(b) to be provided by DMFC to
Purchasers no later than five days before the Closing and who
have surrendered to Sub one or more certificates which,
immediately prior to the Effective Time, represent shares of DMFC
Common Stock or DMFC Preferred Stock ("DMFC Share Certificates"),
together with a duly executed letter of transmittal in form
reasonably acceptable to Purchasers and the Company, of the
amount of cash into
which the shares of DMFC Common Stock or DMFC Preferred Stock
theretofore represented by the DMFC Share Certificate so
surrendered by such Person shall have been converted pursuant to
the provisions of this Article II and the DMFC Share Certificate
so surrendered shall forthwith be canceled. No interest will be
paid or accrued on the cash payable on the surrender of the DMFC
Share Certificates. At the Closing, Purchasers shall deliver to
the Paying Agent, for the benefit of the holders of DMFC Common
Stock and DMFC Preferred Stock (other than Electing Shareholders)
not listed on Schedule 2.10(b) and Persons who are identified on
Schedule 2.10(b) who have not delivered DMFC Share Certificates
or the required letter of transmittal, funds in the aggregate
amount into which such shares of DMFC Common Stock or DMFC
Preferred Stock shall have been converted pursuant to the
provisions of this Article II. The total amount paid by
Purchasers under this Section 2.10(b) shall be, and shall not in
any event exceed, the Purchase Price.
(c) Within 10 business days after the Effective Time,
the Surviving Corporation shall mail to each holder of record
(other than Sub, any Affiliate of Sub, or any Subsidiary of DMFC
or the Company) of DMFC Share Certificates not surrendered
pursuant to subsection (b) above, (i) a letter of transmittal in
form reasonably acceptable to Purchasers and the Company, and
(ii) instructions for effecting the surrender of DMFC Share
Certificates for payment therefor. Within three days following
surrender of a DMFC Share Certificate for cancellation to the
Surviving Corporation, together with such letter of transmittal,
duly executed, the Paying Agent shall remit to the holder of such
DMFC Share Certificate the amount of cash into which the shares
of DMFC Common Stock or DMFC Preferred Stock theretofore
represented by the DMFC Share Certificate so surrendered shall
have been converted pursuant to the provisions of this Article II
and the DMFC Share Certificate so surrendered shall forthwith be
canceled. No interest will be paid or accrued on the cash payable
on the surrender of the DMFC Share Certificates.
(d) In the event that any DMFC Share Certificate shall
have been lost, stolen or destroyed, upon the making of an
affidavit of that fact by the Person claiming such DMFC Share
Certificate to be lost, stolen or destroyed, the Surviving
Corporation will pay in exchange for such lost, stolen or
destroyed DMFC Share Certificate the cash payable in respect
thereof as determined in accordance with this Article II, except
that when authorizing such payment, the Board of Directors or a
duly authorized officer of the Surviving Corporation may, in its
discretion and as a condition to such payment, require the owner
of such DMFC Share Certificate to give the Surviving Corporation
an indemnity, in form and substance reasonably satisfactory to
the Surviving Corporation, against any loss or claim arising as a
result of the issuance of a new certificate.
(e) All unclaimed cash held by the Paying Agent on the
first anniversary of the Effective Time shall be returned by it
to the Surviving Corporation,
and thereafter any DMFC Share Certificates not yet
surrendered shall be surrendered to, and payment therefor
delivered by, the Surviving Corporation.
(f) After the Effective Time, there shall be no
further registration of transfers on the stock ledger of the
Surviving Corporation of the shares of DMFC Common Stock or DMFC
Preferred Stock which were outstanding immediately prior to the
Effective Time. If, after the Effective Time, DMFC Share
Certificates representing such shares are presented to the
Surviving Corporation, they shall be canceled and exchanged for
such consideration as provided in this Article II.
(g) The parties to this Agreement acknowledge that
Purchasers, Del Monte and certain stockholders of DMFC have
entered into an agreement dated April 14, 1997 (the "Escrow
Agreement"), pursuant to which $7,681,568.98 of the Purchase
Price (the "Escrow Amount") will be deposited by DMFC into escrow
and that the Escrow Amount will be distributed pursuant to the
terms of the Escrow Agreement.
ARTICLE III
CLOSING OF TRANSACTIONS
The closing of the transactions provided for in this
Agreement (the "Closing") shall be held at the offices of
Proskauer Xxxx Xxxxx & Xxxxxxxxxx LLP, 0000 Xxxxxxxx, Xxx Xxxx,
Xxx Xxxx, (x) at 10:00 A.M. on the fifth business day after the
conditions specified in Sections 9.1(d) and (e) and 9.2(d) and
(e) have been satisfied or (y) at such other time and date after
each of the conditions set forth in Article IX of this Agreement
shall have been fulfilled or waived in accordance herewith as the
parties hereto may designate by mutual consent. The date on which
the Closing occurs is hereinafter referred to as the "Closing
Date." At the Closing: (i) the parties shall exchange the
documents referred to in Article IX; (ii) Sub shall make the
payments of cash to the holders of DMFC Common Stock and DMFC
Preferred Stock listed on Schedule 2.10(b) and to the Paying
Agent, on behalf of all other holders of DMFC Common Stock and
DMFC Preferred Stock (other than Electing Shareholders) required
by Section 2.10(b), by wire transfer of immediately available
funds; and (iii) Purchasers shall cause the Articles of Merger to
be filed for record with the Department.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF DMFC
DMFC hereby represents and warrants to Purchasers
that:
4.1 Organization. Each of DMFC and the Company is a
corporation duly organized, validly existing and in good standing
under the laws of its jurisdiction of incorporation. Each
Subsidiary of the Company is a corporation duly organized,
validly existing and in good standing, except as would not,
individually or in the aggregate, have a Material Adverse Effect.
Each of DMFC, the Company and each of the Company's Subsidiaries
has full corporate power and authority to own or lease and
operate its Properties and to conduct its business as currently
conducted, except as would not, individually or in the aggregate,
have a Material Adverse Effect. Each of DMFC, the Company and
each of the Company's Subsidiaries is duly licensed or qualified
and in good standing in all jurisdictions in which the character
of the Properties owned or leased by it or the nature of its
business requires it to be so licensed or qualified except where
the failure to be so licensed, qualified or in good standing
would not, individually or in the aggregate, have a Material
Adverse Effect. Attached hereto as Schedule 4.1 is a list, true
and complete in all material respects, of each Subsidiary of the
Company indicating its jurisdiction of incorporation and the
nature and level of ownership in such Subsidiary by the Company.
The Company is the sole direct subsidiary of DMFC. Copies, true
and complete in all material respects, of the Charter and By-laws
and other governing documents of DMFC and the Company have
previously been made available to Purchasers.
4.2 Authority; Enforceability. DMFC has the corporate
power and authority to enter into this Agreement and to carry out
its obligations hereunder. The execution and delivery of this
Agreement and the consummation of the transactions provided for
hereby have been duly authorized by the Board of Directors of
DMFC, and no other corporate approval on the part of DMFC is
necessary to authorize the execution or delivery of this
Agreement or the consummation of any of the transactions
contemplated hereby, except for the approval of the Merger by the
stockholders of DMFC. This Agreement has been duly executed and
delivered by DMFC and, subject only to the approval of the Merger
by the stockholders of DMFC (and assuming due authorization,
execution and delivery by the Purchasers), constitutes a legal,
valid and binding obligation of DMFC, enforceable against DMFC in
accordance with its terms, except as enforcement thereof may be
limited by bankruptcy, insolvency (including, without limitation,
all laws relating to fraudulent transfers), reorganization,
moratorium or similar laws affecting creditors' rights generally
and except as enforcement thereof is subject to general
principles of equity (regardless of whether considered in a
proceeding in equity or at law).
4.3 Capitalization.
(a) As of the date hereof, the entire authorized
capital stock of DMFC consists of (i) 16,523,000 shares of Series
A Preferred Stock, of which 8,858,349 shares are outstanding,
(ii) 3,616,000 shares of Series B Preferred Stock, of which
1,730,206 shares are outstanding, (iii) 2,900,000 shares of
Series C Preferred Stock, of which 1,522,353
shares are outstanding, (iv) 1,554,000 shares of Series D
Preferred Stock, of which 1,466,582 shares are outstanding, (v)
5,000,000 shares of Series E Preferred Stock, of which 3,596,867
shares are outstanding, (vi) 2,900,000 shares of Series F
Preferred Stock, of which 1,153,091 are outstanding, (vii)
1,000,000 shares of Class A Common Stock, of which 198,468 shares
are outstanding, (viii) 150,000 shares of Class B Common Stock,
none of which is outstanding, (ix) 550,000 shares of Class C
Common Stock, of which 6,903 shares are outstanding, (x) 550,000
shares of Class D Common Stock, of which 102,483 shares are
outstanding, (xi) 550,000 shares of Class E Common Stock of which
25,000 shares are outstanding and (xii) 550,000 shares of Class F
Common Stock of which 50,000 shares are outstanding. All of such
outstanding shares have been duly authorized and validly issued
and are fully paid and nonassessable. Schedule 4.3(a) sets forth
the issued and outstanding shares of the capital stock of DMFC,
the names of the holders of record of such shares, the
liquidation value as of January 31, 1997 of each class of DMFC
Preferred Stock and the dividends in arrears as of such date in
respect of each class of DMFC Preferred Stock.
(b) The entire authorized capital stock of the Company
consists of 2,000 shares of common stock, par value $1.00 per
share, of which 100 shares are outstanding and no shares are held
in treasury. All of such outstanding shares have been duly
authorized and validly issued and are fully paid and
nonassessable and are owned by DMFC, free and clear of all Liens
other than as set forth in Schedule 4.3(b).
(c) Other than as set forth in the Charter of DMFC or
the Stockholders Agreement, there are not authorized or
outstanding any subscriptions, options, conversion rights,
warrants or other agreements, securities or commitments of any
nature whatsoever obligating any member of the Del Monte Group to
issue, deliver, sell or acquire or cause to be issued, delivered,
sold or acquired, any shares of the capital stock, or any
securities convertible into or exchangeable for shares of capital
stock, of any of them or obligating any of them to grant, extend
or enter into any such agreement or commitment, and there are no
other obligations of any kind which would require any Person to
sell, pledge, transfer or register any shares of capital stock of
DMFC.
(d) All of the outstanding shares of capital stock of
each Subsidiary of the Company have been validly issued and are
fully paid and nonassessable, and all of such outstanding shares
will, at the Closing, be owned by the Company, free and clear of
all Liens. Except as set forth in Schedules 4.1 and 4.3(b),
neither DMFC, the Company nor any of its Subsidiaries, directly
or indirectly, owns any interest in any other Person other than a
Subsidiary.
(e) As of the fiscal January close (January 26, 1997),
there was an aggregate of $210.5 million of Existing Senior Debt,
comprised of $115.9 million under the Term Loan Agreement and
$94.6 million under the Revolving Credit Agreement, and an
aggregate accreted face amount (including accrued interest) of
$153.6 million of
PIK Notes and the Accounts Payable-Trade as of that date
were $62.4 million, all as reflected on the January Balance
Sheet.
4.4 No Breach. Except as set forth on Schedule 4.4 or
as would not impair the ability of DMFC to consummate the Merger,
and would not have a Material Adverse Effect, each of the
execution, delivery and performance of this Agreement and the
consummation of the transactions contemplated hereby does not and
will not (i) conflict with or violate any provision of the
Charter, By-laws or any other governing document of any member of
the Del Monte Group, (ii) violate, conflict with or result in the
breach or termination of, or otherwise give any other Person the
right to accelerate, terminate or receive any payment, or
constitute a default, event of default or an event which with
notice, lapse of time, or both, would constitute a default or
event of default, under the terms of, any Permit or Contract to
which any member of the Del Monte Group (other than a Subsidiary
of the Company) is a party or by which any of them or their
respective Assets are bound, (iii) result in the creation of any
Liens upon any of their respective Assets or (iv) constitute a
violation by any member of the Del Monte Group of any Legal
Requirement.
4.5 Financial Statements; Certain Actions.
(a) DMFC has provided to Purchasers copies of the
Financial Statements. The Financial Statements have been prepared
in accordance with GAAP, consistently applied and followed
throughout the periods indicated (except as noted thereon), and
present fairly, in all material respects, the consolidated
financial position of DMFC as of December 31, 1996, and as of
June 30, 1996, June 30, 1995 and June 30, 1994, and the
consolidated results of operations of DMFC for the six-month
period or the fiscal years then ended.
(b) As of June 30, 1996 and December 31, 1996, no member
of the Del Monte Group had any material liabilities or obligations
of any nature, whether accrued, absolute, contingent or
otherwise, whether due or to become due, which were required by
GAAP to be reflected in the audited consolidated balance sheet of
DMFC as of June 30, 1996 (the "June 30, 1996 Balance Sheet") or
the unaudited consolidated balance sheet of DMFC as of December
31, 1996 (the "December 31, 1996 Balance Sheet"), respectively,
of DMFC (collectively, "Liabilities" and individually, a
"Liability"), that were not so reflected or reserved against in
the June 30, 1996 Balance Sheet or the December 31, 1996 Balance
Sheet, respectively, or specifically disclosed or provided for in
the respective notes thereto. Except as set forth in Schedule
4.5, no member of the Del Monte Group has incurred any
Liabilities since December 31, 1996 except Liabilities incurred
in the usual and ordinary course of business consistent with past
practice or in connection with the performance of this Agreement
or that would not have a Material Adverse Effect.
(c) Except as set forth on Schedule 4.5, since
December 31, 1996, DMFC, the Company and its Subsidiaries have
not:
(i) through the date hereof, suffered any event
or condition which had a Material Adverse Effect;
(ii) split, combined or reclassified its
outstanding capital stock or declared, set aside, made
or paid any dividend or other distribution in respect
of the capital stock of any member of the Del Monte
Group (in cash or otherwise), except dividends in kind
in respect of the Preferred Stock;
(iii) other than in the ordinary course of
business, (A) incurred any indebtedness for borrowed
money or varied the material terms of any existing
debt securities, or (B) issued, sold or transferred,
or agreed to issue, sell or transfer, any stock, bond,
debenture or other security of any member of the Del
Monte Group or any debt securities;
(iv) sold, mortgaged, pledged, subjected to any
Lien or otherwise disposed of any material Assets or
properties, except for the sale of inventory and
disposition of obsolete equipment in the ordinary
course of business;
(v) taken any other action that, if it occurred
after the date of this Agreement and prior to the
Closing Date, would be prohibited by Section 6.1; or
(vi) authorized or proposed, or agreed to take,
any of the actions set forth in the foregoing
subparagraphs (i) through (v).
4.6 Consents. No consent, waiver, approval,
authorization, exemption, registration, license or declaration
("Consent") of or by, or filing with, any Governmental Authority
is required to be made or obtained by DMFC or any other member of
the Del Monte Group in connection with (i) the execution,
delivery and performance of this Agreement or (ii) the
consummation of the Merger, other than (a) those the failure of
which to be made or obtained, individually or in the aggregate,
would not have a Material Adverse Effect, (b) those set forth in
Schedule 4.6 and (c) Consents and filings under the HSR Act and
the MGCL.
4.7 Actions and Proceedings. Except as set forth in
Schedule 4.7, there is no action, suit or legal, administrative,
arbitration or other alternative dispute resolution proceeding or
investigation (each, a "Proceeding" and collectively,
"Proceedings") (in each case, whether or not the defense thereof
or Liability in respect
thereof is covered by policies of insurance) pending (to
DMFC's Knowledge in the case of any such investigation) or, to
DMFC's Knowledge, threatened, nor any Judgment (which has not
been discharged), against any member of the Del Monte Group nor
any mandatory or voluntary recall of products or stock rotation
by any member of the Del Monte Group pending or, to DMFC's
Knowledge, threatened, that, if adversely determined, would
result in a Liability for any member of the Del Monte Group in
excess of $1,000,000 or otherwise, either individually or in the
aggregate, would have a Material Adverse Effect. Schedule 4.7
also sets forth a description of each and every currently
outstanding material written claim known to any member of the Del
Monte Group, including the amount thereof, against any member of
the Del Monte Group for indemnification pursuant to any agreement
relating to the purchase or sale of stock or assets by such
member of the Del Monte Group. As of the date of this Agreement,
no Proceeding is pending (to DMFC's Knowledge in the case of any
such investigation) or, to DMFC's Knowledge, threatened in
writing against DMFC or any other member of the Del Monte Group
before any Governmental Authority to restrain or prohibit, or to
obtain damages, a discovery order or other relief in connection
with this Agreement or any of the transactions contemplated
hereby.
4.8 Brokers. No member of the Del Monte Group nor
anyone acting on behalf of any member of the Del Monte Group has
employed any broker or finder or incurred any liability for any
brokerage fees, commissions or finders fees or other similar
compensation in connection with the Merger and the transactions
contemplated by this Agreement, other than DMFC's engagement of
Xxxxxx Xxxxxxx as exclusive agent for DMFC to attempt to arrange
the disposition of all or a portion of the Operations. DMFC has
provided to Purchasers a true and complete copy of the agreement
between DMFC and Xxxxxx Xxxxxxx with respect to such engagement.
4.9 Taxes and Tax Returns.
(a) Except as set forth on Schedule 4.9, all material
Tax Returns of all income and franchise Taxes, including, without
limitation, consolidated federal income Tax Returns, of the
Seller's Group and all other material Tax Returns required to be
filed on or before the date hereof with respect to DMFC and its
Subsidiaries or any of their income, properties or operations,
have been duly filed in a timely manner (taking into account all
extensions of due dates). For purposes of the preceding sentence,
the materiality of a Tax Return shall be judged with respect to
the Del Monte Group. All material Taxes attributable to DMFC and
its Subsidiaries that are or were due and payable as of the date
hereof (without regard to whether such Taxes have been assessed),
have been paid.
(b) Except as set forth on Schedule 4.9, the
consolidated federal income tax returns of the Seller's Group
(exclusive of any Seller's Group that included Xxxxxxx, Xxxxx & Co.
or an affiliate (other than DMFC or its subsidiaries)) are closed to
assessment, for all years through September 30, 1992. Except
as set forth on Schedule 4.9, there is no claim or assessment
pending, or, to DMFC's Knowledge, threatened against any member
of the Del Monte Group for any alleged deficiency in Taxes, and
neither DMFC, the Company nor any Subsidiary of the Company knows
of any audit or investigation with respect to any Liability of
any member of the Del Monte Group for Taxes. Except as set forth
on Schedule 4.9, no deficiencies for any material Taxes have been
proposed, asserted or assessed against DMFC or any of its
Subsidiaries. Except as set forth on Schedule 4.9, there are no
agreements in effect to extend the period of limitations for the
assessment or collection of any material Tax of DMFC or any of
its Subsidiaries.
(c) To DMFC's knowledge, no consent has been filed
relating to the Company or any of its Subsidiaries pursuant to
Section 341(f) of the Code.
(d) Except as provided on Schedule 4.9, DMFC and each
of its Subsidiaries has in all material respects satisfied
(including through timely payment to the appropriate taxing
authority) all applicable material federal, state, foreign and
local withholding Tax and information reporting requirements
(including, without limitation, income, social security and
employment Tax withholding for all types of compensation) and has
furnished or made available to the Purchasers complete and
accurate copies of all federal income Tax Returns, and all
material state and local income and franchise Tax Returns, and
any amendments thereto, filed by such member for tax years ending
September 30, 1993, 1994 and 1995.
(e) DMFC is not a United States real property holding
corporation within the meaning of section 897(c)(2) of the Code.
(f) The reported net operating losses and foreign tax
credits for federal income tax purposes of DMFC and its
Subsidiaries are not subject to limitation on their use under
Sections 382 or 383 of the Code, or the rules relating to
"separate return limitation years" (excluding any effect of the
transactions contemplated by this Agreement).
(g) Except as set forth on Schedule 4.9, there is no
contract, agreement or intercompany account system in existence
under which DMFC, the Company or any Subsidiary of the Company
has, or may at any time in the future have, an obligation to
contribute to the payment of any portion of a Tax (or pay any
amount calculated with reference to any portion of a Tax)
determined on a consolidated, combined or unitary basis with
respect to an affiliated group (as defined in Section 1504 of the
Code) or with respect to any other group of corporations of which
DMFC, the Company or any Subsidiary of the Company is or was a
part.
(h) The representations made in subsections (a), (b),
(c), (e) and (g), insofar as they relate to Taxes attributable to
periods including January 10, 1990, or any earlier dates are made
to DMFC's Knowledge.
4.10 Title to Property; Sufficiency.
(a) Each member of the Del Monte Group has (i) with
respect to the Specified Real Estate which is owned by it, good
and marketable fee simple title and, with respect to the
Specified Real Estate which is leased by it, valid and subsisting
leasehold estates, in each instance free and clear of all Liens
other than Permitted Encumbrances and (ii) with respect to the
owned or leased Assets (other than the Specified Real Estate and
Intellectual Property Rights), good title or valid leasehold
interests, free and clear of all Liens other than Permitted
Encumbrances. The Permitted Encumbrances (other than those on
Schedule 4.10) do not and will not materially adversely affect or
interfere with the occupancy, value or current use or operations
of the Specified Real Estate nor could such Permitted
Encumbrances have a material adverse effect thereon.
(b) The Assets (other than Intellectual Property
Rights) include all Properties (other than Intellectual Property
Rights) necessary for the conduct of the Operations, as they are
currently being conducted, except where the failure to include
any such Properties would not have a Material Adverse Effect.
4.11 Real Property.
(a) Schedule 4.11 sets forth a list of all fee and
leasehold interests in real property of DMFC, the Company and the
Subsidiaries of the Company.
(b) No member of the Del Monte Group has given or
received notice of any material default under any lease of
Specified Real Estate under which any member of the Del Monte
Group is the lessee of real property (each a "Lease" and
collectively the "Leases") and, to DMFC's Knowledge, no member of
the Del Monte Group or any other party thereto is in default in
any material respect under any of the Leases. Schedule 4.11
contains a complete list of all Leases relating to the Specified
Real Estate (including all amendments, modifications, waivers,
supplements and other agreements relating thereto). Except as set
forth on Schedule 4.11, none of the Leases has been modified in
any material respect and such Leases are in full force and
effect. Except as set forth in Schedule 4.11, no member of the
Del Monte Group has leased, subleased, licensed or assigned, as
the case may be, all or any portion of its fee or leasehold
interest in any Specified Real Estate to any Person and a member
of the Del Monte Group is in sole and exclusive possession of and
has the right to use all of the Specified Real Estate. Except as
set forth on Schedule 4.5, no Person other than the Del Monte
Group has any option or right to purchase, lease or use any
portion of the
Specified Real Estate. Schedule 4.11 sets forth
all rights of the Del Monte Group to purchase the Specified Real
Estate leased by the Del Monte Group under any Lease.
(c) Except as disclosed in Schedule 4.13, the
buildings and improvements on the Specified Real Estate
(including all fixtures, roofs, plumbing systems, HVAC systems,
fire protection systems, electrical systems, equipment, elevators
and all structural components) are in all material respects in
good operating condition and in a state of good and working
maintenance and repair, ordinary wear and tear excepted, are
adequate and suitable for the purposes for which they are
presently being used and, to DMFC's Knowledge, there are no
condemnation or appropriation proceedings pending or threatened
against any of such Specified Real Estate or the improvements
thereon, and no buildings or improvements on such real property
encroach on real property not leased to or owned by a member of
the Del Monte Group, to the extent that removal of such
encroachment would have a material adverse effect on the current
use, value, occupancy or operation of such improvements. No
improvements or buildings not located on Specified Real Estate
encroach upon any of the Specified Real Estate to the extent that
the same would have a material adverse effect on the current use,
value, occupancy or operation of such Specified Real Estate.
(d) To DMFC's Knowledge, no part of any Specified Real
Estate is subject to any building or use restriction that would
materially restrict or prevent the present use and operation of
such property. To DMFC's Knowledge, none of the Specified Real
Estate nor the use thereof by the Del Monte Group constitutes a
nonconforming use or legal non-conforming use.
(e) The Del Monte Group is in possession of and has
good title to, or has valid leasehold interests in or valid
rights under contract to use, all tangible personal property used
in the business of the Del Monte Group or reflected in the
December 31, 1996 Balance Sheet. All such tangible personal
property is owned by a member of the Del Monte Group free and
clear of all Liens other than Permitted Encumbrances, or is
leased under a valid and subsisting lease, and is in all material
respects in good working order and condition, ordinary wear and
tear excepted.
(f) No labor has been performed or material furnished
for any portion of any property owned by any member of the Del
Monte Group for which a Lien in excess of $500,000 in value can
be claimed against any such property. All of the Specified Real
Estate has rights of access to dedicated public ways (and makes
no material use of any means of access or egress that is not
pursuant to such dedicated public ways or recorded, irrevocable
rights-of-way) and is served by water, sewer, sanitary sewer,
telephone, electric, gas and other public utilities necessary or
desirable for the current use thereof which utilities are
available to such Specified Real Estate through a public
right-of-way. There are no pending or proposed special or other
assessments for public improvements on the Specified Real Estate.
(g) To DMFC's Knowledge, there is no pending or threatened
Proceeding or governmental action to modify the zoning classification of, or to
(g) To DMFC's Knowledge, there is no pending or
threatened Proceeding or governmental action to modify the zoning
classification of, or to condemn or take by power of eminent
domain (or any purchase in lieu thereof), or to classify as a
landmark, all or any material part of the Specified Real Estate
except, in each case, for any Proceeding or action that would not
have a Material Adverse Effect.
4.12 Intellectual Property.
(a) Schedule 4.12(a) sets forth an accurate and
complete list of all material United States Intellectual Property
Rights, indicating for each material Trademark and material
patent (i) whether such Trademark or patent is owned by DMFC, the
Company or a Subsidiary thereof, and including the jurisdictions
in which each such Trademark or patent has been issued or
registered or in which any application for issuance or
registration has been made (including the official number or
other identifier of such issuance, registration or application
therefor), (ii) whether such Trademark or patent is owned by or
licensed or sub-licensed from a third party and (iii) whether
such Trademark or patent is licensed by DMFC, the Company or any
Subsidiary thereof or, to DMFC's Knowledge, sub-licensed to any
third party. Except as set forth in Schedule 4.12(a), all
Trademarks which are listed in Schedule 4.12(a) have been duly
registered with, filed in or issued by or an application is
pending in the United States Patent and Trademark Office or
proper non-U.S. Government office for such registrations, and
such registrations have been properly maintained and renewed in
accordance with all Legal Requirements and are currently valid
and in full force and effect except, in each case, where failure
to so register, apply, maintain, renew or be valid would not have
a Material Adverse Effect. Each member of the Del Monte Group has
taken all reasonable and appropriate steps to protect the
material United States Intellectual Property Rights and to
preserve in all material respects the confidentiality of all
trade secrets, proprietary know-how and proprietary information
included in such material United States Intellectual Property
Rights. To DMFC's Knowledge, all use by and disclosure of trade
secrets and other proprietary and confidential information that
comprises any material part of the material United States
Intellectual Property Rights to any other person has been
pursuant to the terms of a written agreement with such person,
and all use by the Del Monte Group of trade secrets and other
proprietary and confidential information that is owned by another
person has been pursuant to the terms of a written agreement with
such person or is otherwise lawful. Except as set forth in
Schedule 4.12(a) or as would not have a Material Adverse Effect,
no member of the Del Monte Group has been notified in writing of
any adverse claims or demands of any Person pertaining to, or
challenges to the scope or viability of, any of the material
United States Intellectual Property Rights listed in Schedule 4.12(a).
There does not exist (i) any unexpired patent which covers (x) any
part of the Operations, (y) any product of the Operations or
(z) any apparatus, method or process or design used or held in
the Operations, unless such patent is owned by or licensed to
a member of the Del Monte Group, (ii) any Trademark or
copyright used in the Operations, unless it is owned by or
licensed to a member of the Del Monte Group or (iii) any
technology, proprietary design, know-how, process or trade secret
used or held in the Operations, unless it is owned by or licensed
to the Company or any of its Subsidiaries, except in each case
where the existence thereof would not have a Material Adverse
Effect. Except as set forth in Schedule 4.12(a), the Company or a
Subsidiary has the sole and exclusive right to use the
Intellectual Property Rights required for the conduct of the
Operations, in the jurisdictions in which it conducts its
business or where the products of its business are distributed,
and the consummation of the transactions contemplated hereby will
not materially alter or impair any such rights, except in each
case where failure to have such right would not have a Material
Adverse Effect. Except as would not have a Material Adverse
Effect, (i) there has been no registration for any Intellectual
Property Rights lost due to inactivity or abandoned since January
1, 1993 and no (ii) such registration is subject to lapsing due
to inactivity within six months following the date of this
Agreement, except as set forth in Schedule 4.12(a). Schedule
4.12(a) also sets forth all other material Intellectual Property
Rights licensed or sub-licensed from or to any third party.
(b) Except as set forth on Schedule 4.12(b), to DMFC's
Knowledge, the use or other exploitation of the Intellectual
Property Rights by the Del Monte Group does not infringe on the
rights of any other Person, except where any loss or liability
resulting from such infringement would not have a Material
Adverse Effect. Except as set forth on Schedule 4.12(b), to the
DMFC's Knowledge, no other Person is infringing on the rights of
the Company or any of its Subsidiaries in the United States with
respect to the Intellectual Property Rights, except where any
loss or liability resulting from such infringement would not have
a Material Adverse Effect.
(c) The validity of the United States Intellectual
Property Rights owned or licensed by the Del Monte Group is not
being challenged in any actual, or to DMFC's Knowledge,
threatened Proceeding in which an adverse outcome would have a
Material Adverse Effect.
(d) Except as set forth on Schedule 4.7, no member of
the Del Monte Group is a party to, subject to or bound by any
Judgment or Legal Requirement that would prevent the transfer by
such member of the Del Monte Group of any Intellectual Property
Rights.
(e) In the case of Trademarks and patents owned by a
member of the Del Monte Group, except as disclosed on Schedules
4.12(b) and 4.15, such member has good title to such Trademark
and patent, free and clear of all Liens other than Permitted
Encumbrances, and has the right to sell, transfer, assign and
license all right, title and interest in and to such patent and
Trademark rights.
(f) In the case of Trademarks or patents held pursuant
to a license or licensed to third parties, each such license is in
full force and effect and constitutes a legal, valid and binding
agreement, enforceable in accordance with its terms, of the
Company or a Subsidiary thereof and, to DMFC's Knowledge, each
other party thereto.
4.13 Compliance with Legal Requirements.
(a) Except as set forth on Schedule 4.13(a) or as
would not have a Material Adverse Effect, each member of the Del
Monte Group and all of the Specified Real Estate (including the
use thereof) is, and since January 1, 1993 has been, in
compliance in all respects with all Legal Requirements, including
under the Federal Food, Drug and Cosmetic Act, as amended, and
other statutes, rules and regulations administered by the United
States Federal Food and Drug Administration. To DMFC's Knowledge,
except as set forth in Schedule 4.13(a) or as would not have a
Material Adverse Effect, no member of the Del Monte Group has any
continuing Liability resulting from (A) any citations, notices of
violations, written complaints, consent orders (or amendments to
or modifications of such orders), compliance schedules or other
similar enforcement orders received from any Governmental
Authority since January 1, 1993 with respect to Legal
Requirements, or (B) any notice, including inspection reports,
received from any Governmental Authority since January 1, 1993
which in any case would indicate that there was not then or is
not currently compliance with all such Legal Requirements.
(b) Except as set forth in Schedule 4.13(b) or for
Permits the lack of which, individually or in the aggregate,
would not have a Material Adverse Effect, each member of the Del
Monte Group and all of the Specified Real Estate (including the
use thereof) has, and upon consummation of the Merger, will
continue to have all Permits necessary to own, use and maintain
the Assets as they are currently being used, and to conduct the
Operations as they are currently being conducted. Except as set
forth on Schedule 4.13(b) or as would not have a Material Adverse
Effect, (i) all Permits of the Del Monte Group are in full force
and effect, (ii) any applications for renewal of any
Permit due prior to Closing have been, or will be, timely filed
prior to Closing, (iii) no Proceeding (to DMFC's Knowledge in the
case of any investigation) to modify, suspend, revoke, withdraw,
terminate or otherwise limit any such Permit is pending or, to
DMFC's Knowledge, threatened and (iv) neither DMFC nor the
Company has received notification that any administrative or
governmental actions have been taken nor, to DMFC's Knowledge,
are any such actions threatened in connection with the
expiration, continuance or renewal of such Permits which could
affect the ability of the Company or any of its Subsidiaries to
own any Assets, to operate, use or maintain any Assets or to
conduct any of the Operations in substantially the same manner in
which such Operations are conducted currently.
4.14 Environmental.
(a) Except as set forth on Schedule 4.14, to DMFC's
Knowledge, all of the operations of DMFC, the Company and its
Subsidiaries at or from any real property owned or leased by them
(the "Real Property") comply with applicable Environmental Laws
except as would not have a Material Adverse Effect. Except as set
forth on Schedule 4.14, to DMFC's Knowledge, neither DMFC, the
Company or any of its Subsidiaries, nor any other person acting
on behalf of any of them, has engaged in or permitted any
operations or activities upon any of the Real Property for the
purpose of or involving the treatment, storage, use, generation,
release, discharge, emission, or disposal of any Hazardous
Substances at the Real Property, except as would not have a
Material Adverse Effect. As used in this Agreement, (i)
"Environment" means any surface or subsurface physical medium or
natural resource, including, air, land, soil (surface or
subsurface), surface waters, ground waters, wetlands, stream and
river sediments, rock and biota, (ii) "Environmental Laws" means
any federal, state or local law, legislation, rule, regulation,
ordinance or code relating to the injury to, or the pollution or
protection of, human health and safety or the Environment, and
(iii) "Hazardous Substances" means petroleum, petroleum products,
petroleum-derived substances, radioactive materials, hazardous
wastes, polychlorinated biphenyls, lead based paint, urea
formaldehyde, asbestos or any materials containing asbestos, and
any materials or substances regulated or defined as or included
in the definition of "hazardous substances," "hazardous
materials," "toxic substances," "pollutants," "contaminants" or
any similar denomination intended to classify substances by
reason of toxicity, carcinogenicity, ignitability, corrosivity or
reactivity under any Environmental Laws.
(b) Except as set forth on Schedule 4.14 or as would
not have a Material Adverse Effect, (i) none of the properties
included in the Specified Real Estate is on a National Priority
List or the Comprehensive Environmental Response Compensation and
Liability Information System, or is the subject of any
remediation or cleanup of (whether being performed voluntarily or
under the direction of or by a Governmental Authority), or, to
DMFC's Knowledge, any investigation with respect to, any
contamination or pollution, and, to DMFC's Knowledge, no such
investigation, remediation or cleanup is threatened; and (ii) to
DMFC's Knowledge, no notices under Section 103 of CERCLA relating
to such Properties have been filed, or are required to have been
filed.
(c) Except as set forth on Schedule 4.14 or as would
not have a Material Adverse Effect, to DMFC's Knowledge, there
are no events, circumstances, or conditions relating to the
Environment, including but not limited to on-site or off-site
use, management or disposal of Hazardous Substances in connection
with (i) the properties included in the Specified Real Estate or
(ii) properties previously owned, operated or used by a member of
the Del Monte Group, which could give rise to any liability for
the Del Monte Group under any Environmental Law or which could be
reasonably expected to interfere with, or require material
changes to, the conduct of the operations of the Del Monte Group.
4.15 Outstanding Commitments.
(a) Schedule 4.15 contains a list, accurate and
complete in all material respects, as of the date hereof of all
Material Contracts, true and complete copies of which have been
furnished (or made available) to the Purchasers (excluding
purchase orders), to which a member of the Del Monte Group is a
party or by which any of the Assets or Operations are bound. Each
Material Contract is a valid and binding obligation of at least
one member of the Del Monte Group and, to DMFC's Knowledge, each
other party thereto, and is enforceable against a member of the
Del Monte Group and, to DMFC's Knowledge, each other party
thereto, in accordance with its terms, except to the extent that
such enforceability may be limited by bankruptcy, insolvency,
reorganization, moratorium or other similar laws relating to
creditors' rights generally and is subject to general principles
of equity, and no member of the Del Monte Group, nor to DMFC's
Knowledge, any other party, is in default under any Material
Contract, except in each case for such failures to be valid,
binding and enforceable and for such defaults which, individually
or in the aggregate, would not have a Material Adverse Effect.
(b) Except as would not have a Material Adverse
Effect, neither DMFC, the Company nor any of the Company's
Subsidiaries is in default under any of the Material Contracts.
No Proceeding (to DMFC's Knowledge in the case of any
investigation) or event or condition has occurred or exists, or
to DMFC's Knowledge, is alleged by any party to have occurred or
exist which, with notice or lapse of time or both, would
constitute a default by any of the parties thereto of their
respective obligations under a Material Contract (or would give
rise to any right of termination or cancellation), except as
would not have a Material Adverse Effect. No supplier of fruits
or vegetables or any insurance company has given written notice
of its intention to, or threatened to, terminate any Contract
with a member of the Del Monte Group which termination would have
a Material Adverse Effect.
4.16 Employee Benefits.
(a) Schedule 4.16(a) and Schedule 7.2 contain a list
of each plan, program, arrangement, agreement or commitment which
is an employment, consulting, termination or deferred
compensation agreement, or an executive compensation, incentive
bonus or other bonus, employee pension, profit-sharing, savings,
retirement, stock option, stock purchase, severance pay, life,
health, disability or accident insurance plan, or vacation, or
other employee benefit plan, program, arrangement, agreement or
commitment, including, without limitation, any "employee benefit
plan," within the meaning of Section 3(3) of ERISA, currently
maintained, sponsored, or contributed to
by each member of the Del Monte Group or to which any such member
has any obligation to contribute to, or with respect to which any
such member has any Liability (whether actual or contingent,
including, without limitation, a Liability arising out of an
indemnification, guarantee, hold harmless or similar agreement)
(each a "Plan" and, collectively, the "Plans"), including,
without limitation, any multiemployer plan within the meaning of
Section 3(37) of ERISA ("Multiemployer Plan"). With respect to
each Plan, a copy of the document embodying the Plan has been
delivered or made available to the Purchaser.
(b) Except as set forth on Schedule 4.16(b), each Plan
(other than a Multiemployer Plan) intended to be qualified under
Section 401(a) of the Code has received a favorable determination
letter from the Internal Revenue Service (the "IRS") that the
Plan is qualified and that its related trust has been determined
to be exempt from taxation under Section 501(a) of the Code and,
to DMFC's Knowledge, nothing has occurred since the date of such
letter that could reasonably be expected to cause any such Plan
or trust to cease to be so qualified or exempt. To DMFC's
Knowledge, each Multiemployer Plan has received a favorable
determination letter from the IRS that the Plan is qualified
under Section 401(a) of the Code and that its related trust has
been determined to be exempt from taxation under Section 501(a)
of the Code.
(c) Each member of the Del Monte Group has performed
all material obligations required to be performed under each
Plan. No event has occurred in connection with which any member
of the Del Monte Group or any Plan, directly or indirectly, could
be subject to any material Liability under ERISA, the Code or any
other Law, regulation or governmental order applicable to any
Plan, including, without limitation, Section 406, 409, 502(i),
502(l), 4069 or 4212(c) of ERISA, or Section 4971, 4975 or 4976
of the Code, or under any agreement, instrument, statute, rule of
law or regulation pursuant to or under which any member of the
Del Monte Group has agreed to indemnify or is required to
indemnify any person against Liability incurred under, or for a
violation or failure to satisfy the requirements of, any such
statute, regulation or order. Except as described in the
following sentence, all contributions required or payments due
and owing under each Plan, trust, collective bargaining agreement
or otherwise required by law with respect to all periods through
the Closing Date will be timely made and will be made no later
than the Closing Date, or accrued on the Financial Statements to
the extent required by United States generally accepted
accounting principles. The amount required to be paid with
respect to the deemed partial termination of the Retirement Plan
for Salaried Employees during 1992 does not exceed $1,200,000.
(d) No lawsuit or claim (other than routine claims for
benefits, and appeals of such claims) has been asserted or
instituted or, to DMFC's Knowledge, is threatened against any
Plan or its assets or fiduciaries or with respect to any Plan.
(e) To DMFC's Knowledge, no Plan is under audit by
the IRS or the Department of Labor.
(f) Except as set forth on Schedule 4.16(f), with
respect to each employee benefit plan that is subject to the
provisions of Title IV or Section 302 of ERISA or Section 412 of
the Code and with respect to which the Company or any ERISA
Affiliate may, directly or indirectly, incur any liability, no
event or circumstance exists or is expected to occur which has
given, or could reasonably be expected to give, rise to any
material liability or any lien under Title IV or Section 302 of
ERISA or Section 412 of the Code.
(g) Except as set forth in Schedule 4.16(g) and in
Schedule 7.2, the consummation of the transactions contemplated
by this Agreement will not (i) entitle any employee or former
employee of any member of the Del Monte Group to severance pay,
unemployment compensation or any other payment or (ii) accelerate
the time of payment, funding or vesting of, or increase the
amount of, compensation due to any such employee or former
employee.
(h) Except as set forth in Schedule 4.16(h), no member
of the Del Monte Group has any announced plan or commitment
(whether or not legally binding) to create any additional Plans
or to amend or modify any existing Plan.
(i) Except as set forth in Schedule 4.16(i), no member
of the Del Monte Group has violated any Legal Requirement
regarding the terms and conditions of employment of employees,
former employees or prospective employees of the Del Monte Group
or other labor related matters regarding the employees of the Del
Monte Group, including, without limitation, any Legal Requirement
relating to discrimination, fair labor standards and occupational
health and safety, wrongful discharge or violation of the
personal rights of employees, former employees or prospective
employees which, taken alone or together with any such violation
or violations, would have a Material Adverse Effect.
(j) Except as set forth on Schedule 4.16(j), no member
of the Del Monte Group could incur, directly or indirectly, any
material Liability (whether actual or contingent, including,
without limitation, a Liability arising out of an
indemnification, guarantee, hold harmless or similar agreement)
with respect to any employees or former employees arising out of
any divestiture by any member of the Del Monte Group of any
business or assets.
(k) Except as set forth on Schedule 4.16(k), no member
of the Del Monte Group has any material Liability (whether actual
or contingent, including, without limitation, a Liability arising
out of an indemnification, guarantee, hold harmless or similar
agreement) relating to any insurance contract held under or
purchased to fund a Plan the issuer of which is or was insolvent
or in reorganization or the payments under which were suspended.
(l) Schedule 4.16(l) sets forth any and all
indebtedness owed by any employee or former employee to any
member of the Del Monte Group.
(m) Except as set forth on Schedule 4.16(m) and
Schedule 7.2, no member of the Del Monte Group maintains any
plan, program or arrangement or is a party to any Contract that
provides any benefits or provides for payments to any Person
based on or measured by the value of any equity security of or
interest in a member of the Del Monte Group.
4.17 Employee Relations.
(a) Except as set forth on Schedule 4.17(a), since
January 1, 1994 there has not occurred or, to DMFC's Knowledge,
been threatened any strikes, slow downs, picketing, work
stoppages, concerted refusals to work overtime or other similar
labor activities with respect to employees employed in the
Operations. Except as set forth on Schedule 4.17(a), no grievance
or arbitration proceeding arising out of or under any collective
bargaining agreement relating to the Operations is pending, and,
to DMFC's Knowledge, no such grievance or proceeding is
threatened, except for grievances and proceedings which,
individually and in the aggregate, would not have a Material
Adverse Effect.
(b) Except as set forth on Schedule 4.17(b), the
employees employed in the Operations are not represented by any
labor union or other labor representative and, except as set
forth on Schedule 4.17(b), there are no collective bargaining
agreements or other arrangements in effect with respect to such
employees and, to DMFC's Knowledge, there are no other Persons
attempting to represent or organize or purporting to represent
any employees employed in the Operations.
4.18 Insurance. The insurance carried by DMFC, the
Company and its Subsidiaries is in such types and amounts and
covering such risks as are consistent with customary practices
and standards of companies engaged in businesses and operations
similar to those of DMFC, the Company and its Subsidiaries.
Except as would not have a Material Adverse Effect, all such
insurance is in full force and effect and none of DMFC, the
Company or any of its Subsidiaries is in default thereunder.
Except as would not have a Material Adverse Effect, all claims
thereunder have been filed in a due and timely fashion. Except as
would not have a Material Adverse Effect, neither DMFC, the
Company nor any of its Subsidiaries has been notified in writing
of a refusal of any material insurance coverage relating to
products liability (including renewals of any such products
liability coverage) by any insurance carrier to which it has
applied for insurance during the past three years.
4.19 Customers and Suppliers. Schedule 4.19
identifies, and provides an accurate and complete breakdown of
the revenues received from, the twenty largest customers or other
Persons (in terms of gross revenues from such customers or
Persons) of the Del Monte Group in the fiscal year ended June 30,
1996 and identifies, and provides an accurate and complete
breakdown of the dollar amount of purchases from the ten largest
suppliers of the Del Monte Group in the fiscal year ended June
30, 1996 (in terms of gross purchases from such suppliers).
Schedule 4.19 lists all exclusive arrangements between any member
of the Del Monte Group on the one hand and its customers or
suppliers on the other hand. There are no disputes, claims or
other actions or Proceedings (to DMFC's Knowledge in the case of
any investigation) between any member of the Del Monte Group, on
the one hand, and any such customer or other Person or any
supplier of the Del Monte Group, on the other hand, other than
those occurring in the ordinary course of business in amounts
consistent with past practices or that, individually or in the
aggregate, would not have a Material Adverse Effect. As of the
date of this Agreement, no member of the Del Monte Group has
received any notice or other communication (in writing or
otherwise), or any other information, indicating that there is a
material possibility that (i) any customer or other Person or
supplier identified in Schedule 4.19 will cease dealing with the
Del Monte Group or may otherwise materially reduce the volume of
business transacted by such customer or other Person or supplier
with the Del Monte Group below historical levels other than
reductions comparable to those experienced to date as a result of
the Company's Go-to-Market strategy, or (ii) the consummation of
the transactions contemplated hereby will adversely affect the
relationships of any member of the Del Monte Group with any of
its customers or suppliers.
4.20 Certain Financial Information.
(a) The adjustments included in the DMFC Combining
Statement of Operations as of June 30, 1996 set forth in Schedule
4.20(a) (the "DMFC Combining Statement") provided by DMFC and the
Company to Parent appropriately reflect the transactions
represented by such adjustments, and such adjustments have been
properly applied to the historical financial information for the
Del Monte Group in the compilation of the historical financial
information.
(b) The Evaluation of Adjusted Calendar Year 1996 set
forth in Schedule 4.20(b) has been prepared in good faith on a
reasonable basis and in a manner consistent with the DMFC
Combining Statement.
4.21 Affiliate Transactions. Except as set forth on
Schedule 4.21, (a) there is no indebtedness between any member of
the Del Monte Group, on the one hand, and any officer, director,
stockholder or Affiliate (other than the Company and its
Subsidiaries) of DMFC, on the other, (b) no such officer,
director or Affiliate provides or
causes to be provided any assets, services or facilities to the
Del Monte Group which are individually or in the aggregate
material to the business or condition of the Del Monte Group, (c)
no member of the Del Monte Group provides or causes to be
provided any assets, services or facilities to any such officer,
director or Affiliate which are individually or in the aggregate
material to the business or condition of the Del Monte Group, and
(d) no member of the Del Monte Group owns any capital stock,
indebtedness or other securities issued by any such officer,
director or Affiliate.
4.22 Inventory and Accounts Receivable. All inventory
of the Del Monte Group reflected on the January Balance Sheet
(the "Inventories") consists of a quality and quantity usable or
salable in the ordinary course of business, except for
slow-moving items and items of below-standard quality, all of
which have been written off or written down to net realizable
value in the January Balance Sheet. All Inventories not written
off have been priced at the lower of cost or market on a last in,
first out basis. All accounts receivable of the Del Monte Group
that are reflected on the January Balance Sheet (the "Accounts
Receivable") represent valid obligations arising from sales
actually made or services performed in the ordinary course of
business. The Accounts Receivable are current and collectible net
of the applicable reserves reflected in the January Balance Sheet
(which reserves are adequate and calculated consistent with past
practice). The Inventories and Accounts Receivable (net of the
applicable reserves) are $453.6 million and $63.0 million,
respectively.
4.23 Management Payments. Other than payments under
the Del Monte Corporation New Management Equity Plan, payment of
salary for July through December 1997 to each of the Co-Chief
Executive Officers of the Company, payments set forth on Schedule
4.16(g) and payments properly budgeted in the Company's 1997
Annual Operating Plan, there are no payments to management of the
Del Monte Group that (i) arise out of or are related to the
consummation of the Merger and the transactions contemplated
thereby or (ii) otherwise are payable during, or in respect of,
the Company's fiscal year ending June 30, 1997, in each case
whether or not set forth in Schedule 7.2.
ARTICLE V
REPRESENTATIONS AND WARRANTIES OF PURCHASERS
Purchasers represent and warrant to DMFC:
5.1 Organization. Each Purchaser is an entity duly
organized, validly existing and in good standing under the laws
of its jurisdiction of incorporation or formation and has full
power and authority to own, lease and operate its Properties and
to carry on its businesses as now being conducted.
5.2 Authority; Enforceability. Each Purchaser has the
power and authority to enter into this Agreement and to carry out
its obligations hereunder. The execution and delivery of this
Agreement and the consummation of the transactions provided for
hereby have been duly authorized by the general partner of Parent
and the Board of Directors of Sub, and no other approval on the
part of either Purchaser is necessary to authorize the execution
or delivery of this Agreement or the consummation of any of the
transactions contemplated hereby. This Agreement has been duly
executed and delivered by each Purchaser and (assuming due
authorization, execution and delivery by DMFC) constitutes a
legal, valid and binding obligation of each Purchaser,
enforceable against it in accordance with its terms, except as
enforcement thereof may be limited by bankruptcy, insolvency
(including, without limitation, all laws relating to fraudulent
transfers), reorganization, moratorium or similar laws affecting
creditors' rights generally and except as enforcement thereof is
subject to general principles of equity (regardless of whether
considered in a proceeding in equity or at law).
5.3 No Breach. Except as would not impair the ability
of Purchasers to consummate the Merger, each of the execution and
delivery of this Agreement and the consummation of the
transactions contemplated hereby does not and will not (i)
conflict with or violate any provision of the Articles of
Incorporation, By-laws or other governing documents of either
Purchaser, (ii) violate, conflict with or result in the breach or
termination of, or otherwise give any other Person the right to
accelerate, renegotiate, terminate or receive any payment, or
constitute a default, event of default or an event which with
notice, lapse of time, or both, would constitute a default or
event of default under the terms of, any Contract or Permit to
which either Purchaser is a party or by which such Purchaser or
its Properties or businesses are bound, (iii) result in the
creation of any Liens upon any of their respective Properties or
businesses or (iv) constitute a violation by either Purchaser of
any Legal Requirement.
5.4 Consents. No Consent of or by, or filing with, any
Governmental Authority is required to be made or obtained by
either Purchaser in connection with (i) the execution or delivery
of this Agreement or (ii) the consummation of any of the
transactions provided for in this Agreement, other than (a) those
the failure of which to be made or obtained, individually or in
the aggregate, would not have a material adverse effect on the
ability of Purchasers to consummate the transactions contemplated
by this Agreement and (b) Consents and filings under the HSR Act
and the MGCL.
5.5 Actions and Proceedings. There is no Proceeding
(to Purchasers' Knowledge in the case of any investigation)
pending or, to the best knowledge of Purchasers, threatened, nor
any Judgment (which has not been discharged), (a) against either
Purchaser before any Governmental Authority to restrain or
prohibit, or to obtain
damages, a discovery order or other relief in connection with
this Agreement or any of the transactions contemplated by this
Agreement or (b) as of the date hereof, and except as previously
disclosed to DMFC, against either Purchaser or any of their
Affiliates, by or before any Governmental Authority, that, if
adversely determined, would (i) adversely affect Purchasers'
ability to perform their obligations hereunder or to consummate
the transactions contemplated hereby, or (ii) require any of the
holders of DMFC Common Stock or DMFC Preferred Stock to pay over
any portion of the Purchase Price to any Person, including,
without limitation, any Governmental Authority.
5.6 Brokers. Except as disclosed by Parent to DMFC,
neither Parent, Sub nor anyone acting on any of their behalf has
employed any broker or finder or incurred any liability for any
brokerage fees, commissions or finders fees in connection with
the Merger and the transactions contemplated by this Agreement.
5.7 Availability of Funds. Purchasers have available
or have binding commitments for, and will have available on the
Closing Date, sufficient funds to enable them to consummate the
transactions contemplated by this Agreement, including the
payment of the Purchase Price.
5.8 Surviving Corporation After the Merger.
Immediately after the Effective Time and after giving effect to
the Merger, the Surviving Corporation will not (i) be insolvent
(either because its financial condition is such that the sum of
its debts is greater than the fair value of its assets or because
the fair saleable value of its assets is less than the amount
required to pay its probable liability on its existing debts as
they mature), (ii) have unreasonably small capital with which to
engage in its business, or (iii) have incurred debts beyond its
ability to pay as they become due.
ARTICLE VI
COVENANTS OF DMFC
6.1 Ordinary Course of Business. During the period
from the date of this Agreement to the Effective Time, except as
contemplated by this Agreement or as set forth on Schedule 6.1 or
as otherwise consented to in writing by Purchasers (which consent
shall not unreasonably be withheld):
(a) DMFC will use all reasonable efforts, and will
cause its Subsidiaries to use all reasonable efforts, to (i)
carry on its business in the ordinary course in substantially the
same manner as heretofore conducted consistent with such business
and with its "go-to-market" strategy, (ii) preserve intact its
present business organization, (iii) keep available the services
of its present officers and employees, (iv)
preserve its relationships with clients, suppliers, customers,
distributors and others having business dealings with it, (v)
maintain all Assets other than those disposed of in the ordinary
course of business in all material respects in good repair and
condition and (vi) maintain all insurance; and
(b) Except as expressly provided for in Article II
hereof, DMFC will, and will cause its Subsidiaries to:
(i) not amend its Articles of
Incorporation or By-laws or other governing document
or agreement;
(ii) not acquire by merging or
consolidating with, or purchasing all or substantially
all of the assets of, or otherwise acquiring any
business of any corporation, partnership, association
or other business organization or division thereof, in
each case for consideration having a value in excess
of $1,000,000;
(iii) not split, combine or reclassify
its outstanding capital stock or declare, set aside,
make or pay any dividend or other distribution in
respect of the capital stock of any member of the Del
Monte Group (in cash or otherwise), except dividends
in kind in respect of the Preferred Stock;
(iv) not issue or sell (or agree to
issue or sell) any shares of its capital stock of any
class or series, or any options, warrants, conversion
or other rights to purchase any such shares or any
securities convertible into or exchangeable for such
shares, or grant, or agree to grant, any such options
or modify or alter the terms of any of the above;
(v) not, other than in the ordinary
course of business consistent with past practice, (A)
incur any indebtedness for borrowed money or vary the
material terms of any existing debt securities, (B)
issue or sell any debt securities, (C) acquire any
substantial assets outside of the ordinary course of
business, (D) except to the extent required by
applicable Law, make any change in any investment,
accounting, financial reporting, inventory, credit,
allowance or tax practice or policy or (E) enter into,
modify in any material respect or terminate any
Material Contract;
(vi) not sell, mortgage, pledge or
otherwise dispose of any Assets or Properties, except
for the sale of inventory and disposition of obsolete
equipment, other than in the ordinary course of
business consistent with prior practice and following
prior notice to and consultation with Purchasers;
(vii) not grant to any director, or,
except in the ordinary course of business consistent
with prior practice, consultant, officer, employee or
agent of any member of the Del Monte Group, any
increase in compensation in any form, or any severance
or termination pay, or make any loan to any such
person, except in each case as may be legally required
pursuant to any existing employment or termination
agreements, Plan or applicable Laws;
(viii) not adopt, enter into, amend in
any material respect, terminate or announce any
intention to adopt, amend or terminate, any Plan,
except as required by applicable Law or as disclosed
on any disclosure schedule pursuant to Section 4.15;
(ix) not discharge or satisfy any
material Lien or pay or satisfy any material
obligation or Liability or compromise, settle or
otherwise adjust any material claim or litigation,
except in the ordinary course of business consistent
with past practice or commence any voluntary petition,
proceeding or action under any bankruptcy, insolvency
or other similar laws;
(x) not make or institute any material
change in its accounting procedures or practices unless
mandated by GAAP;
(xi) not perform any act, or attempt to
do any act, or knowingly permit any act or omission to
act, which will cause a breach of any Material
Contract;
(xii) not make any Tax election or
settle or compromise any material federal, state,
local or foreign income Tax Liability, other than in
the ordinary course of business consistent with prior
practice and following prior notice to and
consultation with Purchasers;
(xiii) not (in a manner that deviates
from their historical practice) (a) delay payment of
any material account payable or other material
liability, (b) offset any material account payable or
material Liability to a person against any account
receivable or payment due from such person, (c)
accelerate the collection of accounts receivable, (d)
accelerate the sale or liquidation of any inventory,
or (e) delay the making of scheduled capital
expenditures (including, without limitation, the
capital expenditures identified in Schedule 4.13(a)
to the extent legally required);
(xiv) not make capital expenditures or
commitments for additions to property, plant or
equipment constituting capital assets in an amount
which exceeds $100,000 individually or $1,000,000 in
the aggregate during the period from the date of this
Agreement to the Closing Date, except for capital
expenditures included in DMFC's 1997 capital
expenditure plan (a copy of which is attached hereto
as Schedule 6.1(b)(xiv)), which capital expenditures
the Del Monte Group shall make in accordance with such
plan;
(xv) not decrease any reserve
(including any valuation allowance) for Taxes or other
Liabilities on the books of any member of the Del
Monte Group or otherwise provided therefor, except for
Taxes or other Liabilities relating to the operations
of the Del Monte Group since the date of this
Agreement and except in the ordinary course of
business consistent with past practices;
(xvi) not sell, assign, transfer,
license or permit to lapse any right with respect to
material United States Intellectual Property Rights;
(xvii) not make any loan, or redeem or
purchase any of its capital stock, transfer any asset
or pay any commission, salary or bonus, or pay any
rent, commission or fee, or enter into or agree to
enter into any transaction, to, with or for the
benefit of any shareholder or any relative or
Affiliate of any shareholder other than the
transactions contemplated by this Agreement or
pursuant to the agreements listed on Schedule 4.21;
(xviii) not write off any account
receivable or other indebtedness as uncollectible in
an amount in excess of existing reserves, or establish
any extraordinary reserve or decrease any existing
reserve, except in the ordinary course of business
consistent with past practices; or
(xix) not authorize or propose, or agree
to take, any of the actions set forth in the foregoing
subparagraphs (i) through (xviii).
6.2 Access to Information. Except as prohibited or
limited by Law, DMFC shall, from and after the date of this
Agreement and until the Closing Date, give and cause the other
members of the Del Monte Group to give to Purchasers and their
prospective lenders and financing institutions, officers, agents,
representatives,
advisers, accountants, employees and counsel full and complete
access, upon reasonable prior notice and during normal business
hours, to all officers, employees, agents, representatives,
counsel, consultants, contractors, advisers, offices, properties,
Contracts, Permits, Judgments, papers, books, documents, plans,
agreements, records and affairs of the Del Monte Group or
otherwise relating to the Operations, and will, at Purchasers'
sole expense, provide copies of such information concerning the
Del Monte Group and the Assets and Operations as such persons may
reasonably request; provided, however, that the foregoing shall
not permit Purchasers or any agent of either of them to disrupt
the Operations or to perform any testing on any real property
owned or leased by any member of the Del Monte Group.
Notwithstanding the preceding sentence, if, after the date of
this Agreement, Purchasers become aware of any fact relating to
the existence of Hazardous Substances at any site owned or leased
(subject to receipt of any required consents) by the Company that
in the judgment of Purchaser and a nationally recognized
environmental consultant retained by Purchaser is reasonably
likely to result in liability to the Del Monte Group in excess of
$1,000,000, Purchasers may perform testing (subject to DMFC's
prior review and reasonable approval of the scope of testing).
From and after the date of this Agreement and until the Closing
Date, DMFC shall, and shall cause each member of the Del Monte
Group to, regularly consult with Purchasers regarding the
management of the business and Operations of the Del Monte Group,
including without limitation the ongoing implementation of the
"go-to-market" strategy.
6.3 Stockholder Approvals; Stock Conversions.
(a) DMFC shall call a special meeting (the "Special
Meeting") of its stockholders to be held not later than March 31,
1997 for the purpose of submitting the Merger and the Executive
Arrangements referred to in the Proxy attached as Exhibit X- 0
for the approval of the stockholders of DMFC. DMFC shall, through
its Board of Directors, recommend that its stockholders approve
the Merger and such Executive Arrangements and shall use all
reasonable efforts (without requiring DMFC to incur material
costs or expenses or to commence Proceedings) to solicit the
requisite vote necessary for such approval in accordance with the
applicable provisions of the MGCL and this Agreement.
(b) DMFC shall promptly (and within five business days
of the receipt of notice by DMFC) give notice to Purchasers of
the conversion of any shares of DMFC Common Stock or DMFC
Preferred Stock by any stockholder of DMFC, such notice to
specify the number of shares and class of DMFC Common Stock or
DMFC Preferred Stock converted by such stockholder and the number
of shares and class of DMFC Common Stock or DMFC Preferred Stock
received by such stockholder upon such conversion.
6.4 Cancellation of Certain Arrangements. Except as
set forth on Schedule 6.4, all accounts payable or Contracts
obligating DMFC, the Company or any of the Company's Subsidiaries
to make payments to the stockholders of DMFC or their Affiliates
(other than the Company and its Subsidiaries), or to provide the
stockholders of DMFC or their Affiliates (other than the Company
and its Subsidiaries) any rights to use any of the Assets shall
be canceled at or prior to the Closing without any consideration
being paid in respect therefor.
6.5 No Shop Provision. During the period from the date
of this Agreement to the earlier of the termination of this
Agreement and the Closing, DMFC shall not, and shall cause the
Company and its Subsidiaries and their respective directors,
officers, employees, agents and representatives not to (a)
solicit, initiate or encourage, directly or indirectly, any
inquiries, discussions, proposals or offers for, (b) continue,
propose or enter into any discussions or negotiations looking
toward, (c) consider any proposal for, or (d) enter into any
agreement or understanding providing for, any acquisition by a
third party of the capital stock, assets or businesses of DMFC,
the Company or any of its Subsidiaries; nor shall any of such
persons or entities provide any information to any Person (other
than Purchasers and their representatives, accountants, advisors,
consultants and counsel) for the purpose of evaluating or
determining whether to make or pursue any inquiries or proposals
with respect to any such transactions. DMFC will promptly advise
Purchasers of, and communicate to Purchasers the terms of, any
such inquiry or proposal that the officers or directors of any
member of the Del Monte Group may receive or of which such
persons may become aware during the period referred to in the
first sentence of this subsection and which any of the foregoing
persons believes to be a bona fide offer or a serious indication
of interest.
6.6 Affiliate Transactions. Except as set forth in
Schedule 4.21 or as requested by Purchasers prior to or
concurrently with the Closing, any indebtedness and other amounts
owing under contracts between any officer, director or Affiliate
(other than the Company or any Subsidiary of the Company) of
DMFC, on the one part, and any member of the Del Monte Group, on
the other, will be paid in full and DMFC will cause to be
terminated each such contract. During the period from the date of
this Agreement to the Closing Date, no member of the Del Monte
Group will engage in any transaction (other than pursuant to
contracts disclosed in Schedule 4.21), including borrowing any
money or receiving any capital contribution, from or with any
such officer, director or Affiliate.
6.7 Recapitalization Accounting Treatment. DMFC agrees
to cooperate in all reasonable respects with Purchaser in
Purchasers' efforts to persuade existing stockholders of DMFC to
become stockholders of the Surviving Corporation, including
without limitation by providing access to existing stockholders
of DMFC, and, if Purchasers are successful, DMFC shall make any
appropriate amendments to
this Agreement and the structure of the financing of the
transactions contemplated by this Agreement so that the
transactions contemplated hereby could be accounted for pursuant
to recapitalization accounting, provided that any amendment to
this Agreement or to the structure of the financing of the
transactions contemplated by this Agreement does not and will not
reduce the Purchase Price payable by Purchasers hereunder (except
to the extent that any existing DMFC stockholders receive or
retain capital stock of DMFC pursuant to this Agreement or the
transactions contemplated hereby, in which case the Purchase
Price shall be reduced to reflect such fact).
ARTICLE VII
COVENANTS OF PURCHASERS
7.1 Employee Benefits. For a period of 12 months
following the Closing, Purchasers shall cause the Surviving
Corporation and its Subsidiaries to maintain for employees of the
Surviving Corporation and its Subsidiaries (other than any
employees covered by a collective bargaining agreement),
considered collectively, compensation, benefits and perquisites
which are no less favorable in the aggregate than the
compensation, benefits and perquisites enjoyed by such employees
prior to the Closing; provided, however, that except as otherwise
provided in the Executive Arrangements, nothing herein shall be
construed as requiring the continued employment of any employee
nor the continuation of any particular employee benefit or
perquisite. This Agreement is not intended to constitute an
actual or de facto amendment of any employee benefit plan,
program, agreement or arrangement and nothing herein shall be so
construed.
7.2 Executive Arrangements. Schedule 7.2 sets forth
the arrangements (the "Executive Arrangements") between the Del
Monte Group and certain executives and employees of the Del Monte
Group with respect to a sale of DMFC, true and complete copies of
which have been made available to Purchasers.
(a) Purchasers shall cause each member of the Del
Monte Group to satisfy all of its obligations under each
agreement set forth on Schedule 7.2(a). If there is any conflict
between the summary of any such agreement set forth on such
schedule and the terms of the agreement, the terms of the
agreement shall in all cases govern.
(b) Purchasers shall cause the Company to pay, on the
Closing Date, the amounts described in Schedule 7.2(b) to the
persons indicated thereon, subject to applicable withholding
taxes. Such payment shall also be subject to (i) the approval of
such payments by the shareholders of DMFC for purposes of Section
280G of the Code and (ii) receipt by the Company of a receipt
from each such person acknowledging that
the indicated payment is in full satisfaction of the Company's
obligations with respect to the New Management Equity Plan.
(c) Purchasers shall cause the Company to pay, on the
Closing Date, the amounts described in Schedule 7.2(c) to the
persons indicated thereon, subject to applicable withholding
taxes and to receipt by the Company of a receipt from each such
person acknowledging that the indicated payment is in full
satisfaction of the Company's obligations with respect to the
1995 Management Equity Plan.
(d) Purchasers shall cause the bonus pool under the
Annual Incentive Award Plan ("AIPA") with respect to the
performance period ending on June 30, 1997 to equal at least
$2,525,100. Bonuses shall be paid pursuant to and in accordance
with the terms of such Plan not later than July 31, 1997. Any
participant who is involuntarily terminated without cause on or
before July 31, 1997 shall be paid a pro-rata share of the
participant's AIAP target with consideration given for
performance factors.
(e) Purchasers shall cause the Company to pay, on the
Closing Date, the amounts described in Schedule 7.2(e) to the
persons indicated thereon, subject to applicable withholding
taxes and to receipt by the Company of a receipt from each such
person acknowledging that the indicated payment is in full
satisfaction of the Company's obligations with respect to the
Long Term Incentive Plan.
7.3 Indemnification: Officers' and Directors' Insurance.
(a) The Purchasers agree that all rights to
indemnification existing as of the date hereof in favor of the
present or former directors, officers, employees, fiduciaries and
agents of DMFC, the Company or any of its Subsidiaries as
provided in DMFC's certificate of incorporation or by-laws or
pursuant to other agreements, arrangements or the certificate of
incorporation, by-laws or similar documents of any of the
Company's Subsidiaries as in effect on the date hereof with
respect to matters occurring prior to the Effective Time shall
survive the Merger and shall continue in full force and effect
pursuant to the terms thereof. Purchasers shall cause to be
maintained in effect for not less than six years from the
Effective Time the current policies of directors' and officers'
liability insurance maintained by the Company and its
Subsidiaries (provided that Purchasers may substitute therefor
policies of at least the same coverage containing terms and
conditions which are no less advantageous) with respect to
matters occurring prior to the Effective Time. True and complete
copies of all such agreements, arrangements and insurance
policies have been made available to Purchasers.
(b) It is understood and agreed that the Company
shall, to the fullest extent permitted under applicable law and
regardless of whether the Merger becomes effective, indemnify and
hold harmless, and after the Effective Time, the Surviving
Corporation shall, to the fullest extent permitted under
applicable law, indemnify and hold harmless, each present and
former director, officer and fiduciary of the Company or any of
its Subsidiaries (collectively, the "Indemnified Parties")
against any fees, costs or expenses (including reasonable
attorneys' fees) and judgments, fines, losses, damages,
liabilities and amounts paid in settlement, in connection with
any pending, threatened or completed claim, action, suit,
proceeding or investigation arising out of any actions or
omissions occurring at or prior to the Effective Time that are in
whole or in part based on or arising out of the fact that such
person is or was a director, officer or fiduciary of DMFC or
pertaining to any of the transactions contemplated hereby, and in
the event of any such claim (whether commenced before or after
the Effective Time), (i) the Company or the Surviving Corporation
shall pay the reasonable fees and expenses of counsel selected by
the Indemnified Parties, which counsel shall be reasonably
satisfactory to the Company or the Surviving Corporation, as the
case may be, promptly after statements therefor are received and
shall advance other expenses to the fullest extent permitted
under applicable law and (ii) the Company and the Surviving
Corporation shall cooperate in the defense of any such matter;
provided, however, that neither the Company nor the Surviving
Corporation shall be liable for any settlement effected without
its written consent (which consent shall not be unreasonably
withheld). Notwithstanding the foregoing, neither the Company nor
the Surviving Corporation shall have any obligation to indemnify
and hold harmless any Indemnified Party against any judgments
rendered by a court of competent jurisdiction if such court finds
that such party engaged in conduct constituting gross negligence,
willful misconduct or willful violation of law.
(c) If any action, suit, proceeding or investigation
relating hereto or to the transactions contemplated hereby is
commenced, whether before or after the Effective Time, the
Company and, after the Effective Time, the Surviving Corporation,
shall agree to use their best efforts to defend against and
respond thereto.
(d) This Section 7.3 shall survive for a period of six
years following the Effective Time and is intended to benefit the
Company, the Surviving Corporation and the Indemnified Parties.
In the event the Company or the Surviving Corporation or any of
their respective successors or assigns (i) consolidates with or
merges into any other person and shall not be the continuing or
surviving corporation of such consolidation or merger, or (ii)
transfers all or substantially all of its properties to any
person, then, and in each case, proper provision shall be made so
that the successors and assigns of the Company and the Surviving
Corporation, as the case may be, shall assume the obligations set
forth in this Section 7.3.
7.4 Financing. Purchasers have delivered to DMFC true
and complete copies of commitment letters (the "Commitment
Letters") from Bank of America National Trust and Savings
Association and Bankers Trust Company (but not signed by Purchasers)
to provide the debt financing required to effect the transactions
contemplated by this Agreement (the "Required Financing"). If
DMFC delivers the 66- 2/3% Proxies (as defined in Section
10.1(c)), on the following business day, Purchasers shall execute
and deliver to DMFC the Commitment Letters. Purchasers shall use
their best efforts to enter into, within four weeks after the
date of delivery of the 66-2/3% Proxies, fully executed and
binding definitive financing agreements with Bank of America
National Trust and Savings Association and/or Bankers Trust
Company, subject only to normal conditions, to provide the
Required Financing on substantially the terms set forth in the
commitment letters. Purchasers shall deliver to DMFC true and
complete copies of such financing agreements as soon as they are
available. If for any reason the Required Financing is not
available from Bank of America National Trust and Savings
Association and/or Bankers Trust Company, Purchasers shall use
their best efforts to obtain alternative sources of the Required
Financing on substantially the same terms and conditions.
Purchasers shall use their best efforts to satisfy all conditions
to the closing of the Required Financing prior to or at the
Closing. Prior to or at the Closing, Parent and its Affiliates
shall make (or cause to be made) a cash equity investment in Sub
equal to $140 million or such other amount as would satisfy the
equity funding requirements of the Required Financing.
ARTICLE VIII
ADDITIONAL AGREEMENTS
8.1 Company Debt. The Purchasers acknowledge that the
Merger will constitute an Event of Default under the Term Loan
Agreement and the Revolving Credit Agreement and that the holders
of the PIK Notes will have a right, as a result of the Merger, to
put the PIK Notes to the Company. If the Purchasers so request,
the Company and the Purchasers shall together seek to obtain from
the lenders under the Term Loan Agreement, the lenders under the
Revolving Credit Agreement and the holders of the PIK Notes a
waiver of the Event of Default under the Term Loan Agreement, a
waiver of the Event of Default under the Revolving Credit
Agreement, or a waiver of the right to put the PIK Notes from the
Company, as the case may be, as a result of the Merger. If the
Purchaser does not so request, or if the lenders under the Term
Loan Agreement or the Revolving Credit Agreement or the holders
of the PIK Notes refuse to grant such waiver, the Purchasers
shall provide to the Company at the Closing all funds required to
repay in full the indebtedness under the Term Loan Agreement, the
indebtedness under the Revolving Credit Agreement or the PIK
Notes, as the case may be, including any prepayment premiums or
penalties thereunder.
8.2 Further Actions. Subject to the terms and
conditions herein provided, each of the parties hereto shall use
its reasonable efforts to take, or cause to be taken, all actions
and to do, or cause to be done, all things reasonably required
under applicable Legal Requirements, to consummate and make
effective the transactions
contemplated by this Agreement. Subject to the terms and
conditions herein provided, DMFC and Purchasers will, and will
cause each of their respective Affiliates to, use their
reasonable efforts to obtain all Consents necessary or advisable
to consummate and make effective the transactions contemplated by
this Agreement. In case at any time after the date hereof any
further action is necessary or desirable to carry out the
purposes of this Agreement, the proper officers or directors of
DMFC, Purchasers or the Company, as the case may be, shall take
all such necessary action. In the event that any injunction shall
at any time be in effect that prohibits or declares illegal the
Merger or any of the other transactions contemplated by this
Agreement, Purchasers shall use their best efforts to have such
injunction lifted as soon as practicable. In addition, Purchasers
shall, and shall cause their Affiliates to, take promptly any or
all actions to the extent necessary to eliminate each and every
impediment under any antitrust law that may be asserted by any
Governmental Authority with respect to the consummation of the
Merger or any of the other transactions contemplated hereby,
including, without limitation, entering into negotiations,
providing information, making proposals, entering into and
performing agreements or submitting to judicial or administrative
orders, or selling or otherwise disposing of, or holding
separate, particular assets or categories of assets, or
businesses, of Purchasers or their Affiliates. Without limiting
the foregoing provisions of this Section 8.2, DMFC and Purchasers
each shall file with the Department of Justice and the Federal
Trade Commission a Pre-Merger Notification and Report Form
pursuant to the HSR Act in respect of the transactions
contemplated hereby within five business days of the date of this
Agreement and shall cooperate with one another in connection with
their respective filings under the HSR Act and in connection with
resolving any investigation or other inquiry concerning the
transactions contemplated hereby commenced by either the
Department of Justice or the Federal Trade Commission.
8.3 Certain Notifications. At all times prior to the
Closing Date, each party shall promptly notify the other in
writing of the occurrence of any event which will or may result
in the failure of any of the conditions contained in Article IX
hereof to be satisfied.
8.4 Confidentiality.
(a) Each Purchaser shall, and shall use its best
efforts to cause its officers, employees, agents and
representatives to, hold in strict confidence all data and
information obtained by it from any member of the Del Monte Group
or any agent of any such member (unless such information is or
becomes readily ascertainable from public or published
information other than as a result of disclosure prohibited
hereby) ("Confidential Information") and shall not, and shall use
its best efforts to ensure that such officers, employees, agents
and representatives do not, disclose any of such data and
information to others without the prior written consent of DMFC
or use any of such data and information for any purpose other
than considering or furthering the
transactions contemplated by this Agreement (except as required
by any applicable Law).
(b) In the event that this Agreement is terminated,
Purchasers shall return promptly to DMFC or destroy every
document furnished to either of them by or on behalf of any
member of the Del Monte Group in connection with the transactions
contemplated hereby and any copies thereof which may have been
made, and shall cause their representatives to whom such
documents were furnished promptly to return to DMFC such
documents and any copies thereof any of them may have made.
(c) In the event that either Purchaser is requested
pursuant to, or required by, applicable law or regulation or by
legal process to disclose any Confidential Information, it shall
provide DMFC with prompt written notice of such request or
requirement in order to enable DMFC to seek an appropriate
protective order or other remedy, to consult with such other
party with respect to taking steps to resist or narrow the scope
of such request or legal process, or to waive compliance, in
whole or in part, with the terms of this Section 8.4. In any such
event, such Purchaser will use its reasonable best efforts to
ensure that all such Confidential Information and data that is so
disclosed will be accorded confidential treatment.
8.5 Fulfillment of Conditions and Certain
Notifications. DMFC and Purchasers shall each take all steps
necessary or desirable and proceed diligently and in good faith
to satisfy each condition to the obligations of the other(s).
Without limiting the generality of the foregoing, DMFC shall take
all actions reasonably requested by Purchasers in connection with
the Required Financing and the refinancing of the Existing Senior
Debt and the PIK Notes (including making appropriate officers of
DMFC available on a reasonable basis for road show
presentations), giving due regard to the time schedule for
Closing, and shall provide reasonable access to the Lenders, any
other prospective Lenders and their respective counsel,
accountants and representatives in connection with the Required
Financing. DMFC shall not, and shall not permit any member of the
Del Monte Group to, take or knowingly fail to take any action
that could reasonably be expected to result in the nonfulfillment
of any such condition, and Purchasers shall not take or knowingly
fail to take any action that could reasonably be expected to
result in the nonfulfillment of any such condition.
8.6 Expenses and Break-Up Fee. If Purchasers terminate
the Agreement pursuant to Section 10.1(c) or (d), DMFC shall (or
shall cause the Company to) pay to Purchasers on the second
business day following termination the sum of $2,000,000 to
reimburse Purchasers for their expenses in connection with the
transactions contemplated by this Agreement. If the Agreement is
terminated for any reason other than a material breach by
Purchasers, and if within 12 months from the date of such
termination an Acquisition Event (as hereinafter defined) occurs
at a price higher than the Purchase Price, DMFC shall (or shall
cause the Company to) pay to
Parent a fee of $15,000,000. As used herein, "Acquisition Event"
shall mean the consummation of any transaction (or series of
transactions) that results in any person, entity or "group"
(other than Parent or any of its Affiliates) acquiring all or
substantially all of the outstanding shares of DMFC Common Stock
and DMFC Preferred Stock or all or substantially all of the
assets of DMFC or the Company (including through any merger or
business combination). Purchasers acknowledge that payment of the
$15,000,000 fee requires approval by the Board of Directors of
DMFC; DMFC shall hold a meeting of the Board of Directors by
February 24, 1997 to consider the fee, and shall notify
Purchasers of the Board's determination. If the Board does not
approve the payment of the fee, Purchasers may terminate the
Agreement, in which event DMFC shall (or shall cause the Company
to) pay to Purchasers on the second business day following
termination the sum of $2,000,000 as provided above.
ARTICLE IX
CONDITIONS PRECEDENT TO CLOSING OBLIGATIONS
9.1 Conditions Precedent to Obligations of Purchasers. The
obligations of Purchasers to consummate the Merger at the Closing
are subject to the satisfaction or waiver at or prior to the
Closing of each of the following conditions:
(a) All representations and warranties of DMFC
contained in this Agreement shall be true and correct
in all material respects as of the Closing Date as
though made on and as of such date, except to the
extent that any such representation or warranty is
made as of a specified date, in which case such
representation or warranty shall have been true and
correct in all material respects as of such date, and
except that any representation or warranty that is
qualified by materiality or Material Adverse Effect
shall be true and correct in all respects (giving
effect to such qualification);
(b) DMFC shall have performed and complied with
the covenants in sub-sections 6.1(b)(i), 6.1(b)(iii),
6.1(b)(iv), 6.1(b)(xvii) and, with respect only to
directors of any member of the Del Monte Group who are
not officers or employees, 6.1(b)(vii), and DMFC shall
have performed and complied with, in all material
respects, all other agreements and covenants required
by this Agreement to be performed or complied with by
DMFC prior to or at the Closing, except that any
agreement or covenant that is qualified by materiality
or Material Adverse Effect shall have been performed
and complied with in all respects (giving effect to
such qualification);
(c) No Law or Judgment shall be in effect which
prohibits or declares illegal the Merger or the other
transactions contemplated by this Agreement;
(d) The approval of the Merger by the stockholders
of DMFC shall have been obtained;
(e) All waiting periods specified under the HSR
Act, and all extensions thereof, the passing of which
are necessary for consummation of the Merger, shall
have passed;
(f) The Purchasers shall have received from DMFC
a certificate, signed by an appropriate officer, as to
compliance with the conditions set forth in paragraphs
(a) and (b) of this Section 9.1;
(g) The Purchasers shall have received from
Xxxxxxx X. Xxxxxxx, Proskauer Xxxx Xxxxx & Xxxxxxxxxx
LLP and Xxxxxxx Xxxxx Xxxxxxx & Ingersoll legal
opinions in form and substance reasonably satisfactory
to Purchasers and their counsel with respect to the
matters set forth in the first and the third and
fourth (except with respect to the Company's
Subsidiaries) sentences of Section 4.1, Section 4.2,
the first and second sentences of Section 4.3(a),
Section 4.3(b) and (c), clauses (i), (ii) and (iv) of
Section 4.4 (except with respect to the Company's
Subsidiaries), Section 4.6 and the first sentence of
Section 4.7 with respect to Proceedings and Judgments;
(h) Since the date of this Agreement, no change
or circumstance resulting in a Material Adverse Effect shall
have occurred;
(i) All of the conditions to the funding
contemplated by the written commitments from the
lenders (the "Lenders") with respect to the financings
(the "Financings") to be entered into by Sub in
connection with the transactions contemplated by this
Agreement, copies of which written commitments have
been furnished to DMFC, shall have been satisfied in
full or waived and such Lenders shall have provided or
made available to Sub the cash contemplated by such
Financings;
(j) DMFC shall have provided to the Purchasers the
statement described in Treasury Regulation Section
1.1445-2(c)(3) certifying that none of the interests in
DMFC or the Company are U.S. real property interests for
purposes of Section 1445 of the Code. Such statement will
be complete, accurate and valid on the Closing Date.
If such statement is not
received by or on the Closing Date, DMFC shall withhold
all amounts required to be withheld by Section 1445 of
the Code; and
(k) No Person shall have commenced or threatened
to commence any actions or proceedings against a
member of the Del Monte Group that challenges or seeks
(or would challenge or seek) the recovery of a
material amount of damages in connection with the
transactions contemplated hereby and that in
Purchasers' reasonable judgment presents a material
risk of a material adverse judgment or ruling against
such member of the Del Monte Group.
9.2 Conditions Precedent to Obligations of DMFC. The
obligation of DMFC to consummate the Merger at the Closing is
subject to the satisfaction or waiver at or prior to the Closing
of each of the following conditions:
(a) All representations and warranties of
Purchasers contained in this Agreement shall be true
and correct in all material respects on and as of the
Closing Date as though made on and as of such date,
except to the extent that any such representation or
warranty is made as of a specified date, in which case
such representation or warranty shall have been true
and correct in all respects as of such date;
(b) Purchasers shall have performed and complied
with, in all material respects, all agreements and
covenants required by this Agreement to be performed
or complied with by them prior to or at the Closing,
except that any agreement or covenant that is
qualified by materiality or Material Adverse Effect
shall have been performed and complied with in all
respects (giving effect to such qualification);
(c) No Law or Judgment shall be in effect which
prohibits or declares illegal the Merger or the other
transactions contemplated by this Agreement;
(d) The approval of the Merger by the
stockholders of DMFC shall have been obtained;
(e) All waiting periods under the HSR Act,
and all extensions thereof, the passing of which are
required for consummation of the Merger, shall have
passed;
(f) Purchasers shall have made the payments
required by Section 2.5(b);
(g) DMFC shall have received from Purchasers a
certificate, signed by an appropriate officer of each
Purchaser, as to compliance with the conditions set
forth in paragraphs (a) and (b) of this Section 9.2;
(h) DMFC shall have received from Cleary,
Gottlieb, Xxxxx & Xxxxxxxx, counsel to Purchasers, a
legal opinion in form and substance reasonably
satisfactory to DMFC and its counsel with respect to
the matters set forth in Sections 5.1, 5.2, clauses
(i), (ii) and (iv) of 5.3, 5.4 and 5.5(a); and
(i) No Person shall have commenced or threatened
to commence any actions or proceedings against a
member of the Del Monte Group that challenges or seeks
(or would challenge or seek) the recovery of a
material amount of damages in connection with the
transactions contemplated hereby and that in DMFC's
reasonable judgment presents a material risk of a
material adverse judgment or ruling against such
member of the Del Monte Group.
ARTICLE X
TERMINATION
10.1 Grounds for Termination. This Agreement may be
terminated at any time prior to the Closing Date:
(a) By the written agreement of each of Purchasers
and DMFC; or
(b) By either Purchasers or DMFC if the Closing shall
not have occurred on or prior to June 30, 1997; or
(c) By Purchasers if, by February 27, 1997, Purchasers
shall not have received, and retain, irrevocable proxies
substantially in the form of Exhibit A-1 hereto from
holders of DMFC Common Stock and DMFC Preferred Stock
holding of record at least 66_% of the shares outstanding
of each Class of DMFC Common Stock and of each Series of
DMFC Preferred Stock (the "66-2/3% Proxies"); provided,
however, if by February 27, 1997 X.X. Xxxx Asset Management
Company indicates its consent to the Merger with respect to
the shares for which it has voting authority and agrees to
use its best efforts to obtain such proxies from the
holders of the shares for which it is the investment
advisor, including recommending that such holders execute
the proxies, X.X. Xxxx Asset Management Company shall have
until March 3, 1997 to deliver such proxies; or
(d) By Purchasers if, by March 21, 1997, Purchasers
shall not have received, and retain, irrevocable proxies
substantially in the form of Exhibit A-1 hereto from
holders of DMFC Common Stock and DMFC Preferred Stock
holding of record at least 90% of the shares outstanding of
DMFC Common Stock and shares of DMFC Preferred Stock
representing at least 90% of the aggregate liquidation
value of all of the DMFC Preferred Stock ; or
(e) By Purchasers, if more than 5% of the shares
outstanding of DMFC Common Stock or shares of DMFC
Preferred Stock representing more than 5% of the aggregate
liquidation value of all of the DMFC Preferred Stock are
Dissenting Shares;
(f) By either DMFC or the Purchasers in the event that
any Judgment or Legal Requirement becomes effective
restraining, enjoining or otherwise prohibiting or making
illegal the consummation of any of the transactions
contemplated by this Agreement, upon notification of the
non-terminating party by the terminating party; or
(g) By any party, at any time, if litigation is
brought or threatened to be brought by any Governmental
Authority for the purpose of restraining, enjoining or
otherwise prohibiting or making illegal the consummation of
any of the transactions contemplated by this Agreement.
10.2 Effect of Termination. If this Agreement is
terminated as permitted under Section 10.1, such termination
shall be without liability of or to any party to this Agreement,
or any Affiliate, stockholder, partner, director, officer,
employee, agent, servant, consultant or representative of such
party, except that termination of this Agreement under this
provision shall not relieve any party from any liability for
breach of this Agreement prior to the date of termination.
Notwithstanding the foregoing, if this Agreement is terminated
pursuant to the provisions set forth herein, the provisions set
forth in Section 8.4 and Article XI shall survive any such
termination.
ARTICLE XI
MISCELLANEOUS
11.1 Non-Survival of Representations and Warranties.
No representation or warranty in this Agreement or in the
schedules or certificates delivered pursuant to this Agreement
shall survive the Closing.
11.2 Publicity. At all times prior to the Closing,
Purchasers, DMFC and the Company shall consult with each other and
cooperate in the preparation of any
press release or other public disclosure about this Agreement or
the proposed transactions contemplated hereby; provided, however,
that if this Agreement is terminated in accordance with its terms
or the Closing otherwise shall not occur, no party shall issue
any press release or make any other public disclosure with
respect to such termination or the transactions contemplated by
this Agreement without the prior written consent of the other
parties hereto; provided further, that any party may make all
disclosures required by any applicable Legal Requirement.
11.3 Costs and Expenses. Except as provided in Section
8.6, whether or not the transactions contemplated by this
Agreement are consummated, each of the parties to this Agreement
shall bear their own expenses incurred in connection with the
negotiation, preparation, execution and closing of this Agreement
and the transactions provided for hereby. Purchasers hereby agree
and acknowledge that, at the Closing, DMFC shall pay (or shall
cause the Company to pay) to Xxxxxx Xxxxxxx all fees and expenses
to which it is entitled in connection with the transactions
contemplated hereby, and shall also pay (or shall cause the
Company to pay) the fees and estimated expenses of DMFC's other
advisors including, without limitation, legal counsel and
accountants. Purchasers agree that the reimbursement of all
additional expenses of the foregoing parties will be made no
later than 25 days following the Closing Date.
11.4 Notices. All notices, requests, consents,
payments, demands, and other communications required or
contemplated under this Agreement shall be in writing and (a)
personally delivered or sent via telecopy (receipt confirmed),
(b) sent by telegram (other than where original payment or other
documents must be delivered) for delivery within 24 hours, or (c)
sent by Federal Express, DHL Worldwide Express, or Airborne
Courier (for next business day delivery), shipping prepaid, as
follows:
If to Parent and/or Sub, to:
Texas Pacific Group
000 Xxxxxxxxxx Xxxxxx, Xxxxx 0000
Xxx Xxxxxxxxx, XX 00000
Attention: Xxxxxxx X. Xxxx, Vice President
Telecopy: (000) 000-0000
with a copy to:
Cleary, Gottlieb, Xxxxx & Xxxxxxxx
Xxx Xxxxxxx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxx X. Xxxx, Esq.
Telecopy: (000) 000-0000
If to DMFC, to:
Del Monte Foods Company
Xxx Xxxxxx
Xxx Xxxxxxxxx, Xxxxxxxxxx 00000
Attention: Xxxxx X. Xxxxxx, Chief Financial Officer
Telecopy: (000) 000-0000
with a copy to:
Attention: Xxxxxxx X. Xxxxxxx, General Counsel
Telecopy: (000) 000-0000
with a copy to:
Proskauer Xxxx Xxxxx & Xxxxxxxxxx LLP
0000 Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxx X. Xxxxxxx, Esq.
Telecopy: (000) 000-0000
or to such other Persons or addresses as any party hereto may
request by notice given as aforesaid. Notices shall be deemed
given and received at the time of personal delivery or completed
telecopying, or, if sent by telegram, 24 hours after the time
sent, or, if sent by Federal Express, DHL Worldwide Express, or
Airborne Courier, one business day after such sending.
11.5 Counterparts. This Agreement may be executed in
any number of counterparts, each of which shall be deemed an
original, but all of which together shall constitute a single
instrument.
11.6 Entire Agreement. This Agreement (including the
exhibits and schedules annexed hereto or referred to herein) and
the Confidentiality Agreement dated October 28, 1996 between the
parties set forth the entire understanding and agreement between
the parties as to the matters covered herein and therein and
supersede and replace any prior understanding, agreement or
statement of intent, in each case, written or oral, of any and
every nature with respect thereto.
11.7 Headings. The headings, section titles and
captions contained in this Agreement or in any schedule or
exhibit annexed hereto or referred to herein, and the table of
contents to this Agreement, are for convenience of reference
only, shall not be deemed a part of this Agreement and do not
qualify or affect in any way the
meaning or interpretation of this Agreement. All references
herein to sections shall be deemed references to such parts of
this Agreement, unless the context otherwise requires.
11.8 Governing Law. This Agreement shall be governed
in all respects, by the laws of the State of New York, including
validity, interpretation and effect, without regard to principles
of conflicts of law, except to the extent that the laws of the
State of Maryland shall specifically and mandatorily apply to the
Merger and the rights of stockholders incident thereto.
11.9 No Third Party Rights; Assignment. This
Agreement, including without limitation Section 7.1 hereof, is
intended to be solely for the benefit of the parties hereto and
is not intended to confer any benefits upon, or create any rights
in favor of, any Person other than the parties hereto, except
that the provisions of Section 7.2 shall be for the benefit of,
and shall be enforceable by each counterparty to the employment
agreements referred to in such Section, and the provisions of
Section 7.3 shall be for the benefit of, and shall be enforceable
by each Indemnified Party. No party hereto may assign this
Agreement or its rights or duties hereunder without the prior
written consent of the other party hereto, which consent shall
not be unreasonably withheld, except that either Purchaser may
assign its rights and duties to an Affiliate of Purchasers
(provided that such assignment shall not release either Purchaser
from its obligations hereunder).
11.10 Waivers and Amendments. This Agreement shall not
be amended or modified except by an instrument in writing signed
by the party against whom enforcement is sought. No waiver shall
be deemed to have been made by any party of any of its rights
under this Agreement unless the same shall be in a writing that
expressly refers to this Section and is signed on its behalf by
its authorized officer. Any such waiver shall constitute a waiver
only with respect to the specific matter described in such
writing and shall in no way impair the rights of the party
granting such waiver in any other respect or at any other time.
No delay on the part of any party in exercising any right, power
or privilege hereunder shall operate as a waiver thereof. The
rights and remedies herein provided are cumulative and are not
exclusive of any rights or remedies that any party may otherwise
have at law or in equity.
11.11 Consent to Jurisdiction. DMFC, Parent and Sub
hereby submit themselves and their respective property in any
action or proceeding relating to this Agreement, or for
recognition and enforcement of any judgment in respect thereof,
to the non-exclusive general jurisdiction of the courts of the
State of New York, the County and City of New York, and the
United States of America in the Southern District of New York,
and the appellate courts thereof. DMFC, Parent and Sub each
consents that any such action or proceeding may be brought in
such courts and waives any objection that it may now or hereafter
have to the venue of any such action or proceeding in any such
court or that such action or proceeding is brought in an
inconvenient court and agrees not to plead or claim the same.
DMFC, Parent and Sub each agrees that service of process in any
such action or proceeding may be effected by mailing a copy
thereof by registered or certified mail (or any substantially
similar form of mail), postage prepaid, to it at the address set
forth in Section 11.4. DMFC, Parent and Sub agree that nothing in
this Section 11.11 shall affect the parties' right to effect
service of process in any other manner permitted by law or shall
limit the right to xxx in any other jurisdiction.
[END OF TEXT]
[SIGNATURE PAGE TO AGREEMENT AND PLAN OF MERGER]
IN WITNESS WHEREOF, this Agreement has been executed
and delivered as of the date first written above.
DEL MONTE FOODS COMPANY TPG PARTNERS, L.P.
By: /s/ Xxxxxx X. Xxxxxxx By: /s/ Xxxxxx Xxxxxxx
-------------------------- ---------------------------
Name: Name:
Title: Title:
TPG SHIELD ACQUISITION
CORPORATION
By: /s/ Xxxxxx Xxxxxxx
---------------------------
Name:
Title:
