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EXHIBIT 2
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ASSET SALE AND PURCHASE
AGREEMENT
BETWEEN
▇▇▇▇▇▇-▇▇▇▇▇▇▇-MIDLAND COMPANY
("SELLER")
AND
WORTHINGTON FOODS, INC.
("BUYER")
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TABLE OF CONTENTS
PAGE
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ARTICLE I. CERTAIN DEFINITIONS ........................................... 1
1.01 Acquired Assets ................................................. 1
1.02 Action .......................................................... 1
1.03 Affiliate ....................................................... 1
1.04 Antitrust Laws .................................................. 2
1.05 Authorization ................................................... 2
1.06 Books and Records ............................................... 2
1.07 Business ........................................................ 2
1.08 Business Day .................................................... 2
1.09 Closing ......................................................... 2
1.10 Closing Date .................................................... 2
1.11 Control ......................................................... 2
1.12 Effective Time .................................................. 3
1.13 Excluded Assets ................................................. 3
1.14 Financial Information ........................................... 3
1.15 Governmental Entity ............................................. 3
1.16 Intellectual Property ........................................... 3
1.17 Inventory ....................................................... 3
1.18 IRS ............................................................. 3
1.19 Knowledge ....................................................... 3
1.20 Manufacturing Agreement ......................................... 3
1.21 Material ........................................................ 3
1.22 Person .......................................................... 4
1.23 Products ........................................................ 4
1.24 Taxes ........................................................... 4
1.25 Technology ...................................................... 4
1.26 Trademarks ...................................................... 4
1.27 Trademark Assignment ............................................ 4
1.28 Transaction Documents ........................................... 4
▇.▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ ................................................... 4
1.30 Other Definitions ............................................... 5
ARTICLE II. PURCHASE AND SALE OF ASSETS .................................. 5
2.01 Sale and Purchase of the Business ............................... 5
2.02 Issuance of the Worthington Shares .............................. 5
2.03 Representations and Warranties of Seller Concerning its Purchase
of the Worthington Shares ..................................... 5
ARTICLE III. CLOSING ..................................................... 6
3.01 Actions to be Taken at Closing .................................. 6
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3.02 Interdependence ................................................. 8
3.03 Time and Place of Closing ....................................... 8
ARTICLE IV. REPRESENTATIONS AND WARRANTIES OF SELLER ..................... 9
4.01 Authority ....................................................... 9
4.02 Authorizations .................................................. 9
4.03 Compliance with Applicable Laws ................................. 9
4.04 Financial Information ........................................... 9
4.05 Finder's Fees and Commissions ................................... 10
4.06 Intellectual Property ........................................... 10
4.07 Litigation and Claims ........................................... 14
4.08 Major Customers ................................................. 14
4.09 Organization and Good Standing .................................. 15
4.10 Permits ......................................................... 15
4.11 Recent Conduct of the Business .................................. 15
4.12 Intentionally Deleted ........................................... 15
4.13 Taxes ........................................................... 15
4.14 Title to Acquired Assets ........................................ 15
4.15 Violations/Breaches ............................................. 16
ARTICLE V. REPRESENTATIONS AND WARRANTIES OF BUYER ....................... 16
5.01 Authority ....................................................... 16
5.02 Authorizations .................................................. 17
5.03 Finder's Fees and Commissions ................................... 17
5.04 Litigation and Claims ........................................... 17
5.05 Organization and Good Standing .................................. 17
5.06 Violations/Breaches ............................................. 17
5.07 Financial Statements ............................................ 17
5.08 SEC Reports ..................................................... 18
5.09 Capitalization of Buyer ......................................... 18
5.10 Worthington Shares .............................................. 18
ARTICLE VI. COVENANTS .................................................... 18
6.01 Access .......................................................... 18
6.02 Additional Documents ............................................ 19
6.03 Additional Records .............................................. 19
6.04 Bulk Transfer Laws .............................................. 19
6.05 Confidentiality ................................................. 19
6.06 Cooperation in Litigation ....................................... 20
6.07 Cooperation in Tax Matters ...................................... 20
6.08 Cooperation of Third Persons .................................... 21
6.09 Covenant Not to Compete ......................................... 21
6:10 Efforts to Close ................................................ 21
6.11 Employees ....................................................... 22
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6.12 Expenses ........................................................ 22
6.13 Intellectual Property Assignment/Recordation/Maintenance ........ 22
6.14 No Shop ......................................................... 22
6.15 Operation of the Business Prior to Closing ...................... 23
6.16 Supplements to Schedules ........................................ 23
6.17 Use of Technology ............................................... 23
6.18 Use of Seller's Name or Reputation/Packaging Materials .......... 24
ARTICLE VII. ADDITIONAL POST-CLOSING AGREEMENTS .......................... 24
7.01 Post-Closing Transition of Business ............................. 24
7.02 Television Advertising .......................................... 24
7.03 Product Development ............................................. 24
7.04 Sales and Marketing Assistance to Buyer ......................... 25
7.05 Trade Support by Seller ......................................... 25
7.06 Manufacturing Transition ........................................ 25
7.07 Registration Rights ............................................. 26
7.08 Purchase of Ingredients from Seller ............................. 26
ARTICLE VIII. CONDITIONS TO SELLER'S OBLIGATION TO CLOSE ................. 26
8.01 Authorizations/Waiting Periods .................................. 26
8.02 No Injunction/Order ............................................. 26
8.03 Performance of Buyer's Obligations .............................. 26
8.04 Buyer's Representations and Warranties True ..................... 26
ARTICLE IX. CONDITIONS TO BUYER'S OBLIGATION TO CLOSE .................... 27
9.01 Authorizations/Waiting Periods .................................. 27
9.02 No Injunction/Order ............................................. 27
9.03 Performance of Seller's Obligations ............................. 27
9.04 Seller's Representations and Warranties True .................... 27
ARTICLE X. INDEMNIFICATION AND ARBITRATION ............................... 27
10.01 Indemnification by Seller ....................................... 27
10.02 Indemnification by Buyer ........................................ 29
10.03 Dispute Resolution .............................................. 31
10.04 Damage Limitations .............................................. 32
10.05 Termination of Indemnification .................................. 32
10.06 Claims Under Manufacturing Agreement ............................ 33
ARTICLE XI. TERMINATION AND ABANDONMENT .................................. 33
11.01 Termination ..................................................... 33
11.02 Procedure and Effect of Termination ............................. 33
ARTICLE XII. MISCELLANEOUS ............................................... 33
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12.01 Amendment and Modification ...................................... 34
12.02 Waiver of Compliance ............................................ 34
12.03 Survival of Representations and Warranties; Other Matters ....... 34
12.04 Notices ......................................................... 34
12.05 Exhibits and Schedules; Incorporation by Reference .............. 35
12.06 Successors and Assigns .......................................... 35
12.07 Entire Agreement ................................................ 36
12.08 Severability .................................................... 36
12.09 Captions ........................................................ 36
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AGREEMENT
This is an ASSET SALE AND PURCHASE AGREEMENT, dated September 28, 1998 by and
between ▇▇▇▇▇▇-▇▇▇▇▇▇▇-Midland Company, a Delaware corporation ("Seller") and
Worthington Foods, Inc., an Ohio corporation ("Buyer"). Each of Seller and Buyer
may hereinafter be referred to as a "Party" or, collectively, as "Parties."
This agreement ("Agreement") sets forth the terms and conditions upon which
Seller will sell to Buyer, and Buyer will purchase from Seller, the Business (as
hereinafter defined).
In consideration of the mutual agreements contained herein, and intending to be
legally bound hereby, the signatories hereto agree as follows:
ARTICLE I
CERTAIN DEFINITIONS
1.01 "ACQUIRED ASSETS" means only the following assets:
(a) the Books and Records;
(b) to the extent transferable without the consent of any third party, all
claims of Seller against third parties exclusively related to the
Acquired Assets, including, without limitation, claims for past
infringement or violation of rights associated with the Intellectual
Property;
(c) goodwill exclusively related to the Business not otherwise
specifically identified herein; and
(d) the Intellectual Property.
Notwithstanding the above, the Acquired Assets do not include any of the
Excluded Assets.
1.02 "ACTION" means any dispute, controversy, claim, action, litigation, suit,
cause of action, arbitration, mediation, or any proceeding by or before any
mediator or Governmental Entity, or any investigation, subpoena, or demand
preliminary to any of the foregoing.
1.03 "AFFILIATE" means, with respect to a Person, another Person that directly,
or indirectly through one or more intermediaries, Controls, or is
Controlled by, or is under common Control with, such Person.
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1.04 "ANTITRUST LAWS" means the ▇▇▇▇▇▇▇ Act (as amended); the ▇▇▇▇▇▇▇ Act (as
amended); the ▇▇▇▇-▇▇▇▇▇-▇▇▇▇▇▇ Antitrust Improvement Act of 1971 (as
amended); the Federal Trade Commission Act (as amended); and all other
statutes, rules, regulations, orders, decrees, administrative and judicial
doctrines, and other laws (whether foreign, federal, state, provincial,
local or other) that are designed or intended to prohibit, restrict or
regulate actions having the purpose or effect of monopolization or
restraint of trade.
1.05 "AUTHORIZATION" means any consent, authorization, approval, order, license,
certificate or permit of or from, or declaration or filing with, any
Governmental Entity, including, without limitation, any required filing
with any Governmental Entity.
1.06 "BOOKS AND RECORDS" means all books, records and other documents
(including, without limitation, customer lists and files; distribution
lists; mailing lists; sales, marketing, promotional and advertising
materials; Seller's pricing information (other than pricing information on
sales of the Products to Pillsbury and pricing information relating to
competitive activities permitted by Seller under Section 6.09 of this
Agreement); operating, production and other manuals; plans; files;
specifications; process drawings; computer programs, data and information;
manufacturing and quality control records and procedures; research and
development files) exclusively related to the Business and existing at the
Effective Time.
1.07 "BUSINESS" means all rights, title and interests related to the
manufacturing, packaging, distributing, marketing and selling of the
Products under the Trademarks or in connection with or pursuant to any
other Intellectual Property, provided that in no event shall the Business
be construed to include the formulation, manufacture, marketing, packaging,
distribution and sale of soy protein, meat substitute products to national
fast food restaurant chains, including McDonalds, Burger King, Taco ▇▇▇▇,
Wendy's and other similar national fast food restaurants or the other
competitive activities permitted by Seller under Section 6.09 of this
Agreement.
1.08 "BUSINESS DAY" means any day on which commercial banks in New York City are
open for business providing substantially all services offered by such
banks.
1.09 "CLOSING" means the closing of the transactions contemplated by this
Agreement in accordance with the terms and upon the conditions set forth in
this Agreement.
1.10 "CLOSING DATE" means the date on which the Closing occurs, as provided in
Section 3.03 of this Agreement.
1.11 "CONTROL" means, with respect to a Person, the ownership by another Person
of greater than 50% of the income or voting interests of such Person, or
such other
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arrangement as constitutes the ability to direct the management or affairs
of such Person.
1.12 "EFFECTIVE TIME" means 9:00 a.m. Eastern Standard Time on the Closing Date.
1.13 "EXCLUDED ASSETS" means any and all assets not expressly listed as Acquired
Assets, whether or not related to the Business.
1.14 "FINANCIAL INFORMATION" means the unaudited customer sales information set
forth in Schedule 1.14.
1.15 "GOVERNMENTAL ENTITY" means any arbitrator, court, judicial, legislative,
administrative or regulatory agency, commission, department, board or
bureau or body or other governmental authority or instrumentality or any
Person or entity exercising executive, legislative, judicial, regulatory or
administrative functions of or pertaining to government, whether foreign,
federal, state, provincial, local or other.
1.16 "INTELLECTUAL PROPERTY" means the Trademarks and the Technology, and such
other trade names, service marks, brand names, copyrights, slogans, rights
to trade dress, labels, advertising and designs, whether or not registered,
as are owned as of the date hereof by Seller and are exclusively related to
the Business, as well as all the registrations and applications for the
foregoing, or, if not owned by Seller, that Seller has the right (whether
with or without the consent of the owner thereof) to assign, license or
sublicense to Buyer that are utilized exclusively in connection with the
Business.
1.17 "INVENTORY" means the finished goods inventory relating to the Products
manufactured by the Seller for the Pillsbury Company pursuant to the
Agreement between the Seller and Pillsbury dated October 1,1995.
1.18 "IRS" means the United States Internal Revenue Service.
1.19 "KNOWLEDGE" means, in the case of an entity, the actual knowledge of the
officers of such entity after reasonable investigation.
1.20 "MANUFACTURING AGREEMENT" means the Manufacturing Agreement between Buyer
and Seller in the form attached hereto as Exhibit 1.20.
1.21 "MATERIAL" and its variations mean, with respect to an item, event,
circumstance or condition, that such item, event, circumstance or
condition, individually or in the aggregate, is reasonably likely to have a
substantially adverse effect upon the assets, operations, financial
condition or earnings of the Business.
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1.22 "PERSON" means (as the context requires) an individual, a corporation, a
partnership, an association, a trust, a limited liability company, or other
entity or organization, including a Governmental Entity.
1.23 "PRODUCTS" means the products described in SCHEDULE 1.23.
1.24 "TAXES" means all foreign, federal, state, provincial, local or other
taxes, fees, levies, duties or other assessments or charges of whatever
kind (including, without limitation, income, sales, use, transfer, excise,
stamp, property, value added, recording, registration, intangible,
documentary, goods and services, real estate, sales, payroll, gains, gross
receipts, withholding, and franchise taxes) imposed by the United States or
any state, county or local government, subdivision or agency thereof, or
any other jurisdiction outside the United States. Such term will include
any interest, penalties, or additions payable in connection with such
taxes, fees, levies, duties or other assessments or charges.
1.25 "TECHNOLOGY" means all of Seller's know-how, patented and unpatented
formulas (including, without limitation, current and discontinued flavors
and products, recipes and mixing instructions), improvements, trade
secrets, research and results thereof, inventions, data, methods,
processes, instructions, drawings, and specifications that are used for the
production of the Products or otherwise used directly in the Business.
Technology shall not be construed to include any rights or information with
respect to formulation or manufacture of ingredients used to produce the
Products.
1.26 "TRADEMARKS" means those trademarks, registrations and applications
therefor that are set forth in SCHEDULE 1.26.
1.27 "TRADEMARK ASSIGNMENT" means the overall assignment of the Trademarks to
Buyer from Seller, which will be in the form attached as EXHIBIT 1.27 or in
such other form as agreed to in writing by Seller and Buyer. Individual
Trademark assignment documents, by country, will be prepared and filed as
stated in Section 6.13 of this Agreement.
1.28 "TRANSACTION DOCUMENTS" means collectively (a) this Agreement; (b) the
Manufacturing Agreement; and (c) the Trademark Assignment, ▇▇▇▇ of Sale and
any other transaction document executed and delivered by Seller or Buyer to
the other Party at the Closing. The phrase "the consummation of the
transactions contemplated by this Agreement" or such similar phrases
includes the execution and delivery of these Transaction Documents.
1.29 "UNITED STATES" means the United States of America.
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1.30 OTHER DEFINITIONS. Other terms defined in this Agreement, and the location
where they are defined, are:
Location
--------
"Act" ............................ Section 2.03
"▇▇▇▇ of Sale" ................... Section 3.01(a)(i)
"Exchange Act" ................... Section 5.08
"Financial Statements" ........... Section 5.07
"SEC" ............................ Section 5.08
"SEC Reports" .................... Section 5.08
"Securities Act" ................. Section 2.03
"Worthington Shares" ............. Section 2.02
ARTICLE II
PURCHASE AND SALE OF ASSETS
2.01 SALE AND PURCHASE OF THE BUSINESS. In accordance with the terms and upon
the conditions of this Agreement, at the Closing Seller will sell, convey,
assign, transfer and deliver to Buyer the Acquired Assets, and Buyer will
purchase, acquire and accept, the Acquired Assets. Anything contained in
this Agreement or in any of the other Transaction Documents to the contrary
notwithstanding, Buyer will not assume pursuant to this Agreement or any of
the other Transaction Documents any liabilities or obligations of Seller or
any other Person, whether or not relating to the Business.
2.02 ISSUANCE OF THE WORTHINGTON SHARES. Upon the terms and subject to the
conditions of this Agreement, as consideration for the sale of the Acquired
Assets to Buyer, Buyer shall deliver to Seller at the Closing a number of
duly authorized, validly issued, fully paid and nonassessable common shares
of Buyer (the "Worthington Shares") determined by dividing $9,300,000 by
the arithmetic average of the per share closing price of the common shares
of Buyer as reported in The Wall Street Journal, Midwest Edition for each
of the twenty (20) trading days immediately prior to the Closing; provided,
however, that the number of Worthington Shares shall not be more than
581,250.
2.03 REPRESENTATIONS AND WARRANTIES OF SELLER CONCERNING ITS PURCHASE OF THE
WORTHINGTON SHARES. Seller represents and warrants to Buyer that:
(a) It will acquire the Worthington Shares solely for investment purposes
and not with a view to the distribution thereof in violation of
applicable securities laws.
(b) It is an "accredited investor" within the meaning of Rule 501 of the
General Rules and Regulations under the Securities Act of 1933, as
amended (the "Securities Act").
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(c) It recognizes and agrees that the certificates representing the
Worthington Shares may be subject to appropriate stop transfer
instructions to be given by Buyer to its transfer agent and shall have
endorsed thereon a legend substantially as follows:
The shares represented by this certificate have not been
registered under the Securities Act of 1933, as amended (the
"Act"), or under any applicable state law, and may not be
transferred without registration under the Act or such applicable
state law unless an exemption from registration is available
thereunder.
(d) It understands that the Worthington Shares may not be sold,
transferred or otherwise disposed of without registration under the
Act or an available exemption therefrom.
ARTICLE III
CLOSING
3.01 ACTIONS TO BE TAKEN AT CLOSING. At the Closing, the following actions will
be taken:
(a) Seller will deliver to Buyer, duly executed, the following:
(i) a ▇▇▇▇ of sale (the "▇▇▇▇ of Sale") in the form attached as
EXHIBIT 3.01 (a)(i) or in such other form as agreed to in writing
by Seller and Buyer for those Acquired Assets that will not be
transferred pursuant to specific documents described elsewhere in
this Section 3.01(a);
(ii) a certificate by the President or Vice-President of Seller, in a
form reasonably acceptable to Buyer, to the effect that, to the
Knowledge of Seller, the warranties and representations set forth
in Section 2.03 and in Article IV of this Agreement are true and
correct in all material respects, and that all representations
and warranties set forth in Article IV of this Agreement that are
qualified as to materiality are true in all respects, as of the
Closing;
(iii) a short-form certificate of good standing and certificate of
incorporation of Seller, in each case certified by the Secretary
of State of the State of Delaware as of a date no more than 5
Business Days prior to the Closing Date;
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(iv) an assignment of the copyrights set forth in SCHEDULE 3.01
(a)(iv) in such other form as agreed to in writing by Seller and
Buyer;
(v) an opinion of Seller's counsel with respect to the due
authorization, execution and delivery of the Transaction
Documents by Seller and the enforceability of the Transaction
Documents against Seller in form reasonably satisfactory to
Buyer;
(vi) certified copies of any resolutions by Seller's board of
directors, or any other necessary corporate actions of Seller,
authorizing the execution and performance of this Agreement, the
other Transaction Documents and the consummation of the
transactions contemplated hereby and thereby;
(vii) the Trademark Assignment;
(viii) assignments for the Trademarks in a form suitable for recording
with the appropriate Governmental Entities, including proper
notarization, authentication, legalization, execution and/or
consularization by Seller, if needed;
(ix) an agreement in form reasonably satisfactory to Buyer between
Seller and The Pillsbury Company ("Pillsbury"), pursuant to
which, among other things, (a) the Agreement dated October 1,
1995 between Seller and Pillsbury, pursuant to which Pillsbury
marketed and distributed the Products, is terminated, (b)
Pillsbury agrees to permit Producer to insert into packages of
the Harvest Burger Products produced by Producer through December
31, 1998 a coupon and other information about the intended
changes in distribution of the Products, (c) Pillsbury agrees
that no Products shall be shipped by it after December 31, 1998
so long Seller notifies Pillsbury prior to such date the Seller
or its designee shall begin distribution of the Products without
the Green Giant trademarks, trade dress or UPC and (d) Pillsbury
agrees to cooperate in the orderly transition of the sales and
distribution functions related to the Products;
(xi) such other documents as are, in the reasonable opinion of counsel
for Seller and Buyer, necessary or advisable to transfer the
Acquired Assets to Buyer.
(b) Buyer will deliver to Seller, duly executed, the following:
(i) a certificate by the President or Vice-President of Buyer, in a
form reasonably acceptable to Seller, to the effect that, to the
Knowledge of Buyer, the warranties and representations set forth
in
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Article V of this Agreement are true and correct in all material
respects, and that all representations and warranties set forth
in Article V of this Agreement that are qualified as to
materiality are true in all respects, as of the Closing;
(ii) a short-form certificate of good standing and certificate of
incorporation of Buyer, in each case certified by the Secretary
of State of the State of Ohio as of a date no more than 5
Business Days prior to the Closing Date;
(iii) an opinion of Buyer's counsel with respect to the due
authorization, execution and delivery of the Transaction
Documents by Buyer to which it is a party, the enforceability of
such Transaction Documents against Buyer and the status of the
Worthington Shares in form reasonably satisfactory to Seller;
(iv) certificates for the Worthington Shares, delivered as described
in Section 2.02;
(v) a receipt for the Acquired Assets in such form as agreed to by
Seller and Buyer; and
(vi) certified copies of any resolutions by Buyer's board of
directors, or any other necessary corporate actions of Buyer,
authorizing the execution and performance of this Agreement, the
other Transaction Documents and the consummation of the
transactions contemplated hereby and thereby.
(c) Seller and Buyer concurrently will duly execute and deliver to each
other:
(i) a certificate of its Secretary or an Assistant Secretary as to
the incumbency of all officers executing documents in connection
with the Transaction Documents; and
(ii) the Manufacturing Agreement.
3.02 INTERDEPENDENCE. The transfers and deliveries described in this Article Ill
are mutually interdependent and are to be regarded as occurring
simultaneously as of the Effective Time. Unless agreed to in writing by
Seller and Buyer, no such transfer or delivery will become effective until
all other transfers and deliveries provided for in this Article Ill have
also become effective.
3.03 TIME AND PLACE OF CLOSING. Subject to the satisfaction or waiver of all of
the conditions set forth in Articles VII and VIII, the Closing will take
place at the offices of Buyer's counsel, Vorys, ▇▇▇▇▇, ▇▇▇▇▇▇▇ and ▇▇▇▇▇
LLP, at 10:00 a.m. local time on the later of October -16, 1998 or 5
Business Days after receipt of all
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Authorizations necessary to consummate the sale by Seller and the purchase
by Buyer, of the Acquired Assets, or on such other date as may be mutually
agreed to in writing by Seller and Buyer.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF SELLER
Seller represents and warrants that the following are true and correct as of the
date of this Agreement, and will be true and correct as of the Closing:
4.01 AUTHORITY. Seller has full corporate power and authority to execute and
deliver this Agreement and each of the other Transaction Documents to which
it is a party and to consummate the transactions contemplated hereby and
thereby. All corporate actions and proceedings on the part of Seller that
are necessary to approve and authorize the execution and delivery of this
Agreement and each of the other Transaction Documents to which it is a
party and the consummation of the transactions contemplated hereby and
thereby have, or prior to Closing will have, occurred, and, assuming proper
execution and delivery by Buyer, this Agreement is enforceable against
Seller in accordance with its terms and each of the other Transaction
Documents to which it is a party will be so enforceable upon proper
execution and delivery to Buyer.
4.02 AUTHORIZATIONS. No Authorization is needed by Seller for the execution,
delivery, or performance of this Agreement or any of the other Transaction
Documents to which it is a party and the consummation of the transactions
contemplated hereby and thereby, except as set forth in SCHEDULE 4.02 or
where the failure to obtain such Authorization will not have a material
adverse effect on the Business, the Products, this Agreement or the
consummation of the transactions contemplated hereby.
4.03 COMPLIANCE WITH APPLICABLE LAWs. Except as set forth in SCHEDULE 4.03, to
the Knowledge of Seller, the Business is being conducted in compliance in
all Material respects with all statutes, laws, ordinances, rules, orders,
and regulations and, since January 1, 1997, Seller has not received any
written communication from a Governmental Entity or other Person that
alleges the Business or the Products are not in such compliance. The
Products and the packaging, advertising and promotion of the Products are
in all Material respects in compliance with the United States Federal Food,
Drug and Cosmetic Act, including the Nutrition Labeling and Education Act
of 1990 and the regulations issued thereunder.
4.04 FINANCIAL INFORMATION. The Financial Information has been derived from the
accounting books and records of Seller used as a basis for the preparation
of the consolidated financial statements of Seller and presents fairly in
all Material
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respects the customer sales information for the Business on the basis
described in SCHEDULE 1.14 for the periods covered by such Schedule, in
accordance with past practices consistently applied.
4.05 FINDER'S FEES AND COMMISSIONS. Seller has no liability or obligation to pay
any fees or commissions to any broker, finder or other agent with respect
to the transactions contemplated by this Agreement for which Buyer could
become liable or obligated.
4.06 INTELLECTUAL PROPERTY.
(a) Trademarks
(i) Except as set forth in SCHEDULE 4.06(a)(i), the Trademarks
listed on SCHEDULE 1.26 comprise all the trademarks registered in
the United States and any other country that contain the "Harvest
Burgers" name as well as all the trademarks registered in the
United States or in any other country that are in current use in
the Business.
(ii) Except as set forth in SCHEDULE 4.06(a)(ii), Seller owns all
Trademarks that use the "Harvest Burgers" name, as well as all
the Trademarks in current use in the Business (whether or not
they use the Harvest Burgers name), free and clear of any
security interests, liens, pledges, claims, charges, licenses or
options.
(iii) Except as set forth in SCHEDULE 4.06(a)(iii), Seller is the owner
of record title of all the Trademarks, not as a nominee or agent
of any third party.
(iv) Except as set forth in SCHEDULE 4.06(a)(iv), each of the
Trademark registrations is valid and subsisting in the territory
in which such Trademark is registered for use on the products for
which such Trademark is currently being used in the Business.
(v) Except as set forth in SCHEDULE 4.06(a)(v):
(A) no claims are currently being asserted against Seller, any
Affiliate of Seller or any licensee of Seller (including
Pillsbury) by any person regarding the use of any
Trademarks, or challenging or questioning the validity of
any Trademarks;
(B) to the Knowledge of Seller, the use of the Trademarks, by
Seller, any Affiliate of Seller or any licensee of the
Seller
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(including Pillsbury) does not infringe on any trademark,
trade name or service ▇▇▇▇ of any third party; and
(C) no Actions are pending or, to the Knowledge of Seller,
threatened against Seller or any Affiliate of Seller or any
licensee of the Seller (including Pillsbury) with respect to
the Trademarks.
(vi) Except as set forth on SCHEDULE 4.06(vi):
(A) the Trademarks are owned and used exclusively by Seller and
there are no licenses, sublicenses, assignments, agreements,
undertakings, restrictions or joint ownership agreements
currently in effect pertaining to any of the Trademarks to
which Seller or any Affiliate of Seller is a party, other
than any intercompany licenses which will be terminated as
of the Closing Date and a license to Pillsbury, which will
be terminated in accordance with the provisions of this
Agreement; and
(B) no third party will have a right to use, license, terminate
a license or acquire any of the Trademarks as a consequence
of the consummation of the transactions contemplated by this
Agreement.
(vii) Except as set forth in SCHEDULE 4.06(a)(vii), no consent of
any third party will be required for the use of any
Trademark as a result of the consummation of the
transactions contemplated by this Agreement.
(viii) Except as set forth in SCHEDULE 4.06(a)(viii), there are no
common law or state-registered trademarks that contain the
Harvest Burgers name which are used by Seller or any
Affiliate of Seller in the United States or in any other
country other than exclusively in connection with the
Business.
(b) TECHNOLOGY
(i) Except as set forth in SCHEDULE 4.06(b)(i), the Technology
comprises all of Seller's process knowledge necessary for
Seller's conduct of the Business.
(ii) Except as set forth in SCHEDULE 4.06(b)(ii), there are no
security interests, liens, pledges, claims, charges, licenses or
options on Technology.
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(iii) Except as set forth in SCHEDULE 4.06(b)(iii):
(A) no claims are currently being asserted against Seller or any
Affiliate of Seller by any Person regarding the use of any
Technology; or challenging or questioning Seller's ownership
or right to use any Technology;
(B) the use of such Technology does not infringe on any patent
of any third party; and
(C) no Actions are pending or, to the Knowledge of Seller,
threatened against Seller or any Affiliate of Seller with
respect to the use of Technology.
(iv) Except as set forth in SCHEDULE 4.06(b)(iv):
(A) the Technology is owned and used exclusively by Seller and
there are no licenses, sublicenses, assignments or joint
ownership agreements currently in effect pertaining to use
of any of the Technology to which Seller or any Affiliates
of Seller is a party, other than any intercompany licenses
which will be terminated as of the Closing Date; and
(B) no third party will have a right to use, license, terminate
a license or acquire any of the Technology as a consequence
of the consummation of the transactions contemplated by this
Agreement.
(v) No consent of any third party will be required for the use of any
Technology by Buyer as a result of the consummation of the
transactions contemplated by this Agreement.
(vi) Seller and its Affiliates have taken reasonable steps in
accordance with customary industry standards to maintain the
confidentiality of the Technology and to maintain and protect the
Technology.
(c) MISCELLANEOUS INTELLECTUAL PROPERTY
(i) Except as set forth in SCHEDULE 4.06(c)(i), the Intellectual
Property (including the Trademarks and the Technology, above)
comprises all of Seller's intellectual property necessary for
Seller's conduct of the Business as it is currently conducted.
(ii) Except as set forth in SCHEDULE 4.06(c)(ii), Seller owns all the
Intellectual Property (except for the Trademarks and the
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Technology, which are addressed in Section 4.06(a) and 4.06(b)
above).
(iii) Except as set forth in SCHEDULE 4.06(c)(iii):
(A) no claims are currently being asserted against Seller or any
Affiliate of Seller by any person regarding the use of any
Intellectual Property (except for the Trademarks and the
Technology, which are addressed in Section 4.06(a) and
4.06(b) above), or challenging or questioning the validity
of any license or agreement relating to the use of any
Intellectual Property (except for the Trademarks and the
Technology, which are addressed in Section 4.06(c) and
4.06(b) above);
(B) to the knowledge of Seller, the use of such Intellectual
Property (except for the Trademarks and the Technology,
which are addressed in Section 4.06(a) and 4.06(b) above),
by Seller or any Affiliate of Seller does not infringe on
any trademark, trade name or service ▇▇▇▇ of any third
party; and
(C) no Actions are pending or, to the Knowledge of Seller,
threatened against Seller or any Affiliate of Seller with
respect to the Intellectual Property (except for the
Trademarks and the Technology, which are addressed in
Section 4.06(a) and 4.06(b) above).
(iv) Except as set forth on SCHEDULE 4.06(c)(iv):
(A) there are no licenses, sublicenses, assignments, agreements,
undertakings, restrictions or joint ownership agreements
currently in effect pertaining to any of the Intellectual
Property (except for the Trademarks and the Technology,
which are addressed in Section 4.06(a) and 4.06(b) above) to
which Seller or any Affiliate of Seller is a party, other
than any intercompany licenses which will be terminated as
of the Closing Date; and
(B) no third party will have a right to use, license, terminate
a license or acquire any of the Intellectual Property
(except for the Trademarks and the Technology, which are
addressed in Section 4.06(a) and 4.06(b) above) as a
consequence of the consummation of the transactions
contemplated by this Agreement.
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(v) No consent of any third party will be required for the use of any
Intellectual Property (except for the Trademarks and the
Technology, which are addressed in Section 4.06(a) and 4.06(b)
above) as a result of the consummation of the transactions
contemplated by this Agreement.
4.07 LITIGATION AND CLAIMS. Except as set forth in Schedule 4.07, there are no
pending Actions relating to the Business or the Products with respect to
which Seller or any of its Affiliates, or to the Knowledge of Seller,
Pillsbury, has received service of process or has been threatened in
writing and which:
(a) involve a claim against Seller, any of its Affiliates or Pillsbury of,
or which involve any unspecified amount which is reasonably expected
to result in a liability to Seller, any of its Affiliates or Pillsbury
of, more than fifty thousand United States dollars (US $50,000);
(b) seek injunctive relief which would Materially affect Buyer's
acquisition, ownership or operation of the Acquired Assets or the
Business or its marketing and sale of the Products; or
(c) directly relate to the transactions contemplated by this Agreement.
Except as set forth in SCHEDULE 4.07, there are no:
(d) outstanding judgments, orders, writs, injunctions or decrees of any
Governmental Entity against Seller or any of its Affiliates which have
or are reasonably expected to have a material adverse effect on the
ability of Seller to consummate the transactions contemplated by this
Agreement or to have a material adverse effect on Buyer's ownership or
operation of the Acquired Assets or the Business or its marketing and
sale of the Products;
(e) Actions pending or, to the Knowledge of Seller, threatened against
Seller or any of its Affiliates which have or are reasonably expected
to have a material adverse effect on the ability of Seller to
consummate the transactions contemplated by this Agreement or to have
a material adverse effect on Buyer's ownership or operation of the
Acquired Assets or the Business or its marketing and sale of the
Products).
Except as set forth in SCHEDULE 4.07, to the Knowledge of Seller, neither
Seller nor Seller's Affiliates is in Material default under any judgment,
order or decree of any Governmental Entity applicable to the Business, the
Acquired Assets or the Products.
4.08 MAJOR CUSTOMERS. To the Knowledge of Seller, since January 1,1998, neither
Seller nor Pillsbury has received oral or written notice from any of its
top 10
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customers of either party related to the Business (as measured by sales
volume during calendar year ended December 31, 1997) expressing its current
intention to terminate 25% or more of its purchases of the Products.
4.09 ORGANIZATION AND GOOD STANDING. Seller is a corporation duly organized,
validly existing, and in good standing under the laws of the State of
Delaware and has full corporate power to own its properties and conduct the
Business presently being conducted by it, except where not Material. Seller
is duly licensed or qualified to transact business in each state or other
jurisdiction in which the Business is currently transacted and applicable
laws require such licensing or qualification.
4.10 PERMITS. To the Knowledge of Seller, Seller possesses all licenses, permits
and other approvals of Governmental Entities necessary to enable it to
carry on the Business as it is currently conducted, except where not
Material.
4.11 RECENT CONDUCT OF THE BUSINESS. From January 1,1998, until the date of this
Agreement, Seller has conducted the Business in all Material respects in
the same manner as it has historically been conducted by Seller since
January 1, 1994, and there has been no Material change in the Business,
except for changes attributable to general economic conditions or relating
to the consumer or food products industries generally or changes resulting
from actions of Buyer or the announcement of the transactions contemplated
by this Agreement.
4.12 INTENTIONALLY DELETED.
4.13 TAXES. All returns, reports and declarations of every nature required to be
filed with respect to Taxes by or on behalf of Seller (either separately or
as part of a consolidated group) prior to the Closing Date with respect to
the Business have been timely filed (taking into account any extensions)
and such returns, reports and declarations as so filed are complete and
accurate and disclose all Taxes required to be paid for the periods covered
thereby, except for any such failures to file and such errors which would
not be Material.
4.14 TITLE TO ACQUIRED ASSETS. Seller has and will convey to Buyer good and
marketable title to all of the Acquired Assets free and clear of any
security interests, liens, pledges, claims, charges or options, except:
(a) as set forth in SCHEDULE 4.14 and
(b) imperfections of title, security interests, liens, pledges, claims,
charges or options, if any, which do not, individually or in the
aggregate, materially impair the continued use and operation of the
Acquired Assets to which they relate in the operation of the Business
as currently conducted or reduce in any material respect the value of
the Acquired Assets to Buyer (collectively, the "Permitted Liens");
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provided, however, that this representation and warranty will not apply to
any Intellectual Property.
4.15 VIOLATIONS/BREACHES. Except as set forth in SCHEDULE 4.15, or where not
Material, the execution, delivery and compliance with this Agreement and
each of the other Transaction Documents to which it is a party by Seller
will not, and the consummation by Seller of the transactions contemplated
by this Agreement and each of the other Transaction Documents to which it
is a party will not, conflict with, or result in any violation of or
default under, or give rise to a right of termination, cancellation or
acceleration of any obligation or to loss of a benefit under, or result in
the creation of any lien, claim, encumbrance, security interest, option,
charge or restriction of any kind upon any of the Acquired Assets under, or
require any consent, authorization or approval under:
(a) any provision of the certificate of incorporation or by-laws of
Seller;
(b) any Material Agreement or permit to which Seller is a party or by
which any of the Acquired Assets may be bound; or (c) to the Knowledge
of Seller, any judgment, order or decree or any statute, rule,
regulation, order, decree, administrative or judicial doctrine, or
other law (whether foreign, federal, state, provincial, local or
other) binding on or applicable to Seller, the Products, the Business
or any of the Acquired Assets.
ARTICLE V
REPRESENTATIONS AND WARRANTIES OF BUYER
Buyer represents and warrants that the following are true and correct as of the
date of this Agreement, and will be true and correct as of the Closing.
5.01 AUTHORITY. Buyer has full corporate power and authority to execute and
deliver this Agreement and to consummate the transactions contemplated
hereby. All corporate actions and proceedings on the part of Buyer that are
necessary to approve and authorize the execution and delivery of this
Agreement and each of the other Transaction Documents to which it is a
party and the consummation of the transactions contemplated hereby and
thereby have, or prior to Closing will have, occurred, and, assuming proper
execution and delivery by Seller, this Agreement is enforceable against
Buyer in accordance with its terms and such other Transaction Documents
will be so enforceable upon proper execution and delivery to Seller.
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5.02 AUTHORIZATIONS. Except for Authorization from NASDAQ National Market System
related to the approval of the issuance of the Worthington Shares, no
Authorization is needed by Buyer for the execution, delivery, or
performance of this Agreement or any of the other Transaction Documents to
which it is a party and the consummation of the transactions contemplated
hereby and thereby, except as set forth in SCHEDULE 5.02 or where the
failure to obtain such Authorization will not have a material adverse
effect on the Business, the Products, this Agreement or the consummation of
the transactions contemplated hereby.
5.03 FINDER'S FEES AND COMMISSIONS. Neither Buyer nor its Affiliates have any
liability or obligation to pay any fees or commissions to any broker,
finder or other agent with respect to the transactions contemplated by this
Agreement for which Seller or any Affiliate of Seller could become liable
or obligated.
5.04 LITIGATION AND CLAIMS. There are no pending Actions relating to the
Business with respect to which Buyer has received service of process or has
been threatened in writing and which: (a) seek injunctive relief which
would Materially affect Buyer's acquisition, ownership or operation of the
Acquired Assets or its marketing and sale of the Products; or (b) directly
relate to the transactions contemplated by this Agreement. There are no:
(c) outstanding judgments, orders, writs, injunctions or decrees of any
Governmental Entity against Buyer which have or could reasonably be
expected to have a material adverse effect on the ability of Buyer to
consummate the transactions contemplated by this Agreement; or (d) Actions
pending or, to the Knowledge of Buyer, threatened against Buyer which have
or could reasonably be expected to have a material adverse effect on the
ability of Buyer to consummate the transactions contemplated by this
Agreement or any of the other Transaction Documents to which it is a party
or to conduct the Business after the Closing.
5.05 ORGANIZATION AND GOOD STANDING. Buyer is a corporation duly organized,
validly existing, and in good standing under the laws of the State of Ohio.
5.06 VIOLATIONS/BREACHES. Except where not Material, the execution, delivery and
compliance with this Agreement and each of the other Transaction Documents
to which it is party by Buyer will not, and the consummation by Buyer of
the transactions contemplated by this Agreement and each of the other
Transaction Documents to which it is a party will not, conflict with, or
result in any violation of or default under, or require any consent,
authorization or approval under: (a) any provision of the articles of
incorporation or code or regulations of Buyer; (b) any material contract to
which Buyer is a party; or (c) to the Knowledge of Buyer, any judgment,
order or decree or any statute, law, rule or regulation binding on or
applicable to Buyer.
5.07 FINANCIAL STATEMENTS. Buyer has delivered to Seller: (a) audited balance
sheets of Buyer as at December 31, in each of the years 1995, 1996 and
1997,
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and the related audited statements of income for each of the years then
ended (the "Financial Statements"), and (b) an unaudited balance sheet of
Buyer as at June 30, 1998, and the related unaudited statement of income
for the six (6) month period then ended. Such financial statements fairly
present in all material respects the financial condition and results of
operations of Buyer as at the respective dates of and for the periods
referred to in such financial statements in accordance with GAAP. Any
interim financial statements are further subject to normal recurring year
end adjustments (none of which, individually or in the aggregate, shall be
material) and the absence of footnotes.
5.08 SEC REPORTS. Since January 1,1997, Buyer has timely filed with the
Securities and Exchange Commission ("SEC") all materials and documents
required to be filed by it under the Exchange Act. (All the materials and
documents filed with the SEC by Buyer since January 1,1997, are hereinafter
referred to as the "SEC Reports.") The SEC Reports, copies of which have
been delivered to Seller, are true and correct in all material respects,
including the financial statements and other financial information
contained therein, and do not omit to state any material fact necessary to
make the statements in such SEC Reports, in light of the circumstances in
which they were made, not misleading.
5.09 CAPITALIZATION OF BUYER. SCHEDULE 5.09 hereto sets forth the authorized
capitalization of Buyer and the number of shares of each class of stock of
Buyer issued and outstanding thereof. All of such issued and outstanding
shares have been duly authorized and validly issued, are fully paid and
nonassessable and free of any claims of preemptive rights. Other than as
set forth in SCHEDULE 5.09 or as created pursuant to this Agreement or
stock option plans adopted prior to the date hereof by the Company and
reflected in the Financial Statements and preferred stock purchase rights
issued pursuant to a Shareholder Rights Plan, there are no outstanding
subscriptions, options, warrants, rights, convertible or exchangeable
securities or other agreements of any character relating to the issued or
unissued capital stock of the Company obligating it to issue additional
shares of capital stock.
5.10 WORTHINGTON SHARES. When delivered to Seller pursuant to the terms and
conditions of this Agreement, the Worthington Shares will be duly
authorized, fully paid and nonassessable common shares, without par value,
of Buyer.
ARTICLE VI
COVENANTS
6.01 ACCESS. From the date of this Agreement through the Closing, Seller will
permit Buyer, its employees, counsel and accountants to have reasonable
access, during normal business hours and upon reasonable notice, to the
personnel, properties, books and records of Seller relating to the
Business; provided,
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however, that such access must not unreasonably interfere with the normal
operations of Seller or the Business.
6.02 ADDITIONAL DOCUMENTS. From time to time after the Closing, Seller and Buyer
will execute and deliver, without further consideration, such documents as
either Party may reasonably request, in such form as may be appropriate, if
necessary or advisable in connection with the consummation of the
transactions contemplated by this Agreement and the other Transaction
Documents.
6.03 ADDITIONAL RECORDS. Within a reasonable time (but not more than 45 days)
after Closing, Seller will provide to Buyer copies of books, records or
other documents, if any, which were not exclusively related to the Business
but which are necessary for the operation of the Business. Seller and its
Affiliates may redact from such copies any information that does not relate
to the Business, and Buyer will have the right to use such copies only in
connection with its operation and ownership of the Business and its
marketing and sale of the Products.
6.04 BULK TRANSFER LAWS. Buyer waives compliance by Seller with any laws
relating to bulk transfers and bulk sales applicable to the transactions
contemplated by this Agreement. Seller will indemnify Buyer from any third
party Actions arising out of or related to the failure of Seller to comply
with such bulk transfer and bulk sales laws.
6.05 CONFIDENTIALITY.
(a) Buyer and Seller will each hold in strict confidence and not use for
its own benefit the documents and information furnished concerning the
other party, its assets, properties, the Products and Business. If the
transactions contemplated by this Agreement shall not be consummated,
such confidence shall be maintained and all such documents and all
copies thereof shall immediately thereafter be returned to the party
from whom received or, at the written request of such party from whom
received, destroyed.
(b) Except as otherwise expressly permitted by this Agreement, Seller and
Buyer will not disclose the terms of the Transaction Documents to any
Person other than such directors, officers, shareholders, employees,
attorneys and accountants of Seller and Buyer and their financial
advisors, or such other Persons acting on behalf of or in the
interests of Seller and Buyer to whom disclosure of the terms of this
Agreement is necessary for the consummation of the transactions
contemplated hereby or the operation of the Business before or after
the Closing or the operation of Seller's or Buyer's business
otherwise. Any disclosure permitted by this Section 6.05(b) will be
made on a confidential basis.
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(c) Notwithstanding anything to the contrary in this Agreement, Seller and
Buyer may disclose the terms of this Agreement to any Person, whether
by providing such Person with photocopies of all or portions thereof
or otherwise: (i) to the extent required by applicable laws, rules or
regulations; (ii) as may be required in the reasonable opinion of
Seller or Buyer, as the case may be, in connection with the
consummation of the transactions contemplated by this Agreement; (iii)
as may be required, in the reasonable opinion of Seller or Buyer, as
the case may be, in the defense of Seller or Buyer in any Action; or
(iv) as may be legally required, in the reasonable opinion of counsel
to Buyer or Seller, in any filings under the Act or the Exchange Act.
(d) Any press releases, public announcements or similar publicity with
respect to this Agreement or the transactions contemplated hereby must
be approved by both Seller and Buyer in advance, provided that such
approval may not be unreasonably withheld or delayed, and further
provided that nothing herein will prevent either Seller or Buyer, upon
reasonable notice to the other, from making public announcements to
comply with the requirements of law or any listing agreement with any
securities exchange or NASDAQ or to inform their respective employees
of the transactions contemplated by this Agreement.
(e) Subject to the principles set forth in Section 6.05(c)(i) (except for
applicable laws, rules or regulations related to the SEC and Section
6.05(c)(iii)), Buyer will not disclose, and will cause its employees,
counsel and accountants not to disclose, to any Person, any
information relating to the cost structure of the Business as
conducted by the Seller that is made available to Buyer, its
employees, counsel or accountants. Buyer will be responsible for any
breach of this Section 6.05(e) by any of Buyer's employees, counsel,
accountants or other advisors.
6.06 COOPERATION IN LITIGATION. Seller, and Buyer will, in the defense of any
third-party Action relating to the Business or the Products, make available
during normal business hours, but without unreasonably disrupting their
respective businesses, all personnel and records of the Business and the
Products reasonably necessary to permit the effective defense or
investigation of such Action. If business information other than that
pertaining to the Business or the Products, is contained in such records,
Seller and Buyer will either agree that such information may be omitted or
red acted by the producing Party, or will enter into appropriate secrecy
commitments to protect such information.
6.07 COOPERATION IN TAX MATTERS. Seller and Buyer will make available during
normal business hours, but without unreasonably disrupting their respective
businesses, all personnel and records of the Business reasonably necessary
in connection with: the filing of any Tax return, amended return or claim
for refund;
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determining a liability for Taxes or a right to refund for Taxes; or
conducting an audit or other proceeding in respect of Taxes.
6.08 COOPERATION OF THIRD PERSONS. Where the cooperation of third Persons such
as insurers or trustees would be necessary in order for a Party to
completely fulfill its obligations under the Transaction Documents, such
Party will use all commercially reasonable efforts to cause such third
Persons to provide such cooperation.
6.09 COVENANT NOT TO COMPETE. From the Closing Date until the later of (a)
October 31, 2002 or (b) the termination of the Manufacturing Agreement,
Seller will not for itself or for any of its Affiliates engage in any
enterprise engaged in the business of manufacturing, marketing or selling
meatless products that are the same or similar to the Products (in taste,
texture, appearance or otherwise) anywhere in the United States or Canada.
Notwithstanding the foregoing restriction, Seller may continue to
manufacture and sell existing meatless products that are similar to the
Products on a private label basis to the extent it sells such products to
its existing customers identified on SCHEDULE 6.09. In addition,
notwithstanding the foregoing restriction, Seller may negotiate and enter
into agreement to manufacture meatless products that are similar to the
Products pursuant to agreements with McDonalds, Burger King, Taco ▇▇▇▇,
Wendy's and other similar national fast food restaurants.
6.10 EFFORTS TO CLOSE.
(a) Seller and Buyer will use all commercially reasonable efforts to cause
all of the conditions, as specified in Articles VII and VIII of this
Agreement, to the obligations of the other to consummate the
transactions contemplated hereby to be met as soon as practicable
after the date of this Agreement.
(b) Seller and Buyer will each use commercially reasonable efforts to
obtain, as soon as practicable, the Authorizations that may be or
become necessary for the performance of its obligations under this
Agreement and the consummation of the transactions contemplated hereby
and will cooperate fully with each other in promptly seeking to obtain
such Authorizations.
(c) Seller and Buyer will promptly take any and all of the following
actions to the extent required to eliminate any concerns on the part
of any Governmental Entity regarding the legality under any Antitrust
Law of Buyer's purchase of the Business: (i) use commercially
reasonable efforts to prevent the entry in an Action brought under any
Antitrust Law of any preliminary or permanent injunction or other
order that would prevent, delay or make unlawful the consummation of
the transactions contemplated by this Agreement; (ii) in the event
that such an injunction or order has been issued, promptly take any
and all commercially
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reasonable actions necessary to vacate, modify or suspend such
injunction or order so as to permit the consummation of the
transactions contemplated by this Agreement as nearly as possible on
the schedule contemplated by this Agreement, including, without
limitation, appeal and the posting of a bond; and (iii) promptly take
all other commercially reasonable actions necessary to avoid or
eliminate each and every impediment under any Antitrust Law to the
consummation of the transactions contemplated by this Agreement. The
obligations contained in this Section 6.10 are in addition to and not
in limitation of any other obligations of Seller and Buyer under this
Agreement.
6.11 EMPLOYEES. No employees of Seller will be transferred to Buyer pursuant to
the transactions contemplated by this Agreement.
6.12 EXPENSES. Except as otherwise expressly provided in this Agreement, whether
or not the transactions contemplated by this Agreement are consummated,
Seller and Buyer will each bear its own costs and expenses.
6.13 INTELLECTUAL PROPERTY ASSIGNMENT/RECORDATION/MAINTENANCE. For purposes of
this Section 6.13, the term "expenses" will include, without limitation,
expenses of drafting, notarization, authentication, legalization and/or
consularization.
(a) Seller will prepare and will pay all expenses (whether incurred before
or after the Effective Time) involved in preparing the Trademark
assignment documents, by country, and obtaining appropriate signatures
from Seller's representatives. Buyer will be responsible, and will pay
all expenses (whether incurred before or after the Effective Time)
involved in, obtaining appropriate signatures from Buyer's
representatives on such Trademark assignment documents. Buyer shall
pay all expenses in connection with recording such Trademark
assignment documents with the appropriate Governmental Entities.
(b) Seller will pay all bills for Trademark expenses which are received
after the Effective Time but which relate to work performed for the
benefit of Seller before the Effective Time or to costs to maintain
the Trademarks up to the Effective Time. The phrase "work performed
for the benefit of Seller" will not include any work, whether
performed before or after the Effective Time, related to the transfer
of the Trademarks to Buyer, other than that specifically assumed by
Seller pursuant to Section 6.13(a) above.
6.14 NO SHOP. From the date of this Agreement until the earlier of (a) the
termination of this Agreement pursuant to Section 11.01 and (b) December
31, 1998, Seller will not, and will cause its subsidiaries, Affiliates,
agents, representatives, and any other person acting on behalf of Seller
not to, directly or indirectly solicit, negotiate with respect to, actively
facilitate or accept any offers for the purchase
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or sale of or otherwise transfer the Business, the Acquired Assets or the
Products (other than in the ordinary course of business), or otherwise
effect any transaction inconsistent with the transactions contemplated by
this Agreement.
6.15 OPERATION OF THE BUSINESS PRIOR TO CLOSING. Except for actions taken
pursuant to the prior written consent of Buyer, Seller from the date of
this Agreement until the Closing will:
(a) conduct the Business in the ordinary course;
(b) not transfer any of the Acquired Assets, other than in the ordinary
course of business;
(c) continue to meet the contractual obligations of, and pay obligations
relating to, the Business as they mature in the ordinary course; and
(d) maintain in the ordinary course the business relations of Seller with
its suppliers, business customers and others with whom it has business
relations in connection with the Business.
6.16 SUPPLEMENTS TO SCHEDULES. From time to time prior to the Closing, Seller
may deliver to the Buyer information supplementing or amending the
representations and warranties, and the disclosures made in connection
therewith in the Schedules. Such supplemental information will identify the
specific item or event to be disclosed, and set forth Seller's good faith
estimate of the adverse effect, if any, that such item or event will have
on the Business. Any representation or warranty of Seller will be deemed to
have been amended accordingly; provided, however, that no representation or
warranty will be deemed to have been amended with respect to any Material
supplement or amendment with respect to which Buyer has, within 5 Business
Days of receipt of such supplement or amendment notified Seller of its
desire to modify the terms of this Agreement as a result of such supplement
or amendment, unless and until the parties have negotiated in good faith an
appropriate modification to the terms of this Agreement to reflect such
supplement or amendment.
6.17 USE OF TECHNOLOGY. To the extent that Buyer is operating the Business
subsequent to the Closing Date using the same know-how, formulas
(including, without limitation, current and discontinued flavors and
products, recipes and mixing instructions), improvements, trade secrets,
research and results thereof, inventions, data, methods, processes,
instructions, drawings, and specifications that Seller and its Affiliates
used in operating the Business prior to the Closing Date, or to the extent
Seller makes such use in connection with the permitted competitive
activities described in Section 6.09, Seller hereby waives any right,
remedy or cause of action it might have against Buyer or any Affiliate of
Buyer arising out of or related to such use, regardless of whether such
know-how, patented and unpatented formulas (including, without limitation,
current and
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discontinued flavors and products, recipes and mixing instructions),
improvements, trade secrets, research and results thereof, inventions,
data, methods, processes, instructions, drawings, and specifications
constitute Technology transferred to Buyer under this Agreement. Further,
Buyer grants to Seller a perpetual, nonexclusive, royalty free license to
utilize the Technology in connection with the permitted competitive
activities described in Section 6.09.
6.18 USE OF SELLER'S NAME OR REPUTATION/PACKAGING MATERIALS. Buyer will not
operate the Business utilizing, based on or taking advantage of the name,
reputation or corporate goodwill of Seller without the prior consent of
Seller. Buyer will not utilize packaging, advertising, sales and
promotional materials bearing any of Seller's corporate names, product
identification numbers or consumer information telephone numbers after the
Closing.
ARTICLE VII
ADDITIONAL POST-CLOSING AGREEMENTS
7.01 POST-CLOSING TRANSITION OF BUSINESS. Subject to the terms of conditions of
the agreement between Seller and Pillsbury referenced in Section 3.01(a)(x)
of this Agreement, following the Closing, Buyer will commence as soon as is
reasonably practicable the marketing, sales and distribution of the
Products. Seller agrees to use its best efforts to assist Buyer in promptly
transitioning the Business to Buyer, including, without limitation,
providing assistance in implementing packaging changes and making changes
in brokers and distribution network.
7.02 TELEVISION ADVERTISING. During each of the first three years following the
Closing, Seller will provide, at its expense and at its advertising rates,
for use by Buyer television advertising time having a market value of not
less than $2.3 million during each of such three years, which time shall be
used by Buyer to promote jointly the Products and/or Morningstar Farms
Products owned by Buyer. Buyer shall be responsible for preparing, and the
cost of preparing, each such television advertisement. Buyer agrees to
provide copies of the advertisements to Seller prior to airing such
commercials for Seller's review and approval, which approval shall not be
unreasonably withheld or delayed.
7.03 PRODUCT DEVELOPMENT. Following the Closing and for the term of the
Manufacturing Agreement, Seller will assist Buyer in developing new
products to be marketed and sold by Buyer under the Harvest Burgers brand
name. In addition, during such period, Seller will assist Buyer in
developing enhancements to the existing Products. Any new formulas, recipes
or manufacturing technology developed by Buyer with the assistance of
Seller shall belong to Buyer. Seller shall provide such assistance to Buyer
only upon request of Buyer. If Seller
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provides such assistance at the request of Buyer, Buyer shall reimburse
Seller for its direct cost, including internal costs, incurred in providing
such assistance.
7.04 SALES AND MARKETING ASSISTANCE TO BUYER. During the term of the
Manufacturing Agreement, Seller, at the request of Buyer, will provide
assistance to Buyer in developing new business relationships to sell
Products under the Harvest Burgers and Morningstar Farms brand names to
food service businesses such as major restaurant chains. If Buyer requests
such assistance from Seller, Seller shall be entitled to reimbursement from
Buyer for its direct costs, including internal costs, incurred in providing
such assistance. During the term of the Manufacturing Agreement, Seller and
Buyer will endeavor to identify mutually beneficial opportunities for the
production, marketing and sales of Harvest Burgers and Morningstar Farms
Products in international markets. Seller agrees to discuss with Buyer a
possible business relationship between Buyer and Haldane in the United
Kingdom. During the term of the Manufacturing Agreement, Buyer shall
generally discuss with Seller, at least quarterly, its current sales and
marketing reports and plans relating to the Harvest Burger Products.
(provided, however, that Buyer shall under no circumstance be required to
discuss in any respect its sales and marketing reports or plans relating to
the food service industry).
7.05 TRADE SUPPORT BY SELLER. Seller will provide $300,000 to provide trade
support of the Harvest Burger Products and to otherwise assist Buyer in
communicating with the trade and customers concerning packaging changes
involving the Harvest Burger Products during the fourth quarter of 1998.
Seller and Buyer shall discuss and mutually agree on the expenditure of
such funds. Up to $100,000 of such funds shall be used to reimburse Buyer
in connection with the production of one or more television commercials
focusing on the transition of the Products from Pillsbury to Buyer, which
commercials the parties agree shall air during the fourth quarter of 1998
as soon as is reasonably practicable following the completion of such
commercials.
7.06 MANUFACTURING TRANSITION. Consistent with the agreement referenced in
Section 3.01(a)(ix) to be entered into between Pillsbury and Seller, Seller
agrees that it will cease manufacturing any of the Harvest Burger Products
under the Green Giant label as soon as Buyer provides to Seller the new
packaging materials for the Harvest Burger Products. Seller agrees to use
its best efforts to ensure an orderly transition of the manufacture of the
Harvest Burger Products for Pillsbury to Buyer as soon as is reasonably
practicable. Seller acknowledges and agrees that Buyer shall have no
obligations relating to any of the Inventory or any Harvest Burger Products
that were manufactured by Seller for Pillsbury. Seller agrees to promptly
notify Pillsbury at such time as Buyer delivers new packaging materials for
the Harvest Burger Products and advise Pillsbury that, following such date,
Seller shall no longer supply Products to Pillsbury.
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7.07 REGISTRATION RIGHTS. Seller shall have registration rights with respect to
the Worthington Shares as are set forth on SCHEDULE 7.07.
7.08 PURCHASE OF INGREDIENTS FROM SELLER. With respect to the ingredients that
are produced by Seller that are used in Buyer's products, it is the current
intention, but not the legal obligation, of Buyer to purchase from Seller a
majority of such ingredients used in Buyer's products so long as such
ingredients are functionally equivalent to the ingredients specified or
otherwise sourced by Buyer for such products (with such functional
equivalence being determined in the sole discretion of Buyer) and the terms
and conditions of such purchase are not less favorable to Buyer than those
offered to Buyer by competitors of Seller.
ARTICLE VIII
CONDITIONS TO SELLER'S OBLIGATION TO CLOSE
All obligations of Seller to sell the Acquired Assets, to transfer the Business,
and to perform any other action at the Closing are subject to the fulfillment,
prior to or at the Closing, of each of the following conditions, any of which
may be waived by Seller in whole or in part without written or oral notice of
such waiver to Buyer.
8.01 AUTHORIZATIONS/WAITING PERIODS. All Authorizations necessary for the
Closing will have been obtained, except where failure to obtain such
Authorizations will not have a material adverse effect on Seller, the
Business, this Agreement or the consummation of the transactions
contemplated hereby.
8.02 NO INJUNCTION/ORDER. No preliminary or permanent injunction or other order
will have been issued that would make unlawful the consummation of the
transactions contemplated by this Agreement.
8.03 PERFORMANCE OF BUYER'S OBLIGATIONS. Buyer will have fully performed all
commitments required by this Agreement to be performed prior to Closing
(except for those which, in the aggregate, will not have a material adverse
effect on this Agreement or the consummation of the transactions
contemplated hereby) and will have delivered at the Closing the Worthington
Shares and the documents required in Section 3.01(b) and (c).
8.04 BUYER'S REPRESENTATIONS AND WARRANTIES TRUE. All representations and
warranties of Buyer contained in this Agreement will be true and correct in
all material respects (except that all representations and warranties
qualified as to materiality will be true in all respects) as of the
Closing, except for those which, in the aggregate, will not have a material
adverse effect on this Agreement or the consummation of the transactions
contemplated hereby.
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ARTICLE IX
CONDITIONS TO BUYER'S OBLIGATION TO CLOSE
All obligations of Buyer to purchase the Acquired Assets, to issue the
Worthington Shares and to perform any other action at the Closing are subject to
the fulfillment, prior to or at the Closing, of each of the following
conditions, any of which may be waived by Buyer in whole or in part without
written or oral notice of such waiver to Seller.
9.01 AUTHORIZATIONS/WAITING PERIODS. All Authorizations necessary for the
Closing will have been obtained, except where failure to obtain such
Authorizations will not have a material adverse effect on this Agreement or
the consummation of the transactions contemplated hereby. In addition, the
Worthington Shares will have been approved for issuance by the NASDAQ
National Market System.
9.02 NO INJUNCTION/ORDER. No preliminary or permanent injunction or other order
will have been issued that would make unlawful the consummation of the
transactions contemplated by this Agreement.
9.03 PERFORMANCE OF SELLER'S OBLIGATIONS. Seller will have fully performed all
commitments required by this Agreement to be performed prior to Closing,
except for those which, in the aggregate are not Material, and will have
tendered at the Closing the documents required in Section 3.01(a) and (c).
9.04 SELLER'S REPRESENTATIONS AND WARRANTIES TRUE. All representations and
warranties of Seller contained in this Agreement will be true and correct
in all material respects (except that all representations and warranties
qualified as to materiality will be true in all respects) as of the
Closing, except for those which, in the aggregate, are not Material.
ARTICLE X
INDEMNIFICATION AND ARBITRATION
10.01 INDEMNIFICATION BY SELLER.
(a) Subject to the terms and conditions of this Agreement, Seller will
defend, indemnify and hold Buyer and its Affiliates harmless from and
against: (i) all claims, losses, liabilities, damages, costs and
expenses (including, without limitation, reasonable fees and expenses
of attorneys incurred in investigation or defense of any third-party
Action, but excluding fees, costs and expenses of attorneys,
accountants, consultants or other experts or witnesses incurred in the
investigation or prosecution of any non third-party Action) related to
(A) any liability or obligation of Seller of
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any nature whatsoever which has not been expressly (and in writing)
assumed by Buyer, including without limitation, any obligation or
liability incurred in connection with the operation of the Business
prior to the Closing or (B) any breach of a representation and
warranty or covenant of Seller in this Agreement and (ii) all costs
and expenses of Buyer (including, without limitation, reasonable fees
and expenses of attorneys) incurred in connection with the successful
enforcement of any rights of Buyer under the indemnity provided in
this Section 10.01.
(b) Promptly after receipt by Buyer of notice of any third-party Action in
respect of which indemnity may be sought against Seller hereunder (for
purposes of this Section 10.01, a "Buyer's Assertion"), Buyer will
notify Seller in writing of the Buyer's Assertion, but the failure to
so notify Seller will not relieve Seller of any liability it may have
to Buyer, except to the extent Seller has suffered actual prejudice
thereby. Seller will be entitled to participate in the defense of such
Buyer's Assertion. If Seller, by written notice to Buyer within 30
days after receipt by Seller of notice of such Buyer's Assertion,
acknowledges its responsibility to indemnify Buyer based on the facts
alleged in the third-party Action and the Buyer's Assertion and if
Seller elects to do so, Seller will also be entitled to assume the
defense of such Buyer's Assertion, at its own expense, with counsel
chosen by it which will be reasonably satisfactory to Buyer. With
respect to any such Buyer's Assertion, Buyer will promptly provide
Seller with: (i) notice and copies of any documents served upon Buyer;
and (ii) all reasonable cooperation which Seller deems necessary to
defend such Buyer's Assertion, including, without limitation,
providing Seller and its attorneys access to any potentially-relevant
documents, information, or individuals within the control of Buyer. If
business information of Buyer other than that pertaining to the
Business is contained in such documents or information, Seller and
Buyer will enter into appropriate secrecy commitments to protect such
documents or information. Notwithstanding that Seller may have elected
as provided above to assume the defense of any Buyer's Assertion,
Buyer will have the right to participate in the investigation and
defense thereof, with separate counsel chosen by Buyer, but in such
event the fees and expenses of Buyer (above those which would
otherwise have been incurred) and such separate counsel will be paid
by Buyer.
(c) Notwithstanding anything in this Section 10.01 to the contrary: (i)
Seller will have no obligation with respect to any Buyer's Assertion
if, in connection therewith, Buyer, without the written consent of
Seller, settles or compromises any Action or consents to the entry of
any judgment (provided Seller has not rejected the Buyer's Assertion
or failed to respond within the time allotted under Section 10.01(b)
above to proper notice of the Buyer's Assertion, in which case Sellers
obligation will be determined by mutual agreement between the Parties
or under the
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procedures described in Section 10.03 below); and (ii) Seller will
not, without the written consent of Buyer with respect to any Buyer's
Assertion: (A) settle or compromise any Action or consent to the entry
of any judgment which does not include as an unconditional term
thereof the delivery by the claimant or plaintiff to Buyer of a duly
executed written release of Buyer from all liability in respect of
such Action, which release will be reasonably satisfactory in form and
substance to counsel for Buyer; or (B) settle or compromise any Action
in any manner that, in the reasonable judgment of Buyer or its
counsel, may materially adversely affect Buyer or its Affiliates, it
being acknowledged and agreed that any settlement or compromise
pursuant to which the sole relief is monetary damages that are paid in
full by Seller will not be deemed to materially adversely affect Buyer
or its Affiliates.
(d) Upon the payment of any settlement or judgment pursuant to this
Section 10.01 with respect to any Buyer's Assertion, Seller will be
subrogated to all rights and remedies of Buyer and its Affiliates
against any third party in respect of such Buyer's Assertion to the
extent of the amount so paid by Seller.
(e) The indemnity provided for by this Section 10.01 will be Buyer's and
its Affiliates' exclusive source of recovery against Seller with
respect to matters covered hereby.
10.02 INDEMNIFICATION BY BUYER.
(a) Subject to the terms and conditions of this Agreement, Buyer will
defend, indemnify and hold Seller and its Affiliates harmless from and
against: (i) all claims, losses, liabilities, damages, costs and
expenses (including, without limitation, reasonable fees and expenses
of attorneys incurred in investigation or defense of any third-party
Action, but excluding fees, costs and expenses of attorneys,
accountants, consultants or other experts or witnesses incurred in the
investigation or prosecution of any non third-party Action) related to
(A) any liability or obligation of Buyer of any nature whatsoever
including, without limitation, any liability or obligation of Buyer
incurred in connection with Buyer's operation of the Business after
the Closing; or (B) any breach of a representation and warranty or
covenant of Buyer in this Agreement and (ii) all costs and expenses of
Seller and its Affiliates (including, without limitation, reasonable
fees and expenses of attorneys) incurred in connection with the
successful enforcement of any rights of Seller under the indemnity
provided in this Section 10.02.
(b) Promptly after receipt by Seller of notice of any third-party Action
in respect of which indemnity may be sought against Buyer hereunder
(for purposes of this Section 10.02, a "Seller's Assertion"), Seller
will notify
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Buyer in writing of the Seller's Assertion, but the failure to so
notify Buyer will not relieve Buyer of any liability it may have to
Seller or its Affiliates, except to the extent Buyer has suffered
actual prejudice thereby. Buyer will be entitled to participate in the
defense of such Seller's Assertion. If Buyer, by written notice to
Seller within 30 days after receipt by Buyer of notice of such
Seller's Assertion, acknowledges its responsibility to indemnify
Seller based on the facts alleged in the third-party Action and the
Seller's Assertion and if Buyer elects to do so, Buyer will also be
entitled to assume the defense of such Seller's Assertion, at its own
expense, with counsel chosen by it which will be reasonably
satisfactory to Seller. With respect to any such Seller's Assertion,
Seller will promptly provide Buyer with: (i) notice and copies of any
documents served upon Seller or its Affiliates; and (ii) all
reasonable cooperation which Buyer deems necessary to defend such
Seller's Assertion, including, without limitation, providing Buyer and
its attorneys access to any potentially- relevant documents,
information, or individuals within the control of Seller or Seller's
Affiliates. If business information of Seller or its Affiliates other
than that pertaining to the Business is contained in such documents or
information, Seller and Buyer will enter into appropriate secrecy
commitments to protect such documents or information. Notwithstanding
that Buyer may have elected as provided above to assume the defense of
any Seller's Assertion, Seller will have the right to participate in
the investigation and defense thereof, with separate counsel chosen by
Seller, but in such event the fees and expenses of Seller (above those
which would otherwise have been incurred) and such separate counsel
will be paid by Seller.
(c) Notwithstanding anything in this Section 10.02 to the contrary: (i)
Buyer will have no obligation with respect to any Seller's Assertion
if, in connection therewith, Seller or its Affiliates, without the
written consent of Buyer, settle or compromise any Action or consent
to the entry of any judgment (provided Buyer has not rejected the
Seller's Assertion or failed to respond within the time allotted under
Section 10.02(b) above to proper notice of the Seller's Assertion, in
which case Buyer's obligation will be determined by mutual agreement
between the Parties or under the procedures described in Section 10.03
below); and (ii) Buyer will not, without the written consent of Seller
with respect to any Seller's Assertion: (A) settle or compromise any
Action or consent to the entry of any judgment which does not include
as an unconditional term thereof the delivery by the claimant or
plaintiff to Seller of a duly executed written release of Seller and
its Affiliates from all liability in respect of such Action, which
release will be reasonably satisfactory in form and substance to
counsel for Seller; or (B) settle or compromise any Action in any
manner that, in the reasonable judgment of Seller or its Affiliates or
their counsel, may materially adversely affect Seller or its
Affiliates, it being acknowledged and agreed that any settlement or
compromise pursuant to
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which the sole relief is monetary damages that are paid in full by
Buyer will not be deemed to materially adversely affect Seller or its
Affiliates.
(d) Upon the payment of any settlement or judgment pursuant to this
Section 10.02 with respect to any Seller's Assertion, Buyer will be
subrogated to all rights and remedies of Seller and its Affiliates
against any third party in respect of such Seller's Assertion to the
extent of the amount so paid by Buyer.
(e) The indemnity provided for by this Section 10.02 will be Seller's and
its Affiliates' exclusive source of recovery against Buyer with
respect to matters covered hereby.
10.03 DISPUTE RESOLUTION.
(a) Any Action asserted by Seller against Buyer or by Buyer against Seller
(a "Claim") arising out of or related to the Transaction Documents,
including, without limitation, any Claim for indemnification pursuant
to Article X hereof or any issue as to whether or not a Claim is
arbitrable, will be resolved pursuant to the procedures described in
this Section 10.03.
(b) Should any Claim arise, Seller and Buyer will first attempt to resolve
such Claim by entering into good faith negotiations by or among their
appropriate employees or officers. Such negotiations will commence as
soon as practicable after Seller and Buyer have both received notice
of such Claim, but no later than 10 days after such receipt, and will
terminate 30 calendar days after such commencement. During
negotiations, Seller and Buyer will not have the right to any
discovery unless agreed to by both Seller and Buyer.
(c) Any Claim which has not been resolved pursuant to Section 10.03(b) of
this Agreement will be determined by arbitration. The arbitration will
be conducted by three arbitrators, one of whom will be appointed by
Seller, one of whom will be appointed by Buyer, and the third who will
be chosen by the first two arbitrators. The arbitration will be held
in a mutually agreed to location in Ohio and will be conducted in
accordance with the Commercial Arbitration Rules of the American
Arbitration Association ("AAA"), except that the rules set forth in
this Section 10.03(c) will govern such arbitration to the extent they
conflict with the rules of the AAA. Costs of the arbitration will be
shared equally by Seller and Buyer, except Seller and Buyer will each
pay its own arbitrator, attorneys, accountants, consultants and other
experts and witnesses. Seller and Buyer will use commercially
reasonable efforts to cause the arbitration to be conducted in an
expeditious manner. Seller and Buyer will use their commercially
reasonable efforts to cause the arbitration to be completed within 60
days after final selection of the arbitrators. In the arbitration,
Ohio law will
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govern, except to the extent that those laws conflict with the
Commercial Arbitration Rules of the AAA and the provisions of this
Section 10.03(c). There will be no discovery except as the arbitrators
will permit following a determination by the arbitrators that the
Person seeking such discovery has a substantial demonstrable need. All
other procedural matters will be within the discretion of the
arbitrators. In the event a Person fails to comply with the procedures
in any arbitration in a manner deemed material by the arbitrators, the
arbitrators will fix a reasonable period of time for compliance and,
if the Person does not comply within said period, a remedy deemed just
by the arbitrators, including an award of default, may be imposed. The
determination of the arbitrators will be final and binding on the
Seller and Buyer. Judgment upon the award rendered by the arbitrators
may be entered in any court having jurisdiction thereof.
10.04 DAMAGE LIMITATIONS.
(a) Notwithstanding anything to the contrary in the Transaction Documents,
neither Seller nor Buyer will be permitted to recover from the other
any consequential, indirect, or punitive damages arising out of or
related to the Transaction Documents, regardless of the form of the
Claim or Action, including, without limitation, Claims or Actions for
indemnification, tort, breach of contract, warranty, representation or
covenant.
(b) Seller's aggregate liability arising out of or related to breaches of
representations or warranties contained in this Agreement, regardless
of the form of the Claim or Action, including, without limitation,
Claims or Actions for indemnification, tort, breach of contract,
warranty or representation, is limited to the amount by which all such
liabilities exceed twenty-five thousand United States dollars
(US $25,000).
(c) Buyer's aggregate liability arising out of or related to breaches of
representations or warranties contained in this Agreement regardless
of the form of the Claim or Action, including, without limitation,
Claims or Actions for indemnification, tort, breach of contract,
warranty or representation, is limited to the amount by which all such
liabilities exceed twenty-five thousand United States dollars (US
$25,000).
10.05 TERMINATION OF INDEMNIFICATION. The obligation to indemnify a Person
pursuant to Sections 10.01(a)(i)(B) and 10.02(a)(i)(B) will terminate when
the applicable representation or warranty terminates pursuant to Section
12.03; provided, however, that such indemnification obligation will not
terminate with respect to any item as to which the Person to be
indemnified will have, prior to the expiration of the applicable period,
previously delivered written notice (stating in reasonable detail the
nature of, and factual and legal basis for, any Claim, and the provisions
of this Agreement on which such Claim is made) to the other Party.
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10.06 CLAIMS UNDER MANUFACTURING AGREEMENT. Anything contained in this Agreement
to the contrary notwithstanding, a claim by Buyer or Seller for breach of
the Manufacturing Agreement shall be asserted pursuant to the terms and
conditions of the Manufacturing Agreement and, except as otherwise set
forth in the Manufacturing Agreement, shall not be subject to the
provisions of this Article X.
ARTICLE XI
TERMINATION AND ABANDONMENT
11.01 TERMINATION. This Agreement may be terminated at any time prior to the
Closing:
(a) by mutual written consent of Seller and Buyer;
(b) by either of Seller or Buyer if the Closing has not occurred before
December 31, 1998, provided that the terminating Person is not then
in default hereunder; and
(c) by either of Seller or Buyer if any Governmental Entity has issued a
final, non-appealable order, decree or ruling permanently enjoining
or prohibiting the consummation of the transactions contemplated by
this Agreement.
11.02 PROCEDURE AND EFFECT OF TERMINATION. In the event of termination of this
Agreement and abandonment of the transactions contemplated hereby pursuant
to Section 11.01 hereof, written notice thereof will promptly be given to
all appropriate entities and this Agreement will terminate and the
transactions contemplated hereby will be abandoned, without further action
by either of Seller or Buyer, and without additional liability on the part
of either of them or their Affiliates, directors, officers, shareholders,
employees, contractors or agents, except for Sections 6.05, 6.12, 10.03
and 11.02 and any definitions pertaining thereto, which sections and
definitions will continue to bind the Parties as necessary to effectuate
their purpose. Nothing contained in this Section 11.02 will release either
of Seller or Buyer from liability for any breach of this Agreement prior
to its termination.
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ARTICLE XII
MISCELLANEOUS
12.01 AMENDMENT AND MODIFICATION. The Transaction Documents may be amended,
modified or supplemented only by the written agreement of Seller and
Buyer.
12.02 WAIVER OF COMPLIANCE. Except as otherwise provided in the Transaction
Documents, the failure by any Person to comply with any obligation,
covenant, agreement or condition under such agreements may be waived by
the Person entitled to the benefit thereof only by a written instrument
signed by the Person granting such waiver, but such waiver or failure to
insist upon strict compliance with such obligation, covenant, agreement or
condition will not operate as a waiver of, or estoppel with respect to,
any subsequent or other failure. The failure of any Person to enforce at
any time any of the provisions of such agreements will in no way be
construed to be a waiver of any such provision, nor in any way to affect
the validity of such agreements or any part thereof or the right of any
Person thereafter to enforce each and every such provision. No waiver of
any breach of such provisions will be held to be a waiver of any other or
subsequent breach.
12.03 SURVIVAL OF REPRESENTATIONS AND WARRANTIES; OTHER MATTERS. Each and every
representation and warranty of Seller or Buyer contained in this Agreement
will survive any investigation and will not be extinguished by the
Closing, but will survive for a period of 24 months from the Closing Date.
No Party may initiate any Claim nor will any Party be responsible for any
Action arising out of or related to a breach of a representation or
warranty under this Agreement, regardless of the form of the Claim or
Action, including, without limitation, indemnification, tort, breach of
contract, warranty or representation, unless such Claim or Action is
initiated prior to the expiration of the relevant representation or
warranty. All other covenants and agreements of the Parties hereto are
subject to all applicable statutes of limitation, statutes of repose and
other similar defenses provided by law or equity.
12.04 NOTICES. All notices required or permitted pursuant to this Agreement will
be in writing and will be deemed to be properly given when actually
received by the Person entitled to receive the notice at the address
stated below, or at such other address as a Party may provide by notice to
the other:
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Seller: Mailing Delivery
------- --------
Worthington Foods, Inc. Worthington Foods, Inc.
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
ATTENTION: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇ ATTENTION: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Buyer: Mailing Delivery
------- --------
▇▇▇▇▇▇-▇▇▇▇▇▇▇-Midland Company ▇▇▇▇▇▇-▇▇▇▇▇▇▇-Midland Company
▇.▇. ▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
ATTENTION: General Counsel
12.05 EXHIBITS AND SCHEDULES; INCORPORATION BY REFERENCE. The exhibits and
schedules attached to this Agreement, each when executed and delivered,
are incorporated by reference into and made a part of this Agreement. The
fact that any document, asset, item, action, entity, event, condition,
claim, agreement, or other matter (hereinafter collectively referred to as
"Matter') is set forth or described or referred to in any one or more
exhibits or schedules will not be construed as a representation, warranty,
acknowledgment or admission by any Person or as evidence that such Matter
is, or may at any time be or have been, Material or in any way significant
to the transactions contemplated by this Agreement. Disclosure in any
exhibit or schedule to this Agreement will be deemed to be disclosure in
any exhibit(s) or schedule(s) where such disclosure would be appropriate
or required.
12.06 SUCCESSORS AND ASSIGNS. The Transaction Documents will be binding upon and
will inure to the benefit of the signatories thereto and their respective
successors and permitted assigns. Except as otherwise set forth in the
applicable Transaction Document, neither Seller nor Buyer may assign any
of the Transaction Documents, or any of their rights or liabilities
thereunder, without the prior written consent of the other Party, provided
that: (a) Seller and Buyer may so assign in whole or in part, to one or
more of their Affiliates; and (b) Buyer may so assign in whole or in part
in connection with the sale of all or substantially all of the assets of
the Business to any unaffiliated third party (regardless of the form of
the transaction); provided however, that Seller will have no obligations
whatsoever, including, without limitation, obligations to provide
information or assistance in connection with such sale or the third
party's financing thereof, and provided further that no such assignment
will limit or otherwise affect Buyer's obligations hereunder.
-35-
41
12.07 ENTIRE AGREEMENT. The Transaction Documents constitute the entire
agreement between the signatories hereto with respect to the subject
matter thereof and will supersede all previous negotiations, commitments,
and writings with respect to such subject matter. SELLER AND BUYER MAKE NO
REPRESENTATIONS OR WARRANTIES, WHETHER EXPRESS OR IMPLIED, OTHER THAN
THOSE SPECIFICALLY SET FORTH IN THE TRANSACTION DOCUMENTS.
12.08 SEVERABILITY. The illegality or partial illegality of any or all of the
Transaction Documents, or any provision thereof, will not affect the
validity of the remainder of such agreements, or any provision thereof,
and the illegality or partial illegality of any such agreements will not
affect the validity of any such agreement in any jurisdiction in which
such determination of illegality or partial illegality has not been made,
except in either case to the extent such illegality or partial illegality
causes such agreements to no longer contain all of the material provisions
reasonably expected by the signatories to be contained therein.
12.09 CAPTIONS. The captions appearing in the Transaction Documents are inserted
only as a matter of convenience and as a reference and in no way define,
limit or describe the scope or intent of such agreements or any of the
provisions thereof.
12.10 COUNTERPARTS. The Transaction Documents may be executed in one or more
counterparts, each of which will be deemed to be an original, but all of
which will constitute one agreement.
12.11 GOVERNING LAW. The Transaction Documents will be governed by and construed
in accordance with the laws of Ohio, whether common law or statutory,
without reference to the choice of law provisions thereof.
IN WITNESS WHEREOF, each of the signatories hereto has caused this Agreement to
be signed by their respective duly authorized officers as of the date first
above written.
▇▇▇▇▇▇-▇▇▇▇▇▇▇-MIDLAND COMPANY WORTHINGTON FOODS, INC.
By: /s/ By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇
---------------------------- ------------------------------
▇▇▇▇ ▇. ▇▇▇▇▇▇▇, President
Its: GROUP VICE PRESIDENT
----------------------------
42
SCHEDULE 1.14
TO ASSET SALE AND
PURCHASE AGREEMENT
DATED SEPTEMBER 28, 1998
GREEN GIANT HARVEST BURGERS CASE VOLUME:
(NUMBERS REPRESENT THOUSANDS OF 12 PACKS)
HB
Month & Year Burgers For Recipe Total
----------- ------- ---------- -----
August 1998 40.9 12.8 53.7
July 1998 61.9 14.3 76.2
June 1998 59.2 13.0 72.2
May 1998 43.6 12.0 55.6
April 1998 43.6 13.0 56.6
March 1998 47.3 16.9 64.2
February 1998 35.7 19.0 54.7
January 1998 34.8 16.4 51.2
HB
Month & Year Burgers For Recipe Total
----------- ------- ---------- -----
December 1997 38.3 16.1 54.4
November 1997 36.6 16.1 52.7
October 1997 39.8 21.2 61.0
September 1997 54.5 16.6 71.1
August 1997 42.0 8.1 50.7
July 1997 39.2 15.2 54.4
June 1997 62.2 16.6 78.8
May 1997 80.6 14.9 95.5
April 1997 47.5 13.3 60.8
March 1997 50.1 14.7 64.8
February 1997 50.2 14.6 64.8
January 1997 59.6 14.6 74.2
43
HB
Month & Year Burgers For Recipe Total
----------- ------- ---------- -----
December 1996 29.9 9.1 39.0
November 1996 44.4 15.1 59.5
October 1996 64.3 19.4 83.7
September 1996 65.5
August 1996 49.7
July 1996 72.8 4.8 77.6
June 1996 73.5 8.6 82.1
May 1996 86.0 2.9 88.9
April 1996 48.1 20.9 69.0
March 1996 38.8 3.5 42.3
February 1996 65.3 15.0 80.3
January 1996 43.9 16.7 60.6
HB
Month & Year Burgers For Recipe Total
----------- ------- ---------- -----
December 1995 29.2 -- 29.2
November 1995 52.1 -- 52.1
October 1995 54.0 .3 54.3
September 1995 -- 58.8
August 1995 -- 81.5
July 1995 -- 42.2
June 1995 -- 87.0
May 1995 -- 40.6
April 1995 -- 54.0
March 1995 -- 70.5
February 1995 -- 65.5
January 1995 -- 76.9
44
ESTIMATED FOOD SERVICE & DRY RETAIL SALES NUMBERS
-------------------------------------------------
1995 Number of Cases
---- ---------------
Frozen (48 - 3.2 oz. Burgers/Case) 4,780
Dry Mix (45 - 4 oz. Pouch & 30 - 6 oz. Pouch) 759
Dry Mix (9 - 20 oz. Pouch & 6 - 30 oz. Pouch) 2,326
10 kg. Bag 5,129
1996 Number of Cases
---- ---------------
Frozen (48 - 3.2 oz. Burgers/Case) 7,457
Dry Mix (45 - 4 oz. Pouch & 30 - 6 oz. Pouch) 486
Dry Mix (9 - 20 oz. Pouch & 6 - 30 oz. Pouch) 1,667
10 kg. Bag 3,060
1997 Number of Cases
---- ---------------
Frozen (48 - 3.2 oz. Burgers/Case) 6,863
Dry Mix (45 - 4 oz. Pouch & 30 - 6 oz. Pouch) 418
Dry Mix (9 - 20 oz. Pouch & 6 - 30 oz. Pouch) 1,398
10 kg. Bag 3,256
1998 (January - July 31) Number of Cases
------------------------ ---------------
Frozen (48 - 3.2 oz. Burgers/Case) 7,149
Dry Mix (45 - 4 oz. Pouch & 30 - 6 oz. Pouch) 1,091
Dry Mix (9 - 20 oz. Pouch & 6 - 30 oz. Pouch) 971
10 kg. Bag 1,387
45
SCHEDULE 1.23
TO ASSET SALE AND
PURCHASE AGREEMENT
DATED SEPTEMBER 28, 1998
Harvest Burgers - Original Flavor
Harvest Burgers - Southwestern Style
Harvest Burgers - Italian Style
Harvest Burgers For Recipes
Harvest Burgers - Food Service Products
Harvest Burgers - Retail Dry Mixes
Breakfast Links
Breakfast Patties
46
SCHEDULE 1.26
TO ASSET SALE AND
PURCHASE AGREEMENT
DATED SEPTEMBER 28, 1998
TRADEMARK NAME
--------------
Appln. Number Reg. Number
Country Status Appln. Date Reg. Date Renewal Date
--------------- --------- ------------- ---------- -------------
HARVEST BURGERS
Argentina Pending 2054994
30-Oct-96
Benelux Registered 768095 501664
21-Aug-91 21-Aug-91 21-Aug-01
Canada Registered 688999 426854
30-Aug-91 06-May-94 ▇▇-▇▇▇-▇▇
▇▇▇▇▇ Registered 237272 430086
▇▇-▇▇▇-▇▇ ▇▇-▇▇▇-▇▇ ▇▇-▇▇▇-▇▇
▇▇▇▇▇▇▇ Registered 3955/91 129991
▇▇-▇▇▇-▇▇ ▇▇-▇▇▇-▇▇ ▇▇-▇▇▇-▇▇
▇▇▇▇▇▇▇ Registered A50837/29W 2060404
▇▇-▇▇▇-▇▇ ▇▇-▇▇▇-▇▇ ▇▇-▇▇▇-▇▇
▇▇▇▇▇ Registered M191C006343 00625960
▇▇-▇▇▇-▇▇ ▇▇-▇▇▇-▇▇ ▇▇-▇▇▇-▇▇
▇▇▇▇▇ Abandoned 3-91832
04-Sep-91
New Zealand Pending 288107
▇▇-▇▇▇-▇▇
▇▇▇▇ Pending 031984
11-Feb-97
Singapore Registered S/8041/91 S/8041/91
27-Aug-91 27-Aug-91 27-Aug-01
47
Appln. Number Reg. Number
Country Status Appln. Date Reg. Date Renewal Date
--------------- --------- ------------- ---------- -------------
United Kingdom Registered 2158212 2158212
▇▇-▇▇▇-▇▇ ▇▇-▇▇▇-▇▇ ▇▇-▇▇▇-▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇ Registered 74/128573 1665961
07-Jan-91 ▇▇-▇▇▇-▇▇ ▇▇-▇▇▇-▇▇
▇▇▇▇▇▇▇ Pending 291234
▇▇-▇▇▇-▇▇
▇▇▇▇▇▇▇▇▇ Pending 17.922-91
06-Sep-91
48
SCHEDULE 3.01(a)(iv)
TO ASSET SALE AND
PURCHASE AGREEMENT
DATED SEPTEMBER 28, 1998
None
49
SCHEDULE 4.02
TO ASSET SALE AND
PURCHASE AGREEMENT
DATED SEPTEMBER 28, 1998
None
50
SCHEDULE 4.03
TO ASSET SALE AND
PURCHASE AGREEMENT
DATED SEPTEMBER 28, 1998
None
51
SCHEDULE 4.06(a)(i)
TO ASSET SALE AND
PURCHASE AGREEMENT
DATED SEPTEMBER 28, 1998
None
52
SCHEDULE 4.06(a)(ii)
TO ASSET SALE AND
PURCHASE AGREEMENT
DATED SEPTEMBER 28, 1998
"For Recipe"
53
SCHEDULE 4.06(a)(iii)
TO ASSET SALE AND
PURCHASE AGREEMENT
DATED SEPTEMBER 28, 1998
None
54
SCHEDULE 4.06(a)(vi)
TO ASSET SALE AND
PURCHASE AGREEMENT
DATED SEPTEMBER 28, 1998
None
55
SCHEDULE 4.06(a)(v)
TO ASSET SALE AND
PURCHASE AGREEMENT
DATED SEPTEMBER 28, 1998
None
56
SCHEDULE 4.06(a)(vi)
TO ASSET SALE AND
PURCHASE AGREEMENT
DATED SEPTEMBER 28, 1998
None
57
SCHEDULE 4.06(a)(vii)
TO ASSET SALE AND
PURCHASE AGREEMENT
DATED SEPTEMBER 28, 1998
None
58
SCHEDULE 4.06(a)(viii)
TO ASSET SALE AND
PURCHASE AGREEMENT
DATED SEPTEMBER 28, 1998
None
59
SCHEDULE 4.06(b)(i)
TO ASSET SALE AND
PURCHASE AGREEMENT
DATED SEPTEMBER 28, 1998
None
60
SCHEDULE 4.06(b)(ii)
TO ASSET SALE AND
PURCHASE AGREEMENT
DATED SEPTEMBER 28, 1998
None
61
SCHEDULE 4.06(b)(iii)
TO ASSET SALE AND
PURCHASE AGREEMENT
DATED SEPTEMBER 28, 1998
None
62
SCHEDULE 4.06(b)(iv)
TO ASSET SALE AND
PURCHASE AGREEMENT
DATED SEPTEMBER 28, 1998
None
63
SCHEDULE 4.06(c)(i)
TO ASSET SALE AND
PURCHASE AGREEMENT
DATED SEPTEMBER 28, 1998
None
64
SCHEDULE 4.06(c)(ii)
TO ASSET SALE AND
PURCHASE AGREEMENT
DATED SEPTEMBER 28, 1998
None
65
SCHEDULE 4.06(c)(iii)
TO ASSET SALE AND
PURCHASE AGREEMENT
DATED SEPTEMBER 28, 1998
None
66
SCHEDULE 4.06(c)(iv)
TO ASSET SALE AND
PURCHASE AGREEMENT
DATED SEPTEMBER 28, 1998
None
67
SCHEDULE 4.07
TO ASSET SALE AND
PURCHASE AGREEMENT
DATED SEPTEMBER 28, 1998
None
68
SCHEDULE 4.14
TO ASSET SALE AND
PURCHASE AGREEMENT
DATED SEPTEMBER 28, 1998
None
69
SCHEDULE 4.15
TO ASSET SALE AND
PURCHASE AGREEMENT
DATED SEPTEMBER 28, 1998
None
70
SCHEDULE 5.02
TO ASSET SALE AND
PURCHASE AGREEMENT
DATED SEPTEMBER 28, 1998
None
71
SCHEDULE 5.09
-------------
WORTHINGTON FOODS, INC.
CAPITALIZATION
Authorized Capital Stock: 30,000,000 common shares, without par value,
11,750,859 common shares issued and
outstanding as of July 29, 1998; no material
change since July 29, 1998.
2,000,000 preferred shares, without par value,
none issued or outstanding
72
SCHEDULE 6.09
TO ASSET SALE AND
PURCHASE AGREEMENT
DATED SEPTEMBER 28, 1998
Food Club
Bounty Gourmet
Veggieland
O'Neil Foods
Overhill Farms
▇▇▇▇▇ USA
73
SCHEDULE 7.07
-------------
SELLER'S REGISTRATION RIGHTS
PROVISIONS APPLICABLE TO DEMAND REGISTRATION
1. Seller may at any time after tenth month following the Closing
Date request Buyer, in writing (a "Registration Notice"), to register any or all
of the Worthington Shares then owned by Seller. Buyer shall use its best efforts
to cause the number of Worthington Shares specified in such request to bee
registered with the Securities and Exchange Commission ("SEC") as soon as
reasonably practicable so as to permit the sale thereof, and in connection
therewith prepare and file as promptly as practicable with the SEC a
registration statement under the Securities Act of 1933, as amended (the
"Securities Act") to effect such registration (a "Demand Registration").
Seller's Registration Notice shall (i) specify the number of Worthington Shares
intended to be offered and sold (the "Registration Shares"); (ii) express the
present intention of Seller to offer or cause the offering of the Registration
Shares for distribution; (iii) describe the nature or method of the proposed
offer and sale of the Registration Shares, including the plan of distribution
therefor; (iv) contain the undertaking of Seller to provide all such information
and materials and take all such action as may be required in order to permit
Buyer to comply with all applicable requirements of the SEC and to obtain any
desired acceleration of the effective date of such registration statement. Buyer
shall be obligated to use its best efforts to keep any such registration
statement effective for the earlier of (i) twelve months from the date the
registration statement becomes effective or (ii) the Termination Date (as
defined in paragraph 2 below). Buyer will not be required to file and obtain
effectiveness for more than one registration statement pursuant to this
paragraph 1.
2. The obligation of Buyer to register any Worthington Shares
pursuant to a Demand Registration and to maintain the effectiveness of any
registration statement shall expire on the second anniversary of the Closing
Date (the "Termination Date").
3. The obligation of Buyer to use its best efforts to cause the
Worthington Shares to be registered under the Securities Act is subject to the
limitation that Buyer will be entitled to postpone for a reasonable period of
time, but not more than 90 days from the receipt of Seller's Registration
Notice, the filing of any registration statement if at the time it receives such
Registration Notice, Buyer, based on advice of its counsel, determines that such
registration and sale (i) would interfere with any financing, acquisition,
corporate reorganization or other material transaction involving Buyer or (ii)
would require the disclosure of material information and such disclosure would
adversely affect Buyer.
4. In connection with any Demand Registration, other than a
registration in connection with an underwritten offering, Buyer shall pay all
SEC and blue sky registration and filing fees, fees and disbursements of legal
counsel for Buyer, transfer agents' fees and fees and disbursements of any
public accountants used by Buyer in connection with such registration
(collectively, "Registration Expenses"); provided, however, that Registration
Expenses do not
74
include any of Seller's own expenses in connection with any Demand Registration,
including any fees and expenses of Seller's own counsel and any brokerage fees
or commissions or any underwriting discounts incurred in connection with
Seller's sale of Worthington Shares, all of which expenses will be paid by
Seller. If Seller seeks to offer and sell Worthington Shares in an underwritten
offering, Seller will pay (or reimburse Buyer for) all Registration Expenses in
excess of $15,000.
PROVISIONS APPLICABLE TO PIGGYBACK REGISTRATION
1. If Buyer, at any time prior to the second anniversary of the
Closing Date, proposes the registration under the Securities Act of an
underwritten offering for cash of any of its equity securities, Buyer shall give
notice of such proposed registration to Seller and shall use its best efforts to
include in such registration the sale of such number of Worthington Shares as
Seller shall request, within 14 days after the giving of such notice, upon the
same terms (including the method of distribution) as such offering; provided
that Buyer will not be required to provide notice to Seller or include in such
registration any Worthington Shares owned by Seller if the proposed registration
is primarily a registration of a stock option or other compensation plan or
securities issued or issuable pursuant to any such plan or a registration of
securities proposed to be issued in exchange for securities or assets of, or in
connection with a merger of consolidation with, another corporation (a
"Piggyback Registration").
2. In connection with any Piggyback Registration, if the managing
underwriters for such offering advise that the inclusion of all securities
sought to be registered may interfere with an orderly sale and distribution or
may materially adversely affect the price of such offering, the securities to be
registered shall be included in such registration in accordance with the
following priorities: first, all securities to be sold for the account of Buyer,
and second, all securities to be sold for the account of Seller and all other
selling shareholders (allocated pro rata based upon the number of shares that
Seller and such other selling shareholders desire to sell in such offering), up
to the limit specified by the managing underwriters.
3. The Registration Expenses in connection with any Piggyback
Registration shall be borne by Buyer.
PROVISIONS APPLICABLE TO DEMAND REGISTRATION AND PIGGYBACK REGISTRATION
1. The registration rights of Seller provided for in this
Schedule may not be transferred or assigned by Seller except to an affiliate of
Seller.
2. Anything contained herein to the contrary notwithstanding, the
registration rights of Seller provided for in this Schedule will terminate
immediately if Buyer engages in any transaction in which the outstanding shares
of Buyer cease to be publicly traded.
75
3. All capitalized terms used in this Schedule without definition
shall have the meanings given to them in the Asset Sale and Purchase Agreement
dated as of September 28, 1998 between Seller and Buyer.
76
EXHIBIT 1.27
TRADEMARK ASSIGNMENT
--------------------
WHEREAS, ▇▇▇▇▇▇-▇▇▇▇▇▇▇-Midland Company ("Assignor"), a Delaware
corporation, with an address of ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, is
the owner of the trademarks, registrations and applications identified in the
attached Schedule;
WHEREAS, Worthington Foods, Inc. ("Assignee"), an Ohio corporation,
with an address of ▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, is acquiring
from Assignor these trademarks, registrations and applications;
NOW, THEREFORE, in exchange for good and valuable consideration, the
receipt of which is hereby acknowledged, Assignor hereby transfers and assigns
to Assignee all of Assignor's rights, title and interest in and to the
trademarks, registrations and applications identified in the attached Schedule,
together with the goodwill of the business associated with these trademarks,
registrations and applications.
The rights transferred by this assignment include the right to bring
all legal actions related to the trademarks, registrations and applications,
including actions for any infringement of these, no matter whether the
infringement occurred before or after the assignment, and the right to recover
damages for such infringement.
IN WITNESS WHEREOF, the Assignor has executed this instrument on this
______ day of ______________, 1998.
▇▇▇▇▇▇-▇▇▇▇▇▇▇-MIDLAND COMPANY
By: ___________________________________
Name: _________________________________
Title: ________________________________
STATE OF ___________ )
)SS
COUNTY OF___________ )
The foregoing instrument was acknowledged before me this _____ day of
_____________, 1998 by _____________, _______________ of ▇▇▇▇▇▇-▇▇▇▇▇▇▇-Midland
Company. He is personally known to me.
(SEAL) _________________________________
Notary Public
State of_________________________
77
EXHIBIT 3.01(a)(1)
▇▇▇▇ OF SALE
------------
▇▇▇▇ OF SALE, dated _______________, 1998, given by ▇▇▇▇▇▇-▇▇▇▇▇▇▇-
Midland Company, a Delaware corporation ("Seller"), to Worthington Foods, Inc.,
an Ohio corporation ("Buyer").
WHEREAS, Seller and Buyer have entered into the Asset Sale and Purchase
Agreement dated September 25, 1998 (the "Sale Agreement") providing for, among
other things, the sale by Seller of the Business and Acquired Assets to Buyer
and the purchase by Buyer of the Business and Acquired Assets from Seller (terms
used but not defined herein shall have the meanings ascribed to them in the Sale
Agreement); and
WHEREAS, Section 3.01 (a)(i) of the Sale Agreement provides for Seller
to execute and deliver to Buyer a ▇▇▇▇ of sale conveying to Buyer all of
Seller's right, title and interest in and to the Business and Acquired Assets;
NOW, THEREFORE, on the terms and subject to the conditions of the Sale
Agreement, and for valuable consideration, the receipt and sufficiency of which
are hereby acknowledged:
Seller hereby sells and assigns to Buyer, and transfers
ownership to Buyer of, all of its right, title and interest in
and to the Business and Acquired Assets.
IN WITNESS WHEREOF, Seller has executed this ▇▇▇▇ of Sale on the date
first written above.
▇▇▇▇▇▇-▇▇▇▇▇▇▇-MIDLAND COMPANY
By: ___________________________________
Name: _________________________________
Title: ________________________________
STATE OF ___________ )
)SS
COUNTY OF___________ )
The foregoing instrument was acknowledged before me this ____ day of
_______,1998 by _______________, the _______________, of ▇▇▇▇▇▇-▇▇▇▇▇▇▇-Midland
Company. He is personally known to me.
My Commission Expires: ___________________________________
Notary Public, State of____________