1
EXHIBIT 1.1
$200,000,000
PILGRIM'S PRIDE CORPORATION
9 5/8% Senior Notes due 2011
UNDERWRITING AGREEMENT
August 6, 2001
Credit Suisse First Boston Corporation
▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇ Incorporated
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated
▇.▇. ▇▇▇▇▇▇ Securities Inc.
As Representatives of the several Underwriters
named in Schedule I hereto
c/o Credit Suisse First Boston Corporation
▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Ladies and Gentlemen:
Pilgrim's Pride Corporation, a Delaware corporation (the "COMPANY"),
proposes to issue and sell $200,000,000 principal amount of its 9 5/8% Senior
Notes due 2011 (the "SECURITIES") to the several underwriters named in Schedule
I hereto (the "UNDERWRITERS"). The Securities are to be issued pursuant to the
provisions of an Indenture to be dated as of August 9, 2001 (the "INDENTURE"),
and a First Supplemental Indenture to be dated as of August 9, 2001 (the
"SUPPLEMENTAL INDENTURE"). Unless otherwise noted, reference to the "Indenture"
in this Agreement refers to the Indenture, as amended by the Supplemental
Indenture, each between the Company and The Chase Manhattan Bank, as Trustee
(the "TRUSTEE").
SECTION 1. Registration Statement and Prospectus. The Company has prepared
and filed with the Securities and Exchange Commission (the "COMMISSION") in
accordance with the provisions of the Securities Act of 1933, as amended, and
the rules and regulations of the Commission thereunder (collectively, the
"ACT"), (i) a registration statement on Form S-3 in connection with the offer
and sale of up to $400,000,000 in aggregate public offering price of the
Company's debt securities, shares of serial preferred stock, par value $.01 per
share, shares of its Class A Common Stock, par value $.01 per share, and/or
shares of its Class B Common Stock,
2
par value $.01 per share (Registration No. 333-84861), and (ii) a preliminary
prospectus supplement relating to the Securities. The registration statement, as
amended at the time it became effective, including the information (if any)
deemed to be part of the registration statement at the time of effectiveness
pursuant to Rule 430A under the Act, is hereinafter referred to as the
"REGISTRATION STATEMENT"; and the prospectus in the form first used to confirm
sales of Securities, including any amendments or supplements thereto, is
hereinafter referred to as the "PROSPECTUS" (including, in the case of all
references to the Registration Statement or the Prospectus, documents
incorporated therein by reference). If the Company has filed or is required
pursuant to the terms hereof to file a registration statement pursuant to Rule
462(b) under the Act registering additional 9 5/8% Senior Notes due 2011 (a
"RULE 462(b) REGISTRATION STATEMENT"), then, unless otherwise specified, any
reference herein to the term "REGISTRATION STATEMENT" shall be deemed to include
such Rule 462(b) Registration Statement. The terms "supplement" and "amendment,"
"amend" or "amended" as used in this Agreement with respect to the Registration
Statement or the Prospectus shall include all documents subsequently filed by
the Company with the Commission pursuant to the Securities Exchange Act of 1934,
as amended, and the rules and regulations of the Commission thereunder
(collectively, the "EXCHANGE ACT") that are deemed to be incorporated by
reference in the Prospectus.
SECTION 2. Agreements to Sell and Purchase. On the basis of the
representations and warranties contained in this Agreement, and subject to its
terms and conditions, the Company agrees to issue and sell, and each Underwriter
agrees, severally and not jointly, to purchase from the Company, the principal
amount of Securities set forth opposite the name of such Underwriter in Schedule
I hereto at 97.69275% of the principal amount thereof (the "PURCHASE PRICE").
SECTION 3. Terms of Public Offering. The Company is advised by you that the
Underwriters propose (i) to make a public offering of their respective portions
of the Securities as soon after the execution and delivery of this Agreement as
in your judgment is advisable and (ii) initially to offer the Securities upon
the terms set forth in the Prospectus.
SECTION 4. Delivery and Payment. The Securities shall be represented by a
definitive certificate or certificates and shall be issued in such authorized
denominations and registered in the name of Cede & Co. or such other names as
the Representatives shall request no later than two business days prior to the
Closing Date (as defined below). The Company shall deliver the Securities, with
any transfer taxes thereon duly paid by the Company, to the Representatives
through the facilities of The Depository Trust Company ("DTC"), for the
respective accounts of the several Underwriters, against payment to the Company
of the Purchase Price therefore by wire transfer of Federal or other funds
immediately available in New York City. The certificates representing the
Securities shall be made available for inspection not later than 9:30 A.M., New
York City time, on the business day prior to the Closing Date (as defined
below), at the office of DTC or its designated custodian (the "DESIGNATED
OFFICE"). The time and date of delivery and payment for the Securities shall be
9:00 A.M., New York City time, on August 9, 2001 or such other time on the same
or such other date as the Representatives and the Company shall agree in
writing. The time and date of such delivery and payment are hereinafter referred
to as the "CLOSING DATE".
The documents to be delivered on the Closing Date on behalf of the
parties hereto pursuant to Section 8 of this Agreement shall be delivered at the
offices of Weil, Gotshal &
2
3
▇▇▇▇▇▇ LLP, ▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇, and the
Securities shall be delivered at the Designated Office, all on the Closing Date.
SECTION 5. Agreements of the Company. The Company agrees with you:
(a) To advise you promptly and, if requested by you, to confirm such
advice in writing, (i) of any request by the Commission for amendments to the
Registration Statement or amendments or supplements to the Prospectus or for
additional information, (ii) of the issuance by the Commission of any stop order
suspending the effectiveness of the Registration Statement or of the suspension
of qualification of the Securities for offering or sale in any jurisdiction, or
the initiation of any proceeding for such purposes, (iii) when any amendment to
the Registration Statement becomes effective, (iv) if the Company is required to
file a Rule 462(b) Registration Statement after the effectiveness of this
Agreement, when the Rule 462(b) Registration Statement has become effective, and
(v) of the happening of any event during the period referred to in Section 5(d)
below which makes any statement of a material fact made in the Registration
Statement or the Prospectus untrue or which requires any additions to or changes
in the Registration Statement or the Prospectus in order to make the statements
therein not misleading. If at any time the Commission shall issue any stop order
suspending the effectiveness of the Registration Statement, the Company will use
its best efforts to obtain the withdrawal or lifting of such order at the
earliest possible time.
(b) To furnish to you five signed copies of the Registration Statement
as first filed with the Commission and of each amendment to it, including all
exhibits and documents incorporated therein by reference, and to furnish to you
and each Underwriter designated by you such number of conformed copies of the
Registration Statement as so filed and of each amendment to it, without exhibits
but including documents incorporated therein by reference, as you may reasonably
request.
(c) To prepare the Prospectus, the form and substance of which shall be
reasonably satisfactory to you, and to file the Prospectus in such form with the
Commission within the applicable period specified in Rule 424(b) under the Act;
during the period specified in Section 5(d) below, not to file any further
amendment to the Registration Statement and not to make any amendment or
supplement to the Prospectus of which you shall not previously have been advised
or to which you shall reasonably object after being so advised; and, during such
period, to prepare and file with the Commission, promptly upon your reasonable
request, any amendment to the Registration Statement or amendment or supplement
to the Prospectus which may be necessary or advisable in connection with the
distribution of the Securities by you, and to use its best efforts to cause any
such amendment to the Registration Statement to become promptly effective.
(d) Prior to 10:00 A.M., New York City time, on the second business day
after the date of this Agreement and from time to time thereafter for such
period as in the opinion of counsel for the Underwriters a prospectus is
required by law to be delivered in connection with sales by an Underwriter or a
dealer, to furnish in New York City to each Underwriter and any dealer as many
copies of the Prospectus (and of any amendment or supplement to the Prospectus)
and any documents incorporated therein by reference as such Underwriter or
dealer may reasonably request.
3
4
(e) If during the period specified in Section 5(d), any event shall
occur or condition shall exist as a result of which, in the opinion of counsel
for the Underwriters, it becomes necessary to amend or supplement the Prospectus
in order to make the statements therein, in the light of the circumstances when
the Prospectus is delivered to a purchaser, not misleading, or if, in the
opinion of counsel for the Underwriters, it is necessary to amend or supplement
the Prospectus to comply with applicable law, forthwith to prepare and, subject
to Section 5(c), file with the Commission an appropriate amendment or supplement
to the Prospectus so that the statements in the Prospectus, as so amended or
supplemented, will not in the light of the circumstances when it is so
delivered, be misleading, or so that the Prospectus will comply with applicable
law, and to furnish to each Underwriter and to any dealer as many copies thereof
as such Underwriter or dealer may reasonably request.
(f) Prior to any public offering of the Securities, to cooperate with
you and counsel for the Underwriters in connection with the registration or
qualification of the Securities for offer and sale by the several Underwriters
and by dealers under the state securities or Blue Sky laws of such jurisdictions
as you may request, to continue such registration or qualification in effect so
long as required for distribution of the Securities and to file such consents to
service of process or other documents as may be necessary in order to effect
such registration or qualification; provided, however, that the Company shall
not be required in connection therewith to qualify as a foreign corporation in
any jurisdiction in which it is not now so qualified or to take any action that
would subject it to general consent to service of process or taxation other than
as to matters and transactions relating to the Prospectus, the Registration
Statement, any preliminary prospectus or the offering or sale of the Securities,
in any jurisdiction in which it is not now so subject.
(g) To make generally available to its security holders as soon as
practicable an earnings statement covering the twelve-month period ending
September 30, 2002 that shall satisfy the provisions of Section 11(a) of the
Act, and to advise you in writing when such statement has been so made
available.
(h) So long as the Securities are outstanding and the information
referred to in clauses (i) and (ii) is not required to be filed with the
Commission, (i) to mail and make generally available as soon as practicable
after the end of each fiscal year to the record holders of the Securities a
financial report of the Company and its subsidiaries on a consolidated basis
(and a similar financial report of all unconsolidated subsidiaries, if any), all
such financial reports to include a consolidated balance sheet, a consolidated
statement of operations, a consolidated statement of cash flows and a
consolidated statement of shareholders' equity as of the end of and for such
fiscal year, together with comparable information as of the end of and for the
preceding year, certified by independent public accountants and (ii) to mail and
make generally available as soon as practicable after the end of each quarterly
period (except for the last quarterly period of each fiscal year) to such
holders, a consolidated balance sheet, a consolidated statement of operations
and a consolidated statement of cash flows (and similar financial reports of all
unconsolidated subsidiaries, if any) as of the end of and for such period, and
for the period from the beginning of such year to the close of such quarterly
period, together with comparable information for the corresponding periods of
the preceding year. Notwithstanding the foregoing, the Company shall not be
required to mail or make generally available any financial reports of
4
5
unconsolidated subsidiaries unless such reports would be required to be filed
with the Commission (assuming always that the Company is a public company).
(i) So long as the Securities are outstanding, upon your request, to
furnish to you as soon as available copies of all reports or other
communications furnished to its security holders or furnished to or filed with
the Commission or any national securities exchange on which any class of
securities of the Company is listed and such other publicly available
information concerning the Company and its subsidiaries as you may reasonably
request.
(j) Whether or not the transactions contemplated in this Agreement are
consummated or this Agreement is terminated, to pay or cause to be paid all
expenses incident to the performance of its obligations under this Agreement,
including: (i) the fees, disbursements and expenses of the Company's counsel and
the Company's accountants in connection with the registration and delivery of
the Securities under the Act and all other fees and expenses in connection with
the preparation, printing, filing and distribution of the Registration Statement
(including financial statements and exhibits), any preliminary prospectus, the
Prospectus and all amendments and supplements to any of the foregoing prior to
or during the period specified in Section 5(d), including the mailing and
delivering of copies thereof to the Underwriters and dealers in the quantities
specified herein, (ii) all costs and expenses related to the transfer and
delivery of the Securities to the Underwriters, including any transfer or other
taxes payable thereon, (iii) all costs of printing or producing this Agreement
and any other agreements or documents prepared and delivered by you or your
counsel with the consent of the Company in connection with the offering,
purchase, sale or delivery of the Securities, (iv) all expenses in connection
with the registration or qualification of the Securities for offer and sale
under the securities or Blue Sky laws of the several states and all costs of
printing or producing any Preliminary and Supplemental Blue Sky Memoranda in
connection therewith (including the filing fees and fees and disbursements of
counsel for the Underwriters in connection with such registration or
qualification and memoranda relating thereto), (v) the filing fees and
disbursements of counsel for the Underwriters in connection with the review and
clearance of the offering of the Securities by the National Association of
Securities Dealers, Inc., (vi) the cost of printing certificates representing
the Securities, (vii) the costs and charges of any transfer agent, registrar
and/or depositary (including the Depository Trust Company), (viii) any fees
charged by rating agencies for the rating of the Securities, (ix) the fees and
expenses of the Trustee and the Trustee's counsel in connection with the
Indenture and the Securities and (x) all other costs and expenses incident to
the performance of the obligations of the Company hereunder for which provision
is not otherwise made in this Section.
(k) During the period beginning on the date hereof and continuing to
and including the Closing Date, not to offer, sell, contract to sell or
otherwise transfer or dispose of any debt securities of the Company or any
warrants, rights or options to purchase or otherwise acquire debt securities of
the Company substantially similar to the Securities (other than (i) the
Securities and (ii) commercial paper issued in the ordinary course of business),
without the prior written consent of the Representatives.
(l) Not to voluntarily claim, and to actively resist any attempts to
claim, the benefit of any usury laws against the holders of the Securities.
5
6
(m) To use the proceeds from the sale of the Securities in the manner
described in the Prospectus under the caption "Use of Proceeds" and
contemporaneously with the closing hereunder to irrevocably deposit with the
1993 Trustee (hereinafter defined) as trust funds in trust, specifically pledged
as security for, and dedicated solely to, the benefit of the holders of the
10 7/8% Notes (hereinafter defined), money in an amount equal to the redemption
price of the 10 7/8% Notes (including all accrued and unpaid interest through
the redemption date).
(n) To use its best efforts to do and perform all things required or
necessary to be done and performed under this Agreement by the Company prior to
the Closing Date and to satisfy all conditions precedent to the delivery of the
Securities.
(o) If the Registration Statement at the time of the effectiveness of
this Agreement does not cover all of the Securities, to file a Rule 462(b)
Registration Statement with the Commission registering the Securities not so
covered in compliance with Rule 462(b) by 10:00 P.M., New York City time, on the
date of this Agreement and to pay to the Commission the filing fee for such Rule
462(b) Registration Statement at the time of the filing thereof or to give
irrevocable instructions for the payment of such fee pursuant to Rule 111(b)
under the Act.
SECTION 6. Representations and Warranties of the Company. The Company
represents and warrants to each Underwriter that:
(a) The Registration Statement has become effective (other than any
Rule 462(b) Registration Statement to be filed by the Company after the
effectiveness of this Agreement); any Rule 462(b) Registration Statement filed
after the effectiveness of this Agreement will become effective no later than
10:00 P.M., New York City time, on the date of this Agreement; and no stop order
suspending the effectiveness of the Registration Statement is in effect, and no
proceedings for such purpose are pending before or threatened by the Commission.
(b) (i) Each document, if any, filed pursuant to the Exchange Act and
incorporated by reference in the Prospectus complied or will comply when so
filed in all material respects with the Exchange Act; (ii) the Registration
Statement (other than any Rule 462(b) Registration Statement to be filed by the
Company after the effectiveness of this Agreement), when it became effective,
did not contain and, as amended, if applicable, will not contain, any untrue
statement of a material fact or omit to state a material fact required to be
stated therein or necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading, (iii) the Registration
Statement (other than any Rule 462(b) Registration Statement to be filed by the
Company after the effectiveness of this Agreement) and the Prospectus comply
and, as amended or supplemented, if applicable, will comply in all material
respects with the Act, (iv) if the Company is required to file a Rule 462(b)
Registration Statement after the effectiveness of this Agreement, such Rule
462(b) Registration Statement and any amendments thereto, when they become
effective (A) will not contain any untrue statement of a material fact or omit
to state a material fact required to be stated therein or necessary to make the
statements therein, in light of the circumstances under which they will be made,
not misleading and (B) will comply in all material respects with the Act and
(iv) the Prospectus does not contain and, as amended or supplemented, if
applicable, will not contain any untrue statement of a material fact or omit to
state a material fact necessary to make the statements therein, in the light of
the circumstances under which they were made, not misleading, except
6
7
that the representations and warranties set forth in this paragraph do not apply
to statements or omissions in the Registration Statement or the Prospectus based
upon information relating to any Underwriter furnished to the Company in writing
by such Underwriter through you expressly for use therein.
(c) Each preliminary prospectus filed as part of the Registration
Statement as originally filed or as part of any amendment thereto, or filed
pursuant to Rule 424 under the Act, complied or will comply when so filed in all
material respects with the Act, and did not and will not contain an untrue
statement of a material fact or omit to state a material fact required to be
stated therein or necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading, except that the
representations and warranties set forth in this paragraph do not apply to
statements or omissions in any preliminary prospectus based upon information
relating to any Underwriter furnished to the Company in writing by such
Underwriter through you expressly for use therein.
(d) Each of the Company and its subsidiaries is a corporation, limited
partnership or business trust that has been duly formed, is validly existing and
in good standing under the laws of its jurisdiction of organization and has the
power and authority to carry on its business as described in the Prospectus and
to own, lease and operate its properties, and each is duly qualified and is in
good standing as a foreign corporation, limited partnership or business trust
authorized to do business in each jurisdiction in which the nature of its
business or its ownership or leasing of property requires such qualification,
except where the failure to be so qualified would not have a material adverse
effect on the business, prospects, financial condition or results of operations
of the Company and its subsidiaries, taken as a whole.
(e) There are no outstanding subscriptions, rights, warrants, options,
calls, convertible securities, commitments of sale or liens granted or issued by
the Company or any of its subsidiaries relating to or entitling any person to
purchase or otherwise to acquire any ownership interest in the Company or any of
its subsidiaries, except as otherwise disclosed in the Registration Statement.
(f) All the outstanding shares of capital stock of the Company have
been duly authorized and validly issued and are fully paid, non-assessable and
not subject to any preemptive or similar rights.
(g) The entities listed on Schedule II hereto are the only
subsidiaries, direct or indirect, of the Company. All of the outstanding shares
of capital stock, partnership interests or other ownership interests, as
applicable, of each of the Company's subsidiaries have been duly authorized and
validly issued and are fully paid and non-assessable, and are owned by the
Company, directly or indirectly (except as set forth on Schedule II hereto)
through one or more subsidiaries, free and clear of any security interest,
claim, lien, encumbrance or adverse interest of any nature (each, a "LIEN"),
except as disclosed in the Prospectus.
(h) The Indenture has been duly qualified under the Trust Indenture Act
of 1939, as amended (the "TRUST INDENTURE ACT"), and at the Closing will have
been duly authorized, executed and delivered by the Company and be a valid and
binding agreement of the Company, enforceable in accordance with its terms
except as (A) the enforceability thereof may be limited
7
8
by bankruptcy, insolvency or similar laws affecting creditors' rights generally
and (B) rights of acceleration and the availability of equitable remedies may be
limited by equitable principles of general applicability.
(i) The Securities have been duly authorized and, on the Closing Date,
will have been validly executed and delivered by the Company. When the
Securities have been executed and authenticated in accordance with the
provisions of the Indenture and delivered to and paid for by the Underwriters in
accordance with the terms of this Agreement, the Securities will be entitled to
the benefits of the Indenture and will be valid and binding obligations of the
Company, enforceable in accordance with their terms except as (A) the
enforceability thereof may be limited by bankruptcy, insolvency or similar laws
affecting creditors' rights generally and (B) rights of acceleration and the
availability of equitable remedies may be limited by equitable principles of
general applicability.
(j) The Securities conform as to legal matters to the description
thereof contained in the Prospectus.
(k) Neither the Company nor any of its subsidiaries is in violation of
its respective charter or by-laws or in default in the performance of any
obligation, agreement, covenant or condition contained in any indenture, loan
agreement, mortgage, lease or other agreement or instrument that is material to
the Company and its subsidiaries, taken as a whole, to which the Company or any
of its subsidiaries is a party or by which the Company or any of its
subsidiaries or their respective property is bound.
(l) The Company has all requisite corporate power and authority to
effect the redemption of the 10 7/8% Senior Subordinated Notes due 2003 of the
Company (the "10 7/8% NOTES") issued under that certain Indenture, dated as of
June 3, 1993 (the "1993 INDENTURE"), between the Company and Ameritrust Texas
National Association, as trustee (the "1993 TRUSTEE"), and such redemption has
been duly authorized by all necessary corporate action on the part of the
Company. At or before the closing, the Company shall have delivered to the 1993
Trustee irrevocable instructions to mail, no later than one day following the
Closing Date, an irrevocable notice of redemption with respect to the 10 7/8%
Notes to the holders thereof setting a redemption date of no later than
September 20, 2001, all in accordance with the terms of the 1993 Indenture.
(m) The Company has all requisite corporate power and authority to
execute and deliver the First Amendment to Credit Agreement, amending the
Revolving Credit Agreement, by and among Pilgrim's Pride, S.A. de C.V., Avicola
Pilgrim's Pride de Mexico, S.A. de C.V., the Company and Comerica Bank, dated
March 9, 1998 (the "FIRST AMENDMENT TO CREDIT AGREEMENT") and to perform its
obligations thereunder. The execution, delivery and performance of the First
Amendment to Credit Agreement by the Company and the consummation by the Company
of the transactions contemplated thereby have been duly authorized by all
necessary action on the part of the Company. The First Amendment to Credit
Agreement has been duly executed and delivered by the Company, and constitutes a
valid and binding agreement, enforceable in accordance with its terms, subject
to applicable bankruptcy, insolvency, fraudulent conveyance, reorganization,
moratorium and other similar laws affecting creditors' rights and remedies
generally, and subject, as to enforceability, to general principles of
8
9
equity, including principles of commercial reasonableness, good faith and fair
dealing (regardless of whether enforcement is sought in a proceeding at law or
in equity).
(n) The Company has all requisite corporate power and authority to
effect the repayment of amounts outstanding under the Amended and Restated
Credit Agreement by and among CoBank, ACB, individually and as Agent, Farm
Credit Services of America, FLCA, and other Banks thereunder, dated November 16,
2000 (the "COBANK FACILITY"), and such repayments have been duly authorized by
all necessary corporate action on the part of the Company.
(o) The execution, delivery and performance of this Agreement, the
Indenture, the Securities and the First Amendment to Credit Agreement by the
Company, the compliance by the Company with all the provisions hereof and
thereof, and the consummation of the transactions contemplated hereby and
thereby, including the repayment of amounts outstanding under the CoBank
Facility as described in the Prospectus, and the redemption of the 10 7/8% Notes
as described in the Prospectus, will not (i) require any consent, approval,
authorization or other order of, or qualification with, any court or
governmental body or agency (except (x) such as may be required under the
securities or Blue Sky laws of the various states or (y) any consent under the
Securities Act which has already been obtained), (ii) conflict with or
constitute a breach of any of the terms or provisions of, or a default under,
(A) the charter or by-laws of the Company or any of its subsidiaries or (B) any
indenture, loan agreement, mortgage, lease or other agreement or instrument to
which the Company or any of its subsidiaries is a party or by which the Company
or any of its subsidiaries or their respective property is bound except for
breaches or defaults that would not be material to the business, prospects,
financial condition or results of operations of the Company and its
subsidiaries, taken as a whole, (iii) (assuming compliance with all applicable
state securities or Blue Sky laws, rules and regulations) violate or conflict
with any applicable law or any rule, regulation, judgment, order or decree of
any court or any governmental body or agency having jurisdiction over the
Company, any of its subsidiaries or their respective property, (iv) result in
the imposition or creation of (or the obligation to create or impose) a Lien
under any agreement or instrument to which the Company or any of its
subsidiaries is a party or by which the Company or any of its subsidiaries or
their respective property is bound or (v) result in the suspension, termination
or revocation of any Authorization (as defined below) of the Company or any of
its subsidiaries or any other impairment of the rights of the holder of any such
Authorization.
(p) There are no legal or governmental proceedings pending or
threatened to which the Company or any of its subsidiaries is or could be a
party or to which any of their respective property is or could be subject that
are required to be described in the Registration Statement or the Prospectus and
are not so described as required; nor are there any statutes, regulations,
contracts or other documents that are required to be described in the
Registration Statement or the Prospectus or to be filed as exhibits to the
Registration Statement that are not so described or filed as required.
(q) Neither the Company nor any of its subsidiaries has violated any
foreign, federal, state or local law or regulation relating to the protection of
human health and safety, the environment or hazardous or toxic substances or
wastes, pollutants or contaminants ("ENVIRONMENTAL LAWS"), any provisions of the
Employee Retirement Income Security Act of
9
10
1974, as amended, or any provisions of the Foreign Corrupt Practices Act or the
rules and regulations promulgated thereunder, except for such violations which,
singly or in the aggregate, would not have a material adverse effect on the
business, prospects, financial condition or results of operation of the Company
and its subsidiaries, taken as a whole.
(r) Each of the Company and its subsidiaries has such permits,
licenses, consents, exemptions, franchises, authorizations and other approvals
(each, an "AUTHORIZATION") of, and has made all filings with and notices to, all
governmental or regulatory authorities and self-regulatory organizations and all
courts and other tribunals, including, without limitation, under any applicable
Environmental Laws, as are necessary to own, lease, license and operate its
respective properties and to conduct its business, except where the failure to
have any such Authorization or to make any such filing or notice would not,
singly or in the aggregate, have a material adverse effect on the business,
prospects, financial condition or results of operations of the Company and its
subsidiaries, taken as a whole. Each such Authorization is valid and in full
force and effect and each of the Company and its subsidiaries is in compliance
with all the terms and conditions thereof and with the rules and regulations of
the authorities and governing bodies having jurisdiction with respect thereto;
and no event has occurred (including, without limitation, the receipt of any
notice from any authority or governing body) which allows or, after notice or
lapse of time or both, would allow, revocation, suspension or termination of any
such Authorization or results or, after notice or lapse of time or both, would
result in any other impairment of the rights of the holder of any such
Authorization; and such Authorizations contain no restrictions that are
burdensome to the Company or any of its subsidiaries; except where such failure
to be valid and in full force and effect or to be in compliance, the occurrence
of any such event or the presence of any such restriction would not, singly or
in the aggregate, have a material adverse effect on the business, prospects,
financial condition or results of operations of the Company and its
subsidiaries, taken as a whole.
(s) There are no costs or liabilities associated with Environmental
Laws (including, without limitation, any capital or operating expenditures
required for clean-up, closure of properties or compliance with Environmental
Laws or any Authorization, any related constraints on operating activities and
any potential liabilities to third parties) which would, singly or in the
aggregate, have a material adverse effect on the business, prospects, financial
condition or results of operations of the Company and its subsidiaries, taken as
a whole.
(t) This Agreement has been duly authorized, executed and delivered by
the Company.
(u) Except as otherwise set forth in the Prospectus or such as are not
material to the business, prospects, financial condition or results of
operations of the Company and its subsidiaries considered as a whole, the
Company and its subsidiaries have good and marketable title in fee simple to all
real property and good and marketable title to all personal property owned by
them which is material to the business of the Company and its subsidiaries, in
each case free and clear of all Liens and defects; and any real property and
buildings held under lease by the Company and its subsidiaries are held by them
under valid, subsisting and enforceable leases with such exceptions as are not
material and do not interfere with the use made and proposed to be made of such
property and buildings by the Company and its subsidiaries, in each case except
as described in the Prospectus.
10
11
(v) The Company and each of its subsidiaries are insured by insurers of
recognized financial responsibility against such losses and risks and in such
amounts as are prudent and customary in the businesses in which they are
engaged; and neither the Company nor any of its subsidiaries (i) has received
notice from any insurer or agent of such insurer that substantial capital
improvements or other material expenditures will have to be made in order to
continue such insurance or (ii) has any reason to believe that it will not be
able to renew its existing insurance coverage as and when such coverage expires
or to obtain similar coverage from similar insurers at a cost that would not
have a material adverse effect on the business, prospects, financial conditions
or results of operations of the Company and its subsidiaries, taken as a whole.
(w) Ernst & Young LLP are independent public accountants with respect
to the Company and its subsidiaries as required by the Act.
(x) KPMG LLP are independent public accountants with respect to WLR
Foods, Inc. and its subsidiaries as required by the Act.
(y) The consolidated financial statements included (or otherwise
incorporated by reference) in the Registration Statement and the Prospectus (and
any amendment or supplement thereto), together with related schedules and notes,
present fairly in all material respects the consolidated financial position,
results of operations and changes in financial position of the Company and its
subsidiaries on the basis stated therein at the respective dates or for the
respective periods to which they apply; such statements and related schedules
and notes have been prepared in accordance with generally accepted accounting
principles consistently applied throughout the periods involved, except as
disclosed therein; and the other financial and statistical information and data
set forth in the Registration Statement and the Prospectus (and any amendment or
supplement thereto) are, in all material respects, accurately presented and
prepared on a basis consistent with such financial statements and the books and
records of the Company.
(z) The pro forma financial statements of the Company and its
subsidiaries and the related notes thereto included in the Registration
Statement and the Prospectus (and any supplement or amendment thereto) have been
prepared on a basis consistent with the historical financial statements of the
Company and its subsidiaries and give effect to assumptions used in the
preparation thereof on a reasonable basis and in good faith and present fairly
the historical and proposed transactions contemplated by the Registration
Statement and the Prospectus. Such pro forma financial statements (other than
the financial information presented for the last twelve months ended June 30,
2001) have been prepared in accordance with the applicable requirements of Rule
11-02 of Regulation S-X promulgated by the Commission. The other pro forma
financial and statistical information and data included in the Registration
Statement and the Prospectus (and any supplement or amendment thereto), are in
all material respects, accurately presented and prepared on a basis consistent
with the pro forma financial statements.
(aa) The Company is not and, after giving effect to the offering and
sale of the Securities and the application of the proceeds thereof as described
in the Prospectus, will not be, an "investment company" as such term is defined
in the Investment Company Act of 1940, as amended.
11
12
(bb) There are no contracts, agreements or understandings between the
Company and any person granting such person the right to require the Company to
file a registration statement under the Act with respect to any securities of
the Company or to require the Company to include such securities with the
Securities registered pursuant to the Registration Statement.
(cc) No "nationally recognized statistical rating organization" as such
term is defined for purposes of Rule 436(g)(2) under the Act has indicated to
the Company that it is considering (i) the downgrading, suspension or withdrawal
of, or any review for a possible change that does not indicate the direction of
the possible change in, any rating assigned to the Company or any securities of
the Company or (ii) any change in the outlook for any rating of the Company or
any securities of the Company.
(dd) Since the respective dates as of which information is given in the
Prospectus other than as set forth in the Prospectus (exclusive of any
amendments or supplements thereto subsequent to the date of this Agreement), (i)
there has not occurred any material adverse change or any development involving
a prospective material adverse change in the condition, financial or otherwise,
or the earnings, business, management or operations of the Company and its
subsidiaries, taken as a whole, (ii) there has not been any material adverse
change or any development involving a prospective material adverse change in the
capital stock or in the long-term debt of the Company or any of its subsidiaries
and (iii) neither the Company nor any of its subsidiaries has incurred any
material liability or obligation, direct or contingent.
(ee) Each certificate signed by any officer of the Company and
delivered to the Underwriters or counsel for the Underwriters shall be deemed to
be a representation and warranty by the Company to the Underwriters as to the
matters covered thereby.
SECTION 7. Indemnification.
(a) The Company agrees to indemnify and hold harmless each Underwriter,
its directors, its officers and each person, if any, who controls any
Underwriter within the meaning of Section 15 of the Act or Section 20 of the
Exchange Act, from and against any and all losses, claims, damages, liabilities
and judgments (including, without limitation, any legal or other expenses
incurred in connection with investigating or defending any matter, including any
action, that could give rise to any such losses, claims, damages, liabilities or
judgments) caused by any untrue statement or alleged untrue statement of a
material fact contained in the Registration Statement (or any amendment
thereto), the Prospectus (or any amendment or supplement thereto) or any
preliminary prospectus, or caused by any omission or alleged omission to state
therein a material fact required to be stated therein or necessary to make the
statements therein not misleading, except insofar as such losses, claims,
damages, liabilities or judgments are caused by any such untrue statement or
omission or alleged untrue statement or omission based upon information relating
to any Underwriter furnished in writing to the Company by such Underwriter
through you expressly for use therein; provided, however, that the foregoing
indemnity agreement with respect to any preliminary prospectus shall not inure
to the benefit of any Underwriter who failed to deliver a Prospectus, as then
amended or supplemented, (so long as the Prospectus and any amendment or
supplement thereto was provided by the Company to the several Underwriters in
the requisite quantity and on a timely basis to permit
12
13
proper delivery on or prior to the Closing Date) to the person asserting any
losses, claims, damages, liabilities or judgements caused by any untrue
statement or alleged untrue statement of a material fact contained in the
preliminary prospectus, or caused by any omission or alleged omission to state
therein a material fact required to be stated therein or necessary to make the
statements therein not misleading, if such material misstatement or omission or
alleged material misstatement or omission was cured in the Prospectus, as so
amended or supplemented, and such Prospectus was required by law to be delivered
at or prior to the written confirmation of the sale to such person.
(b) Each Underwriter agrees, severally and not jointly, to indemnify
and hold harmless the Company, its directors, its officers who sign the
Registration Statement and each person, if any, who controls the Company within
the meaning of Section 15 of the Act or Section 20 of the Exchange Act, to the
same extent as the foregoing indemnity from the Company to such Underwriter but
only with reference to information relating to such Underwriter furnished in
writing to the Company by such Underwriter through you expressly for use in the
Registration Statement (or any amendment thereto), the Prospectus (or any
amendment or supplement thereto) or any preliminary prospectus.
(c) In case any action shall be commenced involving any person in
respect of which indemnity may be sought pursuant to Section 7(a) or 7(b) (the
"indemnified party"), the indemnified party shall promptly notify the person
against whom such indemnity may be sought (the "indemnifying party") in writing;
provided, however, that the failure to notify the indemnifying party shall not
relieve it from any liability which it may have under this Section 7 except to
the extent it has been materially prejudiced by such failure and, provided
further, that the failure to notify the indemnifying party shall not relieve it
from any liability which it may have to an indemnified party otherwise than
under this Section 7. The indemnifying party shall assume the defense of such
action, including the employment of counsel reasonably satisfactory to the
indemnified party and the payment of all fees and expenses of such counsel, as
incurred (except that in the case of any action in respect of which indemnity
may be sought pursuant to both Sections 7(a) and 7(b), the Underwriter shall not
be required to assume the defense of such action pursuant to this Section 7(c),
but may employ separate counsel and participate in the defense thereof, but the
fees and expenses of such counsel, except as provided below, shall be at the
expense of such Underwriter). Any indemnified party shall have the right to
employ separate counsel in any such action and participate in the defense
thereof, but the fees and expenses of such counsel shall be at the expense of
the indemnified party unless (i) the employment of such counsel shall have been
specifically authorized in writing by the indemnifying party, (ii) the
indemnifying party shall have failed to assume the defense of such action or
employ counsel reasonably satisfactory to the indemnified party or (iii) the
named parties to any such action (including any impleaded parties) include both
the indemnified party and the indemnifying party, and the indemnified party
shall have been advised by such counsel that there may be one or more legal
defenses available to it which are different from or additional to those
available to the indemnifying party (in which case the indemnifying party shall
not have the right to assume the defense of such action on behalf of the
indemnified party). In any such case, the indemnifying party shall not, in
connection with any one action or separate but substantially similar or related
actions in the same jurisdiction arising out of the same general allegations or
circumstances, be liable for the fees and expenses of more than one separate
firm of attorneys (in addition to any local counsel) for all indemnified parties
and all such fees and expenses shall be reimbursed as
13
14
they are incurred. Such firm shall be designated in writing by the
Representatives, in the case of parties indemnified pursuant to Section 7(a),
and by the Company, in the case of parties indemnified pursuant to Section 7(b).
The indemnifying party shall indemnify and hold harmless the indemnified party
from and against any and all losses, claims, damages, liabilities and judgments
by reason of any settlement of any action (i) effected with its written consent
or (ii) effected without its written consent if the settlement is entered into
more than twenty business days after the indemnifying party shall have received
a request from the indemnified party for reimbursement for the fees and expenses
of counsel (in any case where such fees and expenses are at the expense of the
indemnifying party) and, prior to the date of such settlement, the indemnifying
party shall have failed to comply with such reimbursement request. No
indemnifying party shall, without the prior written consent of the indemnified
party, effect any settlement or compromise of, or consent to the entry of
judgment with respect to, any pending or threatened action in respect of which
the indemnified party is or could have been a party and indemnity or
contribution may be or could have been sought hereunder by the indemnified
party, unless such settlement, compromise or judgment (i) includes an
unconditional release of the indemnified party from all liability on claims that
are or could have been the subject matter of such action and (ii) does not
include a statement as to or an admission of fault, culpability or a failure to
act, by or on behalf of the indemnified party.
(d) To the extent the indemnification provided for in this Section 7 is
unavailable to an indemnified party or insufficient in respect of any losses,
claims, damages, liabilities or judgments referred to therein, then each
indemnifying party, in lieu of indemnifying such indemnified party, shall
contribute to the amount paid or payable by such indemnified party as a result
of such losses, claims, damages, liabilities and judgments (i) in such
proportion as is appropriate to reflect the relative benefits received by the
Company on the one hand and the Underwriters on the other hand from the offering
of the Securities or (ii) if the allocation provided by clause 7(d)(i) above is
not permitted by applicable law, in such proportion as is appropriate to reflect
not only the relative benefits referred to in clause 7(d)(i) above but also the
relative fault of the Company on the one hand and the Underwriters on the other
hand in connection with the statements or omissions which resulted in such
losses, claims, damages, liabilities or judgments, as well as any other relevant
equitable considerations. The relative benefits received by the Company on the
one hand and the Underwriters on the other hand shall be deemed to be in the
same proportion as the total net proceeds from the offering (after deducting
underwriting discounts and commissions but before deducting expenses) received
by the Company, and the total underwriting discounts and commissions received by
the Underwriters, bear to the total price to the public of the Securities, in
each case as set forth in the table on the cover page of the Prospectus. The
relative fault of the Company on the one hand and the Underwriters on the other
hand shall be determined by reference to, among other things, whether the untrue
or alleged untrue statement of a material fact or the omission or alleged
omission to state a material fact relates to information supplied by the Company
or the Underwriters and the parties' relative intent, knowledge, access to
information and opportunity to correct or prevent such statement or omission.
The Company and the Underwriters agree that it would not be just and
equitable if contribution pursuant to this Section 7(d) were determined by pro
rata allocation (even if the Underwriters were treated as one entity for such
purpose) or by any other method of allocation which does not take account of the
equitable considerations referred to in the immediately
14
15
preceding paragraph. The amount paid or payable by an indemnified party as a
result of the losses, claims, damages, liabilities or judgments referred to in
the immediately preceding paragraph shall be deemed to include, subject to the
limitations set forth above, any legal or other expenses incurred by such
indemnified party in connection with investigating or defending any matter,
including any action, that could have given rise to such losses, claims,
damages, liabilities or judgments. Notwithstanding the provisions of this
Section 7, no Underwriter shall be required to contribute any amount in excess
of the amount by which the total price at which the Securities underwritten by
it and distributed to the public were offered to the public exceeds the amount
of any damages which such Underwriter has otherwise been required to pay by
reason of such untrue or alleged untrue statement or omission or alleged
omission. No person guilty of fraudulent misrepresentation (within the meaning
of Section 11(f) of the Act) shall be entitled to contribution from any person
who was not guilty of such fraudulent misrepresentation. The Underwriters'
obligations to contribute pursuant to this Section 7(d) are several in
proportion to the respective principal amount of Securities purchased by each of
the Underwriters hereunder and not joint.
(e) The remedies provided for in this Section 7 are not exclusive and
shall not limit any rights or remedies which may otherwise be available to any
indemnified party at law or in equity.
SECTION 8. Conditions of Underwriters' Obligations. The several obligations
of the Underwriters to purchase the Securities under this Agreement are subject
to the satisfaction of each of the following conditions:
(a) All the representations and warranties of the Company contained in
this Agreement shall be true and correct on the date hereof and on the Closing
Date with the same force and effect as if made on and as of the Closing Date.
(b) If the Company is required to file a Rule 462(b) Registration
Statement after the effectiveness of this Agreement, such Rule 462(b)
Registration Statement shall have become effective by 10:00 P.M., New York City
time, on the date of this Agreement; and no stop order suspending the
effectiveness of the Registration Statement shall have been issued and no
proceedings for that purpose shall have been commenced or shall be pending
before or, to the knowledge of the Company, contemplated by the Commission.
(c) On or after the date hereof, (i) there shall not have occurred any
downgrading, suspension or withdrawal of, nor shall any notice have been given
of any potential or intended downgrading, suspension or withdrawal of, or of any
review (or of any potential or intended review) for a possible change that does
not indicate the direction of the possible change in, any rating of the Company
or any securities of the Company (including, without limitation, the placing of
any of the foregoing ratings on credit watch with negative or developing
implications or under review with an uncertain direction) by any "nationally
recognized statistical rating organization" as such term is defined for purposes
of Rule 436(g)(2) under the Act, (ii) there shall not have occurred any change,
nor shall any notice have been given of any potential or intended change, in the
outlook for any rating of the Company or any securities of the Company by any
such rating organization and (iii) no such rating organization shall have given
notice that
15
16
it has assigned (or is considering assigning) a lower rating to the Securities
than that on which the Securities were marketed.
(d) You shall have received on the Closing Date a certificate dated the
Closing Date, signed by ▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇ and ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, in their
capacities as the Chief Executive Officer and Chief Financial Officer,
respectively, of the Company, confirming the matters set forth in Sections 8(a),
8(b), 8(e) and 8(l) and, to their knowledge, 8(c), and that the Company has
complied with all of the agreements and satisfied all of the conditions herein
contained and required to be complied with or satisfied by the Company on or
prior to the Closing Date.
(e) Since the respective dates as of which information is given in the
Prospectus other than as set forth in the Prospectus (exclusive of any
amendments or supplements thereto subsequent to the date of this Agreement), (i)
there shall not have occurred any material adverse change or any development
involving a prospective material adverse change in the condition, financial or
otherwise, or the earnings, business, management or operations of the Company
and its subsidiaries, taken as a whole, (ii) there shall not have been any
material adverse change or any development involving a prospective material
adverse change in the capital stock or in the long-term debt of the Company or
any of its subsidiaries and (iii) neither the Company nor any of its
subsidiaries shall have incurred any liability or obligation, direct or
contingent, which is material to the Company and its subsidiaries taken as a
whole, other than those incurred in the ordinary course of business consistent
with past practice, the effect of which, in any such case described in clause
8(e)(i), 8(e)(ii) or 8(e)(iii), in your judgment, is material and adverse and,
in your judgment, makes it impracticable to market the Securities on the terms
and in the manner contemplated in the Prospectus.
(f) You shall have received on the Closing Date an opinion
(satisfactory to you and counsel for the Underwriters), dated the Closing Date,
of ▇▇▇▇▇ & ▇▇▇▇▇▇▇▇, counsel for the Company, to the effect that:
(i) each of the Company and its subsidiaries is a corporation,
limited partnership or business trust validly existing and, in the case of any
such corporation or business trust, in good standing under the laws of its
jurisdiction of incorporation or formation and has the power and authority to
carry on its business as described in the Prospectus and to own, lease and
operate its properties;
(ii) the Company is duly qualified and is in good standing as a
foreign corporation in the States of Arkansas, Oklahoma, Texas, Virginia and
North Carolina;
(iii) to such counsel's knowledge, all of the outstanding shares
of capital stock, partnership interests or other ownership interests, as
applicable, of each of the Company's subsidiaries are owned by the Company
(except as set forth on Schedule II), directly or indirectly through one or more
subsidiaries, free and clear of any Lien; and all of the outstanding shares of
capital stock of each of the Company's corporate subsidiaries have been duly
authorized and validly issued and are fully paid and non-assessable;
16
17
(iv) the Securities have been duly authorized and, when executed
and authenticated in accordance with the provisions of the Indenture and
delivered to and paid for by the Underwriters in accordance with the terms of
this Agreement, will be entitled to the benefits of the Indenture and will be
valid and binding obligations of the Company, enforceable in accordance with
their terms, subject to applicable bankruptcy, insolvency, fraudulent
conveyance, reorganization, moratorium and similar laws affecting creditors'
rights and remedies generally, and subject, as to enforceability, to general
principles of equity, including principles of commercial reasonableness, good
faith and fair dealing (regardless of whether enforcement is sought in a
proceeding at law or in equity);
(v) the Indenture has been duly qualified under the Trust
Indenture Act and has been duly authorized, executed and delivered by the
Company and is a valid and binding agreement of the Company, enforceable in
accordance with its terms, subject to applicable bankruptcy, insolvency,
fraudulent conveyance, reorganization, moratorium and similar laws affecting
creditors' rights and remedies generally, and subject, as to enforceability, to
general principles of equity, including principles of commercial reasonableness,
good faith and fair dealing (regardless of whether enforcement is sought in a
proceeding at law or in equity);
(vi) this Agreement has been duly authorized, executed and
delivered by the Company;
(vii) the redemption of the 10 7/8% Notes has been duly
authorized;
(viii) the First Amendment to Credit Agreement has been duly
authorized, executed and delivered by the Company;
(ix) based solely upon telephonic confirmation from the
Commission, the Registration Statement has become effective under the Act and,
to such counsel's knowledge, no stop order suspending its effectiveness has been
issued and no proceedings for that purpose are pending before or contemplated by
the Commission;
(x) the statements under the captions "Description of Other
Indebtedness" and "Description of Notes" in the Prospectus and Item 15 of Part
II of the Registration Statement, insofar as such statements constitute a
summary of the legal matters, documents or proceedings referred to therein,
fairly present the information called for with respect to such legal matters,
documents and proceedings;
(xi) the execution, delivery and performance of this Agreement,
the Indenture, the Securities and the First Amendment to Credit Agreement by the
Company, the compliance by the Company with all the provisions hereof and
thereof and the consummation of the transactions contemplated hereby and
thereby, including the repayment of amounts outstanding under the CoBank
Facility as described in the Prospectus and the redemption of the 10 7/8% Notes
as described in the Prospectus, will not (A) require any consent, approval,
authorization or other order of, or qualification with, any federal, Delaware
corporate or Texas court or governmental body or agency (except such as may be
required under the securities or Blue Sky laws of the various states), (B)
violate or constitute a breach of any of the terms or provisions of, or a
default under, (1) the charter or by-laws of the Company or any of its
17
18
subsidiaries or (2) any indenture, loan agreement, mortgage, lease or other
agreement or instrument that is material to the Company and its subsidiaries,
taken as a whole, to which the Company or any of its subsidiaries is a party or
by which the Company or any of its subsidiaries or their respective property is
bound and of which such counsel is aware, except for violations, breaches or
defaults which could not reasonably be expected to have a material adverse
effect on the business, properties or financial condition of the Company and its
subsidiaries, taken as a whole, (C) violate any applicable federal, Delaware
corporate or Texas law, rule or regulation (other than federal or state
securities or Blue Sky laws, rules or regulations, as to which such counsel need
express no opinion) or, to such counsel's knowledge, any judgment, order or
decree of any court or any governmental body or agency having jurisdiction over
the Company, any of its subsidiaries or their respective property, or (D) to
such counsel's knowledge, result in the imposition or creation of (or the
obligation to create or impose) a Lien under any agreement or instrument to
which the Company or any of its subsidiaries is a party or by which the Company
or any of its subsidiaries or their respective property is bound;
(xii) such counsel does not know of any legal or governmental
proceedings pending or threatened to which the Company or any of its
subsidiaries is or could be a party or to which any of their respective property
is or could be subject that are required to be described in the Registration
Statement or the Prospectus and are not so described as required, or of any
statutes, regulations, contracts or other documents that are required to be
described in the Registration Statement or the Prospectus or to be filed as
exhibits to the Registration Statement that are not so described or filed as
required;
(xiii) the Company is not and, after giving effect to the
offering and sale of the Securities and the application of the proceeds thereof
as described in the Prospectus, will not be, an "investment company" as such
term is defined in the Investment Company Act of 1940, as amended;
(xiv) to such counsel's knowledge, there are no contracts,
agreements or understandings between the Company and any person granting such
person the right to require the Company to file a registration statement under
the Act with respect to any securities of the Company or to require the Company
to include such securities with the Securities registered pursuant to the
Registration Statement; and
(xv) (A) each document, if any, filed pursuant to the Exchange
Act and incorporated by reference in the Prospectus (except for financial
statements and other financial data included therein as to which no opinion need
be expressed) complied when so filed as to form in all material respects with
the Exchange Act; and (B) the Registration Statement and the Prospectus and any
supplement or amendment thereto (except for the financial statements and other
financial data included therein as to which no opinion need be expressed) comply
as to form in all material respects with the Act.
Such counsel shall also state that they have participated in
conferences with directors, officers and other representatives of the Company,
representatives of the independent public accountants for the Company,
representatives of the Underwriters, and counsel for the Underwriters, at which
conferences the contents of the Registration Statement, as amended, the
Prospectus and related matters were discussed, and although
18
19
such counsel have not independently verified and are not passing upon and assume
no responsibility for the accuracy, completeness or fairness of the statements
contained in the Registration Statement, as amended, or the Prospectus, no facts
have come to such counsel's attention that lead such counsel to believe that the
Registration Statement, as amended, on the effective date thereof or the date
hereof, contained any untrue statement of a material fact or omitted to state a
material fact required to be stated therein or necessary to make the statements
contained therein not misleading, or that the Prospectus, on the date thereof or
on the Closing Date, contained or contains any untrue statement of a material
fact or omitted or omits to state a material fact required to be stated therein
or necessary to make the statements contained therein, in light of the
circumstances under which they were made, not misleading (it being understood
that such counsel need express no view with respect to the financial statements
and notes thereto, the financial statement schedules and the other financial,
accounting and statistical data included in the Registration Statement, as
amended, or the Prospectus).
Such counsel may state in such opinion that the opinions contained
therein are limited to the federal laws of the United States of America, the
laws of the State of Texas and the General Corporation Law of the State of
Delaware, except in the case of the opinions expressed in paragraph (i) above,
which shall also include the federal laws of Mexico, and in the case of the
opinions expressed in paragraphs (iv), (v), (vi) and (xi) above, which shall
also include the laws of the State of New York. Insofar as any of the matters
described in Sections 8(f)(i) and (iii) are governed by federal or state laws of
Mexico, the opinions with respect to such matters may be rendered by Von Wobeser
Y Sierra, S.C. Any such opinion shall state therein that it is being rendered to
you at the request of the Company.
In rendering such opinion, such counsel may rely (i) as to factual
matters (including materiality) upon certificates of appropriate officers of the
Company and (ii) as to matters governed by the federal laws of Mexico, on
counsel in such jurisdiction.
The opinion of ▇▇▇▇▇ & ▇▇▇▇▇▇▇▇ described in Section 8(f) above shall
be rendered to you at the request of the Company and shall so state therein.
(g) You shall have received on the Closing Date an opinion, dated the
Closing Date, of Weil, Gotshal & ▇▇▇▇▇▇ LLP, counsel for the Underwriters, as to
the matters referred to in Sections 8(f)(iv), 8(f)(v), 8(f)(vi) and 8(f)(x) (but
only with respect to the statements under the caption "Description of Notes" and
"Underwriting") and clause 8(f)(xv)(B).
Such counsel shall also state that they have participated in
conferences with directors, officers and other representatives of the Company,
and representatives of the independent public accountants and counsel for the
Company, at which conferences the contents of the Registration Statement, as
amended, the Prospectus and related matters were discussed, and although such
counsel have not independently verified and are not passing upon and assume no
responsibility for the accuracy, completeness or fairness of the statements
contained in the Registration Statement, as amended, or the Prospectus, no facts
have come to such counsel's attention that lead such counsel to believe that the
Registration Statement, as amended, on the effective date thereof or the
19
20
date hereof, contained any untrue statement of a material fact or omitted to
state a material fact required to be stated therein or necessary to make the
statements contained therein not misleading, or that the Prospectus, on the date
thereof or on the Closing Date, contained or contains any untrue statement of a
material fact or omitted or omits to state a material fact required to be stated
therein or necessary to make the statements contained therein, in light of the
circumstances under which they were made, not misleading (it being understood
that such counsel need express no view with respect to the financial statements
and notes thereto, the financial statement schedules and the other financial,
accounting and statistical data included in the Registration Statement, as
amended, or the Prospectus or any of the documents incorporated by reference
into the Registration Statement, as amended).
(h) You shall have received, on each of the date hereof and the Closing
Date, a letter dated the date hereof or the Closing Date, as the case may be, in
form and substance satisfactory to you, from Ernst & Young LLP, independent
public accountants, containing the information and statements of the type
ordinarily included in accountants' "comfort letters" to Underwriters with
respect to the financial statements and certain financial information contained
in or incorporated by reference into the Registration Statement and the
Prospectus.
(i) You shall have received, on each of the date hereof and the Closing
Date, a letter dated the date hereof or the Closing Date, as the case may be, in
form and substance satisfactory to you, from KPMG LLP, independent public
accountants, containing the information and statements of the type ordinarily
included in accountants' "comfort letters" to Underwriters with respect to the
financial statements and certain financial information contained in or
incorporated by reference into the Registration Statement and the Prospectus.
(j) The Securities shall have been rated "BB-" by Standard & Poor's
Corporation and "Ba3" by ▇▇▇▇▇'▇ Investors Service, Inc.
(k) The Underwriters shall have received a counterpart, conformed as
executed, of the Indenture which shall have been entered into by the Company and
the Trustee.
(l) The Company shall not have failed on or prior to the Closing Date
to perform or comply with any of the agreements herein contained and required to
be performed or complied with by the Company on or prior to the Closing Date.
SECTION 9. Effectiveness of Agreement and Termination. This Agreement shall
become effective upon the execution and delivery of this Agreement by the
parties hereto.
This Agreement may be terminated at any time on or prior to the Closing
Date by you by written notice to the Company if any of the following has
occurred: (i) any outbreak or escalation of hostilities or other national or
international calamity or crisis or change in economic conditions or in the
financial markets that, in your judgment, is material and adverse and, in your
judgment, makes it impracticable to market the Securities on the terms and in
the manner contemplated in the Prospectus, (ii) the suspension or material
limitation of trading in securities or other instruments on the New York Stock
Exchange, the American Stock Exchange, the Chicago Board of
20
21
Options Exchange, the Chicago Mercantile Exchange, the Chicago Board of Trade or
the Nasdaq National Market or limitation on prices for securities or other
instruments on any such exchange or the Nasdaq National Market, (iii) the
suspension of trading of any securities of the Company on any exchange or in the
over-the-counter market, (iv) the enactment, publication, decree or other
promulgation of any federal or state statute, regulation, rule or order of any
court or other governmental authority which in your opinion materially and
adversely affects, or will materially and adversely affect, the business,
prospects, financial condition or results of operations of the Company and its
subsidiaries, taken as a whole, (v) the declaration of a banking moratorium by
either federal or New York State authorities or (vi) the taking of any action by
any federal, state or local government or agency in respect of its monetary or
fiscal affairs which in your opinion has a material adverse effect on the
financial markets in the United States.
If on the Closing Date any one or more of the Underwriters shall fail
or refuse to purchase the Securities which it or they have agreed to purchase
hereunder on such date and the aggregate principal amount of Securities which
such defaulting Underwriter or Underwriters agreed but failed or refused to
purchase is not more than one-tenth of the aggregate principal amount of
Securities to be purchased on such date by all Underwriters, each non-defaulting
Underwriter shall be obligated severally, in the proportion which the principal
amount of Securities set forth opposite its name in Schedule I bears to the
aggregate principal amount of Securities which all the non-defaulting
Underwriters have agreed to purchase, or in such other proportion as you may
specify, to purchase the Securities which such defaulting Underwriter or
Underwriters agreed but failed or refused to purchase on such date; provided
that in no event shall the aggregate principal amount of Securities which any
Underwriter has agreed to purchase pursuant to Section 2 hereof be increased
pursuant to this Section 9 by an amount in excess of one-ninth of such principal
amount of Securities without the written consent of such Underwriter. If on the
Closing Date any Underwriter or Underwriters shall fail or refuse to purchase
Securities and the aggregate principal amount of Securities with respect to
which such default occurs is more than one-tenth of the aggregate principal
amount of Securities to be purchased by all Underwriters and arrangements
satisfactory to you and the Company for purchase of such Securities are not made
within 48 hours after such default, this Agreement will terminate without
liability on the part of any non-defaulting Underwriter and the Company. In any
such case which does not result in termination of this Agreement, either you or
the Company shall have the right to postpone the Closing Date, but in no event
for longer than seven days, in order that the required changes, if any, in the
Registration Statement and the Prospectus or any other documents or arrangements
may be effected. Any action taken under this paragraph shall not relieve any
defaulting Underwriter from liability in respect of any default of any such
Underwriter under this Agreement.
SECTION 10. Miscellaneous. Notices given pursuant to any provision of this
Agreement shall be addressed as follows: (i) if to the Company, to Pilgrim's
Pride Corporation, ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇, Attention:
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ and (ii) if to any Underwriter, to the Representatives or to
you, c/o Credit Suisse First Boston Corporation, ▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇,
▇▇▇ ▇▇▇▇ ▇▇▇▇▇, Attention: Syndicate Department and ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co.
Incorporated, ▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, Attention: High Yield
Capital Markets Syndicate Desk, or in any case to such other address as the
person to be notified may have requested in writing.
21
22
The respective indemnities, contribution agreements, representations,
warranties and other statements of the Company and the several Underwriters set
forth in or made pursuant to this Agreement shall remain operative and in full
force and effect, and will survive delivery of and payment for the Securities,
regardless of (i) any investigation, or statement as to the results thereof,
made by or on behalf of any Underwriter, the officers or directors of any
Underwriter, any person controlling any Underwriter, the Company, the officers
or directors of the Company or any person controlling the Company, (ii)
acceptance of the Securities and payment for them hereunder and (iii)
termination of this Agreement.
If for any reason the Securities are not delivered by or on behalf of
the Company as provided herein (other than as a result of any termination of
this Agreement pursuant to Section 9), the Company agrees to reimburse the
several Underwriters for all out-of-pocket expenses (including the fees and
disbursements of counsel) incurred by them. Notwithstanding any termination of
this Agreement, the Company shall be liable for all expenses which it has agreed
to pay pursuant to Section 5(j) hereof. The Company also agrees to reimburse the
several Underwriters, their directors and officers and any persons controlling
any of the Underwriters for any and all fees and expenses (including, without
limitation, the fees disbursements of counsel) incurred by them in connection
with enforcing their rights hereunder (including, without limitation, pursuant
to Section 7 hereof).
Except as otherwise provided, this Agreement has been and is made
solely for the benefit of and shall be binding upon the Company, the
Underwriters, the Underwriters' directors and officers, any controlling persons
referred to herein, the Company's directors and the Company's officers who sign
the Registration Statement and their respective successors and assigns, all as
and to the extent provided in this Agreement, and no other person shall acquire
or have any right under or by virtue of this Agreement. The term "successors and
assigns" shall not include a purchaser of any of the Securities from any of the
several Underwriters merely because of such purchase.
This Agreement shall be governed and construed in accordance with the
laws of the State of New York.
This Agreement may be signed in various counterparts which together
shall constitute one and the same instrument.
22
23
Please confirm that the foregoing correctly sets forth the agreement
between the Company and the several Underwriters.
Very truly yours,
PILGRIM'S PRIDE CORPORATION
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
------------------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Executive Vice-President, Chief
Financial Officer, Secretary and Treasurer
CREDIT SUISSE FIRST BOSTON CORPORATION
▇▇▇▇▇▇▇ LYNCH, PIERCE, ▇▇▇▇▇▇ & ▇▇▇▇▇ INCORPORATED
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & CO. INCORPORATED
▇.▇. ▇▇▇▇▇▇ SECURITIES INC.
Acting severally on behalf of
themselves and the several
Underwriters named in
Schedule I hereto
By: CREDIT SUISSE FIRST BOSTON CORPORATION
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
----------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Managing Director
23
24
SCHEDULE I
PRINCIPAL AMOUNT OF
SECURITIES
UNDERWRITER TO BE PURCHASED
----------- -------------------
Credit Suisse First Boston Corporation ............................... $ 68,260,000
▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇ Incorporated ................... 43,880,000
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated .................................... 43,880,000
▇.▇. ▇▇▇▇▇▇ Securities Inc. .......................................... 30,420,000
▇.▇. ▇▇▇▇▇▇▇ & Sons, Inc. ............................................ 4,880,000
BMO ▇▇▇▇▇▇▇ ▇▇▇▇▇ Corp. .............................................. 4,340,000
SunTrust ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ Capital Markets, a division of SunTrust
Capital Markets, Inc. .............................................. 4,340,000
------------
Total ..................................... $200,000,000
============
25
SCHEDULE II
SUBSIDIARIES
Avicola Pilgrim's Pride de Mexico S.A. de C.V.
Compania Incubadora ▇▇▇▇▇▇▇ ▇.▇. de ▇.▇.
▇▇▇▇▇▇▇ Pesada S.A. de C.V. (52.6% owned by Compania Incubadora ▇▇▇▇▇▇▇ ▇.▇. de
C.V.)
Grupo Pilgrim's Pride Funding Holdings, S. de ▇.▇. de C.V.
Grupo Pilgrim's Pride Funding, S. de ▇.▇. de C.V.
Inmobliaria Avicola Pilgrim's Pride S. de ▇.▇.
▇▇▇▇▇▇▇'▇ Pride Affordable Housing Corp.
Pilgrim's Pride Funding Corp.
Pilgrim's Pride International Inc.
PPC Marketing, Ltd.
Pilgrim's Pride S.A. de C.V.
PPC of Delaware Business Trust
Rockingham Poultry, Inc.
Rockingham Poultry, Inc. (Foreign Sales Corp.)
Valley Rail Service, Inc.
▇▇▇▇▇▇▇ Supply Company, Inc.