EXHIBIT 4 (J)(9)
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GOLD ▇▇▇▇ INC.
NOTE PURCHASE AND PRIVATE SHELF AGREEMENT
$125,000,000
PRIVATE SHELF FACILITY
with an initial draw of
$30,000,000
7.60% SERIES A SENIOR NOTES DUE FEBRUARY 11, 2012
Dated as of February 11, 1997
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TABLE OF CONTENTS
PAGE
1. AUTHORIZATION OF ISSUE OF NOTES.................................. 1
1A. Authorization of Issue of Series A Notes.................... 1
1B. Authorization of Issue of Shelf Notes....................... 1
2. PURCHASE AND SALE OF NOTES....................................... 2
2A. Purchase and Sale of Series A Notes......................... 2
2B. Purchase and Sale of Shelf Notes............................ 3
3. CONDITIONS OF CLOSING............................................ 8
3A. Certain Documents........................................... 8
3B. Opinion of Purchaser's Special Counsel...................... 9
3C. Representations and Warranties; No Default.................. 10
3D. Purchase Permitted by Applicable Laws....................... 10
3E. Payment of Fees............................................. 10
4. PREPAYMENTS...................................................... 10
4A. Required Prepayments of Series A Notes...................... 10
4B. Required Prepayments of Shelf Notes......................... 11
4C. Optional Prepayment With Yield-Maintenance Amount........... 11
4D. Notice of Optional Prepayment............................... 11
4E. Application of Prepayments.................................. 11
4F. Retirement of Notes......................................... 12
5. AFFIRMATIVE COVENANTS............................................ 12
5A. Reporting Requirements...................................... 12
5B. Inspection of Property...................................... 16
5C. Covenant to Secure Notes Equally............................ 16
5D. Guaranteed Obligations...................................... 16
6. NEGATIVE COVENANTS............................................... 18
6A. Financial Covenants......................................... 18
6B. Limitation on Restricted Payments........................... 19
6C. Liens....................................................... 19
6D. Restrictions on Loans, Advances, Investments and
Contingent Liabilities...................................... 20
6E. Sale of Stock and Debt of Subsidiaries...................... 22
6F. Merger and Sale of Assets................................... 23
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6G. Sale and Lease-Back......................................... 24
6H. Sale or Discount of Receivables............................. 24
6I. Commodity Contracts......................................... 24
6J. Issuance of Stock by Restricted Subsidiaries................ 24
7. EVENTS OF DEFAULT................................................ 25
7A. Acceleration................................................ 25
7B. Rescission of Acceleration.................................. 28
7C. Notice of Acceleration or Rescission........................ 28
7D. Other Remedies.............................................. 29
8. REPRESENTATIONS, COVENANTS AND WARRANTIES........................ 29
8A. Organization and Qualification.............................. 29
8B. Financial Statements........................................ 29
8C. Actions Pending............................................. 30
8D. Outstanding Debt............................................ 30
8E. Title to Properties......................................... 30
8F. Taxes....................................................... 30
8G. Conflicting Agreements or Other Matters..................... 31
8H. Offering of Notes........................................... 31
8I. Use of Proceeds/Regulation G, Etc........................... 31
8J. ERISA....................................................... 32
8K. Foreign Assets Control Regulations.......................... 32
8L. Governmental Consent........................................ 32
8M. Possession of Franchises, Licenses, Etc..................... 33
8N. Pollution and Other Regulations............................. 33
8O. Disclosure.................................................. 33
8P. Hostile Tender Offers....................................... 33
9. REPRESENTATIONS OF THE PURCHASERS................................ 34
9A. Nature of Purchase.......................................... 34
9B. Source of Funds............................................. 34
10. DEFINITIONS; ACCOUNTING.......................................... 35
10A. Yield-Maintenance Terms..................................... 36
10B. Other Terms................................................. 37
10C. Accounting Principles, Terms and Determinations............. 52
11. MISCELLANEOUS.................................................... 52
11A. Note Payments............................................... 52
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11B. Expenses.................................................... 53
11C. Consent to Amendments....................................... 53
11D. Form, Registration, Transfer and Exchange of Notes;
Lost Notes.................................................. 54
11E. Persons Deemed Owners; Participations....................... 55
11F. Survival of Representations and Warranties; Entire
Agreement................................................... 55
11G. Successors and Assigns...................................... 56
11H. Independence of Covenants................................... 56
11I. Notices..................................................... 56
11J. Payments Due on Non-Business Days........................... 57
11K. Severability................................................ 57
11L. Descriptive Headings........................................ 57
11M. Satisfaction Requirement.................................... 57
11N. Governing Law............................................... 57
11O. Severalty of Obligations.................................... 58
11P. Counterparts................................................ 58
11Q. Binding Agreement........................................... 58
11R. Amendment of Other Agreements............................... 59
Purchaser Schedule
Information Schedule
Schedule 6C Liens
Schedule 6D Permitted Investments
Schedule 8G Debt Restrictions
Schedule 10B-1 Subordinated Debt
Schedule 10B-2 Subsidiaries
Exhibit A-1 Form of Series A Note
Exhibit A-2 Form of Shelf Note
Exhibit B Form of Request for Purchase
Exhibit C Form of Confirmation of Acceptance
Exhibit D-1 Form of Opinion for Series A Note
Exhibit D-2 Form of Opinion for Shelf Note
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GOLD ▇▇▇▇ INC.
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
As of February 11, 1997
The Prudential Insurance Company
of America ("PRUDENTIAL")
Each Prudential Affiliate (as hereinafter defined)
which becomes bound by certain provisions of
this Agreement as hereinafter provided (together
with Prudential, the "PURCHASERS")
c/o Prudential Capital Group
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
Ladies and Gentlemen:
The undersigned, GOLD ▇▇▇▇ INC. (herein called the "COMPANY"), hereby
agrees with you as follows:
1. AUTHORIZATION OF ISSUE OF NOTES.
1A. AUTHORIZATION OF ISSUE OF SERIES A NOTES. The Company will authorize
the issue of its senior promissory notes (the "SERIES A NOTES") in the aggregate
principal amount of $30,000,000, to be dated the date of issue thereof, to
mature February 11, 2012, to bear interest on the unpaid balance thereof from
the date thereof until the principal thereof shall have become due and payable
at the rate of 7.60% per annum and on overdue principal, Yield-Maintenance
Amount and interest at the rate specified therein, and to be substantially in
the form of Exhibit A-1 attached hereto. The terms "SERIES A NOTE" and "SERIES
A NOTES" as used herein shall include each Series A Note delivered pursuant to
any provision of this Agreement and each Series A Note delivered in substitution
or exchange for any such Series A Note pursuant to any such provision.
1B. AUTHORIZATION OF ISSUE OF SHELF NOTES. The Company will authorize the
issue of its additional senior promissory notes (the "SHELF NOTES") in the
aggregate principal amount of $95,000,000, to be dated the date of issue
thereof, to mature, in the case of each Shelf Note so issued, no more than 15
years after the date of original
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issuance thereof, to have an average life, in the case of each Shelf Note so
issued, of no more than 10 years after the date of original issuance thereof, to
bear interest on the unpaid balance thereof from the date thereof at the rate
per annum, and to have such other particular terms, as shall be set forth, in
the case of each Shelf Note so issued, in the Confirmation of Acceptance with
respect to such Shelf Note delivered pursuant to paragraph 2B(5), and to be
substantially in the form of Exhibit A-2 attached hereto. The terms "SHELF NOTE"
and "SHELF NOTES" as used herein shall include each Shelf Note delivered
pursuant to any provision of this Agreement and each Shelf Note delivered in
substitution or exchange for any such Shelf Note pursuant to any such provision.
The terms "NOTE" and "NOTES" as used herein shall include each Series A Note and
each Shelf Note delivered pursuant to any provision of this Agreement and each
Note delivered in substitution or exchange for any such Note pursuant to any
such provision. Notes which have (i) the same final maturity, (ii) the same
principal prepayment dates, (iii) the same principal prepayment amounts (as a
percentage of the original principal amount of each Note), (iv) the same
interest rate, (v) the same interest payment periods and (vi) the same date of
issuance (which, in the case of a Note issued in exchange for another Note,
shall be deemed for these purposes the date on which such Note's ultimate
predecessor Note was issued), are herein called a "SERIES" of Notes.
2. PURCHASE AND SALE OF NOTES.
2A. PURCHASE AND SALE OF SERIES A NOTES. The Company hereby agrees to
sell to Prudential and, subject to the terms and conditions herein set forth,
Prudential agrees to purchase from the Company $30,000,000 aggregate principal
amount of Series A Notes at 100% of such aggregate principal amount. On
February 11, 1997 or any other date prior to February 11, 1997 upon which the
Company and Prudential may agree (herein called the "SERIES A CLOSING DAY"), the
Company will deliver to Prudential at the offices of King & Spalding, 120 West
45th Street, New York, New York, one or more Series A Notes registered in its
name, evidencing the aggregate principal amount of Series A Notes to be
purchased by Prudential and in the denomination or denominations specified with
respect to Prudential in the Purchaser Schedule attached hereto, against payment
of the purchase price thereof by transfer of immediately available funds for
credit to the Company's account #▇▇▇▇▇▇▇▇ at Wachovia Bank of Georgia, ABA
Routing Number ▇▇▇▇▇▇▇▇▇.
2B. PURCHASE AND SALE OF SHELF NOTES.
2B(1). FACILITY. Prudential is willing to consider, in its sole
discretion and within limits which may be authorized for purchase by Prudential
and Prudential Affiliates from time to time, the purchase of Shelf Notes
pursuant to this Agreement.
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The willingness of Prudential to consider such purchase of Shelf Notes is herein
called the "FACILITY". At any time, the aggregate principal amount of Shelf
Notes stated in paragraph 1B, minus the aggregate principal amount of Shelf
Notes purchased and sold pursuant to this Agreement prior to such time, minus
the aggregate principal amount of Accepted Notes (as hereinafter defined) which
have not yet been purchased and sold hereunder prior to such time, is herein
called the "AVAILABLE FACILITY AMOUNT" at such time. NOTWITHSTANDING THE
WILLINGNESS OF PRUDENTIAL TO CONSIDER PURCHASES OF SHELF NOTES, THIS AGREEMENT
IS ENTERED INTO ON THE EXPRESS UNDERSTANDING THAT NEITHER PRUDENTIAL NOR ANY
PRUDENTIAL AFFILIATE SHALL BE OBLIGATED TO MAKE OR ACCEPT OFFERS TO PURCHASE
SHELF NOTES, OR TO QUOTE RATES, SPREADS OR OTHER TERMS WITH RESPECT TO SPECIFIC
PURCHASES OF SHELF NOTES, AND THE FACILITY SHALL IN NO WAY BE CONSTRUED AS A
COMMITMENT BY PRUDENTIAL OR ANY PRUDENTIAL AFFILIATE.
2B(2). ISSUANCE PERIOD. Shelf Notes may be issued and sold pursuant to
this Agreement until the earlier of:
(i) the second anniversary of the date of this Agreement (or if
any such anniversary is not a Business Day, the Business Day next preceding
such anniversary); and
(ii) the thirtieth day after Prudential shall have given to the
Company, or the Company shall have given to Prudential, a notice stating
that it elects to terminate the issuance and sale of Shelf Notes pursuant
to this Agreement (or if such thirtieth day is not a Business Day, the
Business Day next preceding such thirtieth day);
(iii) the last Closing Day after which there is no Available
Facility Amount;
(iv) the termination of the Facility under paragraph 7A; and
(v) the acceleration of any Note under paragraph 7A of this
Agreement.
The period during which Shelf Notes may be issued and sold pursuant to this
Agreement is herein called the "ISSUANCE PERIOD".
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2B(3). REQUEST FOR PURCHASE. The Company may from time to time during
the Issuance Period make requests for purchases of Shelf Notes (each such
request being herein called a "REQUEST FOR PURCHASE"). Each Request for
Purchase shall be made to Prudential by telecopier or overnight delivery
service, and shall (i) specify the aggregate principal amount of Shelf Notes
covered thereby, which shall not be less than $5,000,000 and not be greater than
the Available Facility Amount at the time such Request for Purchase is made,
(ii) specify the principal amounts, final maturities, principal prepayment dates
and amounts and interest payment periods (quarterly or semi-annual in arrears)
of the Shelf Notes covered thereby, (iii) specify the use of proceeds of such
Shelf Notes, (iv) specify the proposed day for the closing of the purchase and
sale of such Shelf Notes, which shall be a Business Day during the Issuance
Period not less than 10 days and not more than 25 days after the making of such
Request for Purchase, (v) specify the number of the account and the name and
address of the depository institution to which the purchase prices of such Shelf
Notes are to be transferred on the Closing Day for such purchase and sale, (vi)
certify that the representations and warranties contained in paragraph 8 are
true on and as of the date of such Request for Purchase and that there exists on
the date of such Request for Purchase no Event of Default or Default, (vii)
specify the Designated Spread for such Shelf Notes and (viii) be substantially
in the form of Exhibit B attached hereto. Each Request for Purchase shall be in
writing and shall be deemed made when received by Prudential.
2B(4). RATE QUOTES. Not later than five Business Days after the Company
shall have given Prudential a Request for Purchase pursuant to paragraph 2B(3),
Prudential may, but shall be under no obligation to, provide to the Company by
telephone or telecopier, in each case between 9:30 A.M. and 1:30 P.M. New York
City local time (or such later time as Prudential may elect) interest rate
quotes for the several principal amounts, maturities, principal prepayment
schedules, and interest payment periods of Shelf Notes specified in such Request
for Purchase. Each quote shall represent the interest rate per annum payable on
the outstanding principal balance of such Shelf Notes at which Prudential or a
Prudential Affiliate would be willing to purchase such Shelf Notes at 100% of
the principal amount thereof.
2B(5). ACCEPTANCE. Within 30 minutes after Prudential shall have
provided any interest rate quotes pursuant to paragraph 2B(4) or such shorter
period as Prudential may specify to the Company (such period herein called the
"ACCEPTANCE WINDOW"), the Company may, subject to paragraph 2B(6), elect to
accept such interest rate quotes as to not less than $5,000,000 aggregate
principal amount of the Shelf Notes specified in the related Request for
Purchase. Such election shall be made by an Authorized Officer of the Company
notifying Prudential by telephone or telecopier within the Acceptance Window
that the Company elects to accept such
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interest rate quotes, specifying the Shelf Notes (each such Shelf Note being
herein called an "ACCEPTED NOTE") as to which such acceptance (herein called a
"ACCEPTANCE") relates. The day the Company notifies Prudential of an Acceptance
with respect to any Accepted Notes is herein called the "ACCEPTANCE DAY" for
such Accepted Notes. Any interest rate quotes as to which Prudential does not
receive an Acceptance within the Acceptance Window shall expire, and no purchase
or sale of Shelf Notes hereunder shall be made based on such expired interest
rate quotes. Subject to paragraph 2B(6) and the other terms and conditions
hereof, the Company agrees to sell to Prudential or a Prudential Affiliate, and
Prudential agrees to purchase, or to cause the purchase by a Prudential
Affiliate of, the Accepted Notes at 100% of the principal amount of such Notes.
As soon as practicable following the Acceptance Day, the Company, Prudential and
each Prudential Affiliate which is to purchase any such Accepted Notes will
execute a confirmation of such Acceptance substantially in the form of Exhibit C
attached hereto (herein called a "CONFIRMATION OF ACCEPTANCE"). If the Company
should fail to execute and return to Prudential within three Business Days
following receipt thereof a Confirmation of Acceptance with respect to any
Accepted Notes, Prudential may at its election at any time prior to its receipt
thereof cancel the closing with respect to such Accepted Notes by so notifying
the Company in writing.
2B(6). MARKET DISRUPTION. Notwithstanding the provisions of paragraph
2B(5), if Prudential shall have provided interest rate quotes pursuant to
paragraph 2B(4) and thereafter prior to the time an Acceptance with respect to
such quotes shall have been notified to Prudential in accordance with paragraph
2B(5) the domestic market for U.S. Treasury securities or derivatives shall have
closed or there shall have occurred a general suspension, material limitation,
or significant disruption of trading in securities generally on the New York
Stock Exchange or in the domestic market for U.S. Treasury securities or
derivatives, then such interest rate quotes shall expire, and no purchase or
sale of Shelf Notes hereunder shall be made based on such expired interest rate
quotes. If the Company thereafter notifies Prudential of the Acceptance of any
such interest rate quotes, such Acceptance shall be ineffective for all purposes
of this Agreement, and Prudential shall promptly notify the Company that the
provisions of this paragraph 2B(6) are applicable with respect to such
Acceptance.
2B(7). FACILITY CLOSINGS. Not later than 11:30 A.M. (New York City
local time) on the Closing Day for any Accepted Notes, the Company will deliver
to each Purchaser listed in the Confirmation of Acceptance relating thereto at
the offices of the Prudential Capital Group, ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇, the Accepted Notes to be purchased by such Purchaser in the form
of one or more Notes in authorized denominations as such Purchaser may request
for each Series of Accepted Notes to be purchased on the Closing Day, dated the
Closing Day and
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registered in such Purchaser's name (or in the name of its nominee), against
payment of the purchase price thereof by transfer of immediately available funds
for credit to the Company's account specified in the Request for Purchase of
such Notes. If the Company fails to tender to any Purchaser the Accepted Notes
to be purchased by such Purchaser on the scheduled Closing Day for such Accepted
Notes as provided above in this paragraph 2B(7), or any of the conditions
specified in paragraph 3 shall not have been fulfilled by the time required on
such scheduled Closing Day, the Company shall, prior to 1:00 P.M., New York City
local time, on such scheduled Closing Day notify Prudential (which notification
shall be deemed received by each Purchaser) in writing whether (i) such closing
is to be rescheduled (such rescheduled date to be a Business Day during the
Issuance Period not less than one Business Day and not more than 10 Business
Days after such scheduled Closing Day (the "RESCHEDULED CLOSING DAY") and
certify to Prudential (which certification shall be for the benefit of each
Purchaser) that the Company reasonably believes that it will be able to comply
with the conditions set forth in paragraph 3 on such Rescheduled Closing Day and
that the Company will pay the Delayed Delivery Fee in accordance with paragraph
2B(8)(iii) or (ii) such closing is to be canceled. In the event that the Company
shall fail to give such notice referred to in the preceding sentence, Prudential
(on behalf of each Purchaser) may at its election, at any time after 1:00 P.M.,
New York City local time, on such scheduled Closing Day, notify the Company in
writing that such closing is to be canceled. Notwithstanding anything to the
contrary appearing in this Agreement, the Company may elect to reschedule a
closing with respect to any given Accepted Notes on not more than one occasion,
unless Prudential shall have otherwise consented in writing.
2B(8). FEES.
2B(8)(i) FACILITY FEE. At the time of the execution and delivery of this
Agreement by the Company and Prudential, the Company will pay to Prudential in
immediately available funds a fee (herein called the "FACILITY FEE") in the
amount of $75,000.
2B(8)(ii) ISSUANCE FEE. The Company will pay to Prudential in immediately
available funds a fee (herein called the "ISSUANCE FEE") on each Closing Day
occurring on or after May 11, 1997 (other than the Series A Closing Day) in an
amount equal to 0.125% of the aggregate principal amount of Notes sold on such
Closing Day.
2B(8)(iii) DELAYED DELIVERY FEE. If the closing of the purchase and sale
of any Accepted Note is delayed for any reason beyond the original Closing Day
for such Accepted Note, the Company will pay to Prudential (a) on the
Cancellation Date or
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actual closing date of such purchase and sale and (b) if earlier, the next
Business Day following 90 days after the Acceptance Day for such Accepted Note
and on each Business Day following 90 days after the prior payment hereunder, a
fee (herein called the "DELAYED DELIVERY FEE") calculated as follows:
(BEY - MMY) X DTS/360 X PA
where "BEY" means Bond Equivalent Yield, i.e., the bond equivalent yield per
annum of such Accepted Note, "MMY" means Money Market Yield, i.e., the yield per
annum on a commercial paper investment of the highest quality selected by
Prudential on the date Prudential receives notice of the delay in the closing
for such Accepted Note having a maturity date or dates the same as, or closest
to, the Rescheduled Closing Day or Rescheduled Closing Days (a new alternative
investment being selected by Prudential each time such closing is delayed);
"DTS" means Days to Settlement, i.e., the number of actual days elapsed from and
including the original Closing Day with respect to such Accepted Note (in the
case of the first such payment with respect to such Accepted Note) or from and
including the date of the next preceding payment (in the case of any subsequent
delayed delivery fee payment with respect to such Accepted Note) to but
excluding the date of such payment; and "PA" means Principal Amount, i.e., the
principal amount of the Accepted Note for which such calculation is being made.
In no case shall the Delayed Delivery Fee be less than zero. Nothing contained
herein shall obligate any Purchaser to purchase any Accepted Note on any day
other than the Closing Day for such Accepted Note, as the same may be
rescheduled from time to time in compliance with paragraph 2B(7).
2B(8)(iv) CANCELLATION FEE. If the Company at any time notifies Prudential
in writing that the Company is canceling the closing of the purchase and sale of
any Accepted Note, or if Prudential notifies the Company in writing under the
circumstances set forth in the last sentence of paragraph 2B(5) or the
penultimate sentence of paragraph 2B(7) that the closing of the purchase and
sale of such Accepted Note is to be canceled, or if the closing of the purchase
and sale of such Accepted Note is not consummated on or prior to the last day of
the Issuance Period (the date of any such notification, or the last day of the
Issuance Period, as the case may be, being herein called the "CANCELLATION
DATE"), the Company will pay the Purchasers in immediately available funds an
amount (the "CANCELLATION FEE") calculated as follows:
PI X PA
where "PI" means Price Increase, i.e., the quotient (expressed in decimals)
obtained by dividing (a) the excess of the ask price (as determined by
Prudential) of the Hedge
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Treasury Note(s) on the Cancellation Date over the bid price (as determined by
Prudential) of the Hedge Treasury Notes(s) on the Acceptance Day for such
Accepted Note by (b) such bid price; and "PA" has the meaning ascribed to it in
paragraph 2B(8)(iii). The foregoing bid and ask prices shall be as reported by
Telerate Systems, Inc. (or, if such data for any reason ceases to be available
through Telerate Systems, Inc., any publicly available source of similar market
data). Each price shall be based on a U.S. Treasury security having a par value
of $100.00 and shall be rounded to the second decimal place. In no case shall
the Cancellation Fee be less than zero.
3. CONDITIONS OF CLOSING. The obligation of any Purchaser to purchase
and pay for any Notes is subject to the satisfaction, on or before the Closing
Day for such Notes, of the following conditions:
3A. CERTAIN DOCUMENTS. Such Purchaser shall have received the following,
each dated the date of the applicable Closing Day:
(i) The Note(s) to be purchased by such Purchaser.
(ii) Certified copies of the resolutions of the Board of Directors of
the Company authorizing the execution and delivery of this Agreement and
the issuance of the Notes, and of all documents evidencing other necessary
corporate action and governmental approvals, if any, with respect to this
Agreement and the Notes.
(iii) A certificate of the Secretary or an Assistant Secretary and one
other officer of the Company certifying the names and true signatures of
the officers of the Company authorized to sign this Agreement and the
Notes and the other documents to be delivered hereunder.
(iv) Certified copies of the Certificate of Incorporation and By-laws
of the Company.
(v) A favorable opinion of ▇▇▇▇ ▇. ▇▇▇▇▇▇, Vice President, Law of
the Company and ▇▇▇▇▇▇ & Bird, special counsel to the Company (or such
other counsel designated by the Company and acceptable to the
Purchaser(s)) satisfactory to such Purchaser which when taken together
address the matters set forth in Exhibit D-1 (in the case of the Series A
Notes) or Exhibit D-2 (in the case of any Shelf Notes) attached hereto and
as to such other matters as such Purchaser may reasonably request. The
Company hereby directs each such counsel to deliver such opinion, agrees
that the issuance and sale of any Notes will constitute a reconfirmation
of such direction, and understands and
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agrees that each Purchaser receiving such an opinion will and is hereby
authorized to rely on such opinion.
(vi) A good standing certificate for the Company from the Secretary
of State of Georgia dated of a recent date and good standing or other
certificates of qualification to do business as a foreign corporation for
the States of Alabama, Arkansas, Florida, Georgia, Indiana, Kentucky,
Louisiana, Mississippi, New Hampshire, North Carolina, North Dakota, Ohio,
Oklahoma, South Carolina, Tennessee, Texas and Virginia.
(vii) Additional documents or certificates with respect to legal
matters or corporate or other proceedings related to the transactions
contemplated hereby as may be reasonably requested by such Purchaser.
3B. OPINION OF PURCHASER'S SPECIAL COUNSEL. Such Purchaser shall have
received from King & Spalding or such other counsel who is acting as special
counsel for it in connection with this transaction, a favorable opinion
satisfactory to such Purchaser as to such matters incident to the matters herein
contemplated as it may reasonably request.
3C. REPRESENTATIONS AND WARRANTIES; NO DEFAULT. The representations and
warranties contained in paragraph 8 shall be true on and as of such Closing Day,
except to the extent of changes caused by the transactions herein contemplated;
there shall exist on such Closing Day no Event of Default or Default; and the
Company shall have delivered to such Purchaser an Officer's Certificate, dated
such Closing Day, to both such effects.
3D. PURCHASE PERMITTED BY APPLICABLE LAWS. The purchase of and payment
for the Notes to be purchased by such Purchaser on the terms and conditions
herein provided (including the use of the proceeds of such Notes by the Company)
shall not violate any applicable law or governmental regulation (including,
without limitation, Section 5 of the Securities Act or Regulation G, T or X of
the Board of Governors of the Federal Reserve System) and shall not subject such
Purchaser to any tax, penalty, liability or other onerous condition under or
pursuant to any applicable law or governmental regulation, and such Purchaser
shall have received such certificates or other evidence as it may request to
establish compliance with this condition.
3E. PAYMENT OF FEES. The Company shall have paid to Prudential any fees
due it pursuant to or in connection with this Agreement, including any Facility
Fee
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due pursuant to paragraph 2B(8)(i), any Issuance Fee due pursuant to paragraph
2B(8)(ii) and any Delayed Delivery Fee due pursuant to paragraph 2B(8)(iii).
4. PREPAYMENTS. The Series A Notes and any Shelf Notes shall be subject
to required prepayment as and to the extent provided in paragraphs 4A and 4B,
respectively. The Series A Notes and any Shelf Notes shall also be subject to
prepayment under the circumstances set forth in paragraph 4C. Any prepayment
made by the Company pursuant to any other provision of this paragraph 4 shall
not reduce or otherwise affect its obligation to make any required prepayment as
specified in paragraph 4A or 4B.
4A. REQUIRED PREPAYMENTS OF SERIES A NOTES. Until the Series A Notes shall
be paid in full, the Company shall apply to the prepayment of the Series A
Notes, without Yield-Maintenance Amount, the sum of $2,727,272.73 commencing on
February 11, 2002 and each February 11 thereafter to and including February 11,
2012, and such principal amounts of the Series A Notes, together with interest
thereon to the payment dates, shall become due on such payment dates. The
remaining unpaid principal amount of the Series A Notes, together with interest
accrued thereon, shall become due on the maturity date of the Series A Notes.
4B. REQUIRED PREPAYMENTS OF SHELF NOTES. Each Series of Shelf Notes shall
be subject to required prepayments, if any, set forth in the Notes of such
Series.
4C. OPTIONAL PREPAYMENT WITH YIELD-MAINTENANCE AMOUNT. The Notes of each
Series shall be subject to prepayment, in whole at any time or from time to time
in part (in integral multiples of $100,000 and in a minimum amount of
$1,000,000), at the option of the Company, at 100% of the principal amount so
prepaid plus interest thereon to the prepayment date and the Yield-Maintenance
Amount, if any, with respect to each such Note. Any partial prepayment of a
Series of the Notes pursuant to this paragraph 4C(1) shall be applied in
satisfaction of required payments of principal in inverse order of their
scheduled due dates.
4D. NOTICE OF OPTIONAL PREPAYMENT. The Company shall give the holder of
each Note of a Series to be prepaid pursuant to paragraph 4C irrevocable written
notice of such prepayment not less than 10 Business Days prior to the prepayment
date, specifying such prepayment date, the aggregate principal amount of the
Notes of such Series to be prepaid on such date, the principal amount of the
Notes of such Series held by such holder to be prepaid on that date and that
such prepayment is to be made pursuant to paragraph 4C. Notice of prepayment
having been given as aforesaid, the principal amount of the Notes specified in
such notice, together with interest thereon to the prepayment date and together
with the Yield-Maintenance
11
Amount, if any, herein provided, shall become due and payable on such prepayment
date. The Company shall, on or before the day on which it gives written notice
of any prepayment pursuant to paragraph 4C, give telephonic notice of the
principal amount of the Notes to be prepaid and the prepayment date to each
Significant Holder which shall have designated a recipient for such notices in
the Purchaser Schedule attached hereto or the applicable Confirmation of
Acceptance or by notice in writing to the Company.
4E. APPLICATION OF PREPAYMENTS. In the case of each prepayment of less
than the entire unpaid principal amount of all outstanding Notes of any Series
pursuant to paragraphs 4A, 4B or 4C, the amount to be prepaid shall be applied
pro rata to all outstanding Notes of such Series (including, for the purpose of
this paragraph 4E only, all Notes prepaid or otherwise retired or purchased or
otherwise acquired by the Company or any of its Subsidiaries or Affiliates other
than by prepayment pursuant to paragraph 4A, 4B or 4C) according to the
respective unpaid principal amounts thereof.
4F. RETIREMENT OF NOTES. The Company shall not, and shall not permit
any of its Subsidiaries or Affiliates to, prepay or otherwise retire in whole or
in part prior to their stated final maturity (other than by prepayment pursuant
to paragraphs 4A, 4B or 4C or upon acceleration of such final maturity pursuant
to paragraph 7A), or purchase or otherwise acquire, directly or indirectly,
Notes of any Series held by any holder unless the Company or such Subsidiary or
Affiliate shall have offered to prepay or otherwise retire or purchase or
otherwise acquire, as the case may be, the same proportion of the aggregate
principal amount of Notes of such Series held by each other holder of Notes of
such Series at the time outstanding upon the same terms and conditions. Any
Notes so prepaid or otherwise retired or purchased or otherwise acquired by the
Company or any of its Subsidiaries or Affiliates shall not be deemed to be
outstanding for any purpose under this Agreement, except as provided in
paragraph 4E.
5. AFFIRMATIVE COVENANTS. During the Issuance Period and so long
thereafter as any Note is outstanding and unpaid, the Company covenants as
follows:
5A. REPORTING REQUIREMENTS.
5A(1). GENERAL INFORMATION. The Company covenants that it will deliver to
each Significant Holder in triplicate:
12
(i) as soon as practicable and in any event within 45 days after
the end of each quarterly period (other than the fourth quarterly period)
in each fiscal year,
(1) Consolidating and Consolidated statements of income,
stockholders' equity and cash flows for the period from the
beginning of the current fiscal year to the end of such quarterly
period, and
(2) a Consolidating and Consolidated balance sheet as at the
end of such quarterly period,
setting forth in each case in comparative form figures for the
corresponding period in the preceding fiscal year, all in reasonable
detail and satisfactory in form to the Required Holder(s) and certified by
an authorized financial officer of the Company as fairly presenting, in
all material respects, the financial condition of the Company and its
Consolidated Subsidiaries as of the end of such period and the results of
their operations for the period then ended in accordance with generally
accepted accounting principles, subject to changes resulting from normal
year-end adjustments and the inclusion of abbreviated footnotes; provided,
however, that delivery pursuant to clause (iii) below of copies of the
Quarterly Report on Form 10-Q of the Company for such quarterly period
filed with the Securities and Exchange Commission shall be deemed to
satisfy the requirements of this clause (i) with respect to the
Consolidated Statements ;
(ii) as soon as practicable and in any event within 90 days after
the end of each fiscal year,
(1) Consolidating and Consolidated statements of income,
stockholders' equity and cash flows for such year, and
(2) a Consolidating and Consolidated balance sheet as at the
end of such year,
setting forth in each case in comparative form corresponding Consolidated
figures from the preceding annual audit, all in reasonable detail and
satisfactory in scope to the Required Holder(s) and reported on by
independent public accountants of recognized standing selected by the
Company whose report shall be without limitation as to the scope of the
audit and reasonably satisfactory in substance to the Required Holder(s);
provided, however, that delivery pursuant to clause (iii) below of copies
of the Annual
13
Report on Form 10-K of the Company for such year filed with the Securities
and Exchange Commission shall be deemed to satisfy the requirements of
this clause (ii) with respect to the Consolidated statements;
(iii) if the Company or any of its Restricted Subsidiaries shall
become a public company, promptly upon transmission thereof, copies of all
such financial statements, proxy statements, notices and reports as it
shall send to its public stockholders and copies of all registration
statements (without exhibits) and all reports (other than any registration
statement filed on Form S-8) which it files with the Securities and
Exchange Commission (or any governmental body or agency succeeding to the
functions of the Securities and Exchange Commission);
(iv) promptly upon receipt thereof, a copy of each other report
(including, without limitation, management letters) submitted to the
Company or any Subsidiary by independent accountants in connection with
any annual, interim or special audit made by them of the books of the
Company or any Subsidiary;
(v) promptly upon receipt thereof, a copy of each report, survey,
study, evaluation or assessment or, promptly upon request therefor, any
other document prepared by any consultant, engineer, environmental
authority or other Person (other than work product of the Company's legal
counsel) relating to compliance by the Company or any Subsidiary with any
Environmental Laws, if the cost of remediation, repair or compliance may
be reasonably expected to exceed $1,000,000 in any one case or in the
aggregate;
(vi) with reasonable promptness, upon the request of the holder of
any Note, provide such holder, and any qualified institutional buyer
designated by such holder, such financial and other information as such
holder may reasonably determine to be necessary in order to permit
compliance with the information requirements of Rule 144A under the
Securities Act in connection with the resale of Notes, except at such
times as the Company is subject to the reporting requirements of section
13 or 15(d) of the Exchange Act. For the purpose of this clause (vii), the
term "qualified institutional buyer" shall have the meaning specified in
Rule 144A under the Securities Act; and
(vii) with reasonable promptness, such other financial data as a
Significant Holder may reasonably request;
14
5A(2). QUARTERLY OFFICER'S CERTIFICATES. Together with each delivery of
financial statements required by clauses 5A(i) and (ii) above, the Company will
deliver to each Significant Holder an Officer's Certificate demonstrating (with
computations in reasonable detail) compliance with the provisions of paragraphs
6A, 6B, 6C, 6D, 6E and 6G and stating that there exists no Event of Default or
Default, or, if any Event of Default or Default exists, specifying the nature
and period of existence thereof and what action the Company has taken, is taking
or proposes to take with respect thereto;
5A(3). ANNUAL ACCOUNTANT'S LETTER. Together with each delivery of
financial statements required by clause 5A(ii) above, the Company will deliver
to each Significant Holder a certificate of the independent public accountants
giving the report on such financial statements stating that, in making the audit
necessary for their report, they have obtained no knowledge of any Event of
Default or Default, or, if they have obtained knowledge of any Event of Default
or Default, specifying the nature and period of existence thereof. The
accountants, however, shall not be liable to anyone as a result of this
provision by reason of their failure to obtain knowledge of any Event of Default
or Default which would not be disclosed in the course of an audit conducted in
accordance with generally accepted auditing standards;
5A(4). SPECIAL INFORMATION. The Company also covenants that as soon as
practicable but in no event later than five Business Days after any Responsible
Officer obtains knowledge of:
(a) an Event of Default or Default;
(b) a material adverse change in the financial condition,
business or operations of the Company and its Subsidiaries, taken as a
whole;
(c) legal proceedings filed against the Company and/or any
Subsidiary, which reasonably could be expected to have a Material Adverse
Effect, or which in any manner draws into question the validity of or
reasonably could be expected to impair the ability of the Company to
perform its obligations under this Agreement or the Notes;
(d) the occurrence of any other event that reasonably could be
expected to impair the ability of the Company to meet its obligations
hereunder;
(e) any (i) Environmental Liabilities, (ii) pending, threatened
or anticipated Environmental Proceedings, (iii) Environmental Notices,
15
(iv) Environmental Judgments and Orders, or (v) Environmental Releases at,
on, in, under or in any way affecting the Properties which reasonably
could be expected to have a Material Adverse Effect; or
(f) with respect to any Plan that is subject to the funding
requirements of Section 302 of ERISA or Section 412 of the Code, the
Company (i) has given or is required to give notice to the Pension Benefit
Guaranty Corporation that a material reportable event has occurred with
respect to such Plan, (ii) has delivered notice to the Pension Benefit
Guaranty Corporation of any intent to withdraw from or terminate any such
Plan, or (iii) has failed to make timely a contribution to any such Plan;
the Company will deliver to each Significant Holder an Officer's Certificate
specifying the nature and period of existence thereof and what action the
Company or the Subsidiary has taken, is taking or proposes to take with respect
thereto.
5B. INSPECTION OF PROPERTY. The Company covenants that it will permit
any Person designated by any Significant Holder in writing, at such Significant
Holder's expense, to:
(i) visit and inspect any of the properties of the Company and
its Subsidiaries,
(ii) examine the corporate books and financial records of the
Company and its Subsidiaries and make copies thereof or extracts
therefrom;
(iii) discuss the affairs, finances and accounts of any of such
corporations with the principal officers of the Company and its
independent public accountants,
all at such reasonable times and as often as such Significant Holder may
reasonably request.
5C. COVENANT TO SECURE NOTES EQUALLY. The Company covenants that, if
it or any Subsidiary shall create or assume any Lien upon any of its property or
assets, whether now owned or hereafter acquired, other than Liens permitted by
the provisions of paragraph 6C (unless prior written consent to the creation or
assumption thereof shall have been obtained pursuant to paragraph 11C), it will
make or cause to be made effective provision whereby the Notes will be secured
by such Lien equally and ratably with any and all other Debt thereby secured so
long as any such other Debt shall be so secured.
16
5D. GUARANTEED OBLIGATIONS. The Company covenants that if any Person
(other than the Company) guarantees or provides collateral in any manner for any
Debt of the Company or any Subsidiary, it will simultaneously cause such Person
to guarantee or provide collateral for the Notes equally and ratably with all
Debt guaranteed or secured by such Person pursuant to documentation in form and
substance reasonably satisfactory to such holder.
5E. MAINTENANCE OF INSURANCE. The Company covenants that it and each
Subsidiary will maintain, with responsible insurers, insurance with respect to
its properties and business against such casualties and contingencies
(including, but not limited to, public liability, larceny, embezzlement or other
criminal misappropriation) and in such amounts as is customary in the case of
similarly situated corporations engaged in the same or similar businesses.
5F. MAINTENANCE OF CORPORATE EXISTENCE/COMPLIANCE WITH LAW/PRESERVATION OF
PROPERTY. The Company covenants that, except as permitted under paragraph 6F,
it and each Subsidiary will do or cause to be done all things necessary to:
(i) preserve, renew and keep in full force and effect the
corporate existence of the Company and its Subsidiaries (other than those
Subsidiaries not material to the financial condition, business or
operations of the Company and its Subsidiaries taken as a whole);
(ii) comply with all laws and regulations (including, without
limitation, laws and regulations relating to equal employment opportunity
and employee safety) applicable to it and any Subsidiary except where the
failure to comply could not reasonably be expected to have a Material
Adverse Effect on the business, operations or financial condition of the
Company and its Subsidiaries, taken as a whole;
(iii) maintain, preserve and protect all material intellectual
property of the Company and its Subsidiaries; and
(iv) preserve all the remainder of its property used or useful in
the conduct of its business and keep the same in good repair, working order
and condition excluding normal wear and tear.
5G. COMPLIANCE WITH ENVIRONMENTAL LAWS. The Company covenants that it and
each Subsidiary will, comply in a timely fashion with, or operate pursuant to
valid waivers of the provisions of, all applicable Environmental Laws,
including,
17
without limitation, the emission of wastewater effluent, solid and hazardous
waste and air emissions together with any other applicable Environmental Laws
for conducting, on a timely basis, periodic tests and monitoring for
contamination of ground water, surface water, air and land and for biological
toxicity of the aforesaid, and all applicable regulations of the Environmental
Protection Agency or other relevant federal, state or local governmental
authority, except where the failure to comply could not reasonably be expected
to have a Material Adverse Effect. The Company agrees to indemnify and hold you,
your officers, agents and employees (each an "INDEMNIFIED PERSON") harmless from
any loss, liability, claim or expense that you may incur or suffer as a result
of a breach by the Company or any Subsidiary, as the case may be, of this
covenant other than as a result of the gross negligence or wilful misconduct of
such Indemnified Person. The Company shall not be deemed to have breached or
violated this paragraph 5G if the Company or any Subsidiary is challenging in
good faith by appropriate proceedings diligently pursued the application or
enforcement of such Environmental Laws for which adequate reserves have been
established in accordance with generally accepted accounting principles.
5H. NO INTEGRATION. The Company covenants that it has taken and will take
all necessary action so that the issuance of the Notes does not and will not
require registration under the Securities Act. The Company covenants that no
future offer and sale of debt securities of the Company of any class will be
made if there is a reasonable possibility that such offer and sale would, under
the doctrine of "integration", subject the issuance of the Notes to you to the
registration requirements of the Securities Act.
6. NEGATIVE COVENANTS. During the Issuance Period and so long thereafter
as any Note or other amount due hereunder is outstanding and unpaid, the Company
covenants as follows:
6A. FINANCIAL COVENANTS.
(i) CONSOLIDATED FUNDED DEBT TO LEVERAGE RATIO. The Company shall
not permit the ratio of Consolidated Funded Debt to Total Capital to exceed
0.50 to 1.0, calculated on a quarterly basis.
(ii) SENIOR DEBT. The Company shall not permit Consolidated Senior
Funded Debt to exceed an amount equal to 40% of Total Capital, calculated
on a quarterly basis.
(iii) FIXED CHARGE COVERAGE RATIO. The Company shall not permit the
ratio of (a) EBIT plus Consolidated Lease Expense to (b) Consolidated
18
Interest Expense plus Consolidated Lease Expense to be less than 1.50 to
1.0, calculated quarterly for the fiscal quarter then ending and the
preceding seven fiscal quarters.
(iv) CURRENT RATIO. The Company shall not permit the ratio of
Consolidated Current Assets to Consolidated Current Liabilities to be less
than 1.25 to 1.0, calculated on a quarterly basis.
In the event that the Company acquires or otherwise obtains the remaining
outstanding common stock of Golden Poultry, the financial covenants set forth in
this paragraph 6A will be calculated beginning on the last day of the first
fiscal quarter following such purchase, on a consolidated basis in accordance
with GAAP.
6B. LIMITATION ON RESTRICTED PAYMENTS. The Company covenants that it will
not (i) pay or declare any dividend or make any other distribution on or on
account of any class of its stock or other equity or make cash distributions of
equity (including cash patronage refunds), or (ii) make interest payments on
equity, or redeem, purchase or otherwise acquire, directly or indirectly, any
shares of its stock or other equity, or (iii) redeem, purchase or otherwise
acquire, directly or indirectly, any Subordinated Debt, including, but not
limited to, its Subordinated Capital Certificates of Interest, Subordinated Loan
Certificates and Cumulative Preferred Certificates of Interest (except required
redemptions as provided in the indentures pursuant to which such Subordinated
Debt was issued), or make any loans, advances or investments in Golden Poultry
or permitted under clause (xvii) of paragraph 6D of this Agreement or permit any
Restricted Subsidiary to do any of the above (all of the foregoing being herein
called "RESTRICTED PAYMENTS") except out of Consolidated Net Earnings Available
for Restricted Payments; provided that the Company shall not make any Restricted
Payments upon the occurrence and during the continuance of a Default or Event of
Default. So long as there is no Default or Event of Default occurring or
continuing, there shall not be included in the definition of Restricted
Payments: (x) dividends paid, or distributions made, in stock of the Company or
(y) exchanges of stock of one or more classes of the Company, except to the
extent that cash or other value is involved in such exchange. The term "equity"
as used in this paragraph 6B shall include the Company's common stock, preferred
stock, if any, other equity certificates, and notified equity accounts of
patrons.
6C. LIENS. The Company covenants that it will not, nor will it permit any
Restricted Subsidiary to, create, assume or suffer to exist any Lien upon any of
its property or assets whether now owned or hereafter acquired, except:
19
(i) Liens existing prior to the date of this Agreement, as set
forth on Schedule 6C attached hereto;
(ii) Liens for taxes not yet due, and Liens for taxes or Liens
imposed by ERISA which are being contested in good faith by appropriate
proceedings and with respect to which adequate reserves are being
maintained;
(iii) statutory Liens of landlords and Liens of carriers,
warehousemen, mechanics, materialmen and other Liens imposed by law created
in the ordinary course of business for amounts not yet due or which are
being contested in good faith by appropriate proceedings and with respect
to which adequate reserves are being maintained;
(iv) Liens incurred or deposits made in the ordinary course of
business in connection with workers' compensation, unemployment insurance
and other types of social security, or to secure the performance of
tenders, statutory obligations, surety and appeal bonds, bids, leases,
government contracts, performance and return-of-money bonds and other
similar obligations (exclusive of obligations for the payment of borrowed
money);
(v) Any Liens that constitute margin accounts set-off arrangements
made in connection with bona fide hedging transactions, as defined in
accordance with GAAP, in commodity futures entered into the ordinary course
of business and not for speculative purposes; and
(vi) Liens securing purchase money debt, provided the aggregate of
such debt so secured does not exceed fifteen percent (15%) of Consolidated
Net Worth.
6D. RESTRICTIONS ON LOANS, ADVANCES, INVESTMENTS AND CONTINGENT
LIABILITIES. The Company covenants that it will not, nor will it permit any
Restricted Subsidiary to, make or permit to remain outstanding any loan or
advance to, or extend credit other than credit extended in the normal course of
business to any Person which is not an Affiliate of the Company, or guarantee,
endorse or otherwise be or become contingently liable, directly or indirectly,
in connection with the obligations, stock or dividends of, or own, purchase or
acquire any stock, obligations or securities of, or any other interest in, or
make any capital contribution to, any Person, except that the Company or any
Subsidiary may:
20
(i) make or permit to remain outstanding loans, advances,
indemnities, or Guarantees to any Subsidiary;
(ii) acquire and own stock, obligations or securities received in
settlement of debts (created in the ordinary course of business) owing to
the Company or any Subsidiary;
(iii) own, purchase or acquire prime commercial paper and
certificates of deposit in United States commercial banks (whose long-term
debt is rated "A" or better by ▇▇▇▇▇'▇ Investors Service or Standard and
Poor's Corporation), in each case due within one year from the date of
purchase and payable in the United States in Dollars;
(iv) own, purchase and acquire obligations of the United States
Government or any agency thereof;
(v) own, purchase and acquire obligations guaranteed by the United
States Government;
(vi) own, purchase and acquire repurchase agreements of United
States commercial banks (whose long-term debt is rated "A" or better by
▇▇▇▇▇'▇ Investors Service or Standard and Poor's Corporation) for terms of
less than one year in respect of the foregoing certificates and
obligations;
(vii) own, purchase and acquire tax-exempt securities maturing
within one year from the date of purchase and rated "A" or better by
▇▇▇▇▇'▇ Investors Service or Standard and Poor's Corporation;
(viii) own, purchase and acquire adjustable rate preferred stocks
rated "A" or better by ▇▇▇▇▇'▇ Investors Service or Standard and Poor's
Corporation;
(ix) endorse negotiable instruments for collection in the ordinary
course of business;
(x) make or permit to remain outstanding travel and other like
advances to officers and employees in the ordinary course of business;
(xi) make or permit to remain outstanding investments as a general
partner in Golden Peanut in amount not to exceed $27,500,000;
21
(xii) make or permit to remain outstanding equity investments in
Golden Poultry in an amount not to exceed $24,900,000;
(xiii) make or permit to remain outstanding equity investments in an
amount not to exceed $26,950,000 in and to Carolina Golden and/or
AgriGolden;
(xiv) make or permit to remain outstanding loans made by GK Finance
to parties other than the Company or a Subsidiary in an amount not to
exceed $25,000,000 at any one time;
(xv) make or permit to remain outstanding investments in the
▇▇▇▇▇▇-▇▇▇▇▇▇▇ Midland Company existing on the date hereof plus increases
due to normal dividend reinvestment plans, stock splits, stock dividends or
similar arrangements;
(xvi) make or permit to remain outstanding investments described on
Schedule 6D attached hereto;
(xvii) make additional loans or advances to, or guarantee, endorse or
otherwise be or become contingently liable in connection with the
obligations, stock, or dividends of, or own, purchase or acquire stock,
obligations or securities of, any other Person, provided that the aggregate
principal amount of such additional loans and advances, plus the aggregate
amount of such additional contingent liabilities plus the aggregate amount
of the additional investment (at original cost) in such stock, obligations
and securities be limited to amounts available out of Consolidated Net
Earnings Available for Restricted Payments, and further provided that no
Subsidiary shall make any loans or advances to, or acquire any stock,
obligations or securities of, the Company, except as provided in clause
(xiv) above;
(xviii) make or permit to remain outstanding investments in GC
Properties; and
(xix) Guarantee or otherwise be or become liable for obligations of
Young Pecan not to exceed an aggregate amount of $65,000,000.
6E. SALE OF STOCK AND DEBT OF SUBSIDIARIES. The Company covenants that
it will not, nor will it permit any Restricted Subsidiary to, sell or otherwise
dispose of, or part with control of, any shares of stock or Indebtedness of any
Restricted Subsidiary, except to the Company or another Restricted Subsidiary,
and
22
except that all shares of stock and Indebtedness of any Restricted Subsidiary at
the time owned by or owed to the Company and all Restricted Subsidiaries may be
sold as an entirety for a cash consideration which represents the fair value (as
determined in good faith by the Board of Directors of the Company) at the time
of sale of the shares of stock and Indebtedness so sold, provided that the
assets of such Restricted Subsidiary do not constitute a substantial part of the
consolidated assets of the Company and all Restricted Subsidiaries and that the
earnings of such Restricted Subsidiary shall not have constituted a substantial
part of Consolidated Net Earnings for any of the three fiscal years then most
recently ended, and further provided that, at the time of such sale, such
Restricted Subsidiary shall not own, directly or indirectly, any shares of stock
or Indebtedness of any other Subsidiary (unless all of the shares of stock and
Indebtedness of such other Subsidiary owned, directly or indirectly, by the
Company and all Subsidiaries are simultaneously being sold as permitted by this
paragraph 6E).
As used in paragraphs 6E, 6F and 7A(xii), a "substantial part of" the
consolidated assets of the Company and all Subsidiaries shall mean assets which,
as a whole, (x) constitute more than 10% of Consolidated Total Assets or (y)
contributed more than 15% of Consolidated Net Earnings for any one or more of
the three prior fiscal years of the Company.
6F. MERGER AND SALE OF ASSETS. The Company covenants that it will not,
nor will it permit any Restricted Subsidiary to, enter into any transaction of
merger, consolidation, pooling of interests, joint venture, syndicate or other
combination with any other Person except for Golden Peanut and Young Pecan or
sell, lease, transfer, contribute as capital, or otherwise dispose of all or a
substantial part of the consolidated assets of the Company and all Subsidiaries
or assets which shall have contributed a substantial part of Consolidated Net
Earnings for any of the three fiscal years then most recently ended, in any
single transaction or series of related transactions, to any Person, except
that:
(i) any Subsidiary may merge with the Company, provided that the
Company shall be the continuing or surviving corporation, or with any one
or more other Restricted Subsidiaries;
(ii) any Subsidiary may sell, lease or otherwise dispose of any of
its assets to the Company or another Restricted Subsidiary;
(iii) the Company or any Restricted Subsidiary may enter into any
transaction of pooling of interests, joint venture, syndicate or other
23
combination with any other Person so long as the aggregate investment of
the Company and/or its Restricted Subsidiaries does not exceed $5,000,000;
and
(iv) any Subsidiary may sell or otherwise dispose of all or
substantially all of its assets subject to the conditions specified in
paragraph 6E with respect to a sale of the stock of such Subsidiary.
6G. SALE AND LEASE-BACK. The Company covenants that it will not, nor will
it permit any Restricted Subsidiary to, enter into any arrangement, with any
Person or under which such other Person is a party, providing for the leasing by
the Company or any Restricted Subsidiary of real or personal property, used by
the Company or any Restricted Subsidiary in the operations of the Company or any
Restricted Subsidiary, which has been or is sold or transferred by the Company
or any Restricted Subsidiary to any other Person to whom funds have been or are
to be advanced by such other Person on the security of such rental obligations
of the Company or such Restricted Subsidiary except to the extent that the total
amount of such arrangements involve, at any one time, assets or property which
constitute an amount equal to or less than ten percent (10%) of Consolidated
Total Assets.
6H. SALE OR DISCOUNT OF RECEIVABLES. The Company covenants that it will
not, nor will it permit any Restricted Subsidiary to, sell with recourse or
discount or otherwise sell for less than the face value thereof, any of its
notes or accounts receivable except for the sale of accounts receivable which
sales shall not exceed $35,000,000 at any one time outstanding.
6I. COMMODITY CONTRACTS. The Company covenants that it will not, nor will
it permit any Subsidiary to, purchase or sell commodity futures contracts except
in bona fide hedging transactions in commodities that represent production
inputs or products to be marketed, or in commodities needed in operations to
meet manufacturing or market demands.
6J. ISSUANCE OF STOCK BY RESTRICTED SUBSIDIARIES. The Company covenants
that it will not permit any Restricted Subsidiary (either directly or indirectly
by the issuance of rights or options for, or securities convertible into, such
shares) to issue, sell or dispose of any shares of its stock of any class (other
than directors' qualifying shares, if any) except to the Company or another
Subsidiary.
24
7. EVENTS OF DEFAULT.
7A. ACCELERATION. If any of the following events shall occur and be
continuing for any reason whatsoever (and whether such occurrence shall be
voluntary or involuntary or come about or be effected by operation of law or
otherwise):
(i) the Company defaults in the payment of any principal of, or
Yield-Maintenance Amount payable with respect to, any Note when the same
shall become due, either by the terms thereof or otherwise as herein
provided; or
(ii) the Company defaults in the payment of any interest on any Note
for more than 10 days after the date due; or
(iii) the Company or any Subsidiary defaults (whether as primary
obligor or as guarantor or other surety) in any payment of principal of or
interest on any other obligation for money borrowed (or any Capitalized
Lease Obligation, any obligation under a conditional sale or other title
retention agreement, any obligation issued or assumed as full or partial
payment for property whether or not secured by a purchase money mortgage
or any obligation under notes payable or drafts accepted representing
extensions of credit) beyond any period of grace provided with respect
thereto, or the Company or any Subsidiary fails to perform or observe any
other agreement, term or condition contained in any agreement under which
any such obligation is created (or if any other event thereunder or under
any such agreement shall occur and be continuing) and the effect of such
failure or other event is to cause, or to permit the holder or holders of
such obligation (or a trustee on behalf of such holder or holders) to
cause, such obligation to become due (or to be repurchased by the Company
or any Subsidiary) prior to any stated maturity; or
(iv) any representation or warranty made by the Company herein or by
the Company or any of its officers in any writing furnished in connection
with or pursuant to this Agreement shall be false in any material respect
on the date as of which made; or
(v) the Company fails to perform or observe any agreement contained
in paragraph 6; or
25
(vi) the Company fails to perform or observe any other agreement,
term or condition contained herein and such failure shall not be remedied
within 20 days after any Responsible Officer obtains actual knowledge
thereof; or
(vii) the Company or any Subsidiary makes an assignment for the
benefit of creditors or is generally not paying its debts as such debts
become due; or
(viii) any decree or order for relief in respect of the Company or
any Subsidiary is entered under any bankruptcy, reorganization, compromise,
arrangement, insolvency, readjustment of debt, dissolution or liquidation
or similar law, whether now or hereafter in effect (herein called the
"BANKRUPTCY LAW"), of any jurisdiction; or
(ix) the Company or any Subsidiary petitions or applies to any
tribunal for, or consents to, the appointment of, or taking possession by,
a trustee, receiver, custodian, liquidator or similar official of the
Company or any Subsidiary, or of any substantial part of the assets of the
Company or any Subsidiary, or commences a voluntary case under the
Bankruptcy Law of the United States or any proceedings (other than
proceedings for the voluntary liquidation and dissolution of a Subsidiary)
relating to the Company or any Subsidiary under the Bankruptcy Law of any
other jurisdiction; or
(x) any such petition or application is filed, or any such
proceedings are commenced, against the Company or any Subsidiary and the
Company or such Subsidiary by any act indicates its approval thereof,
consent thereto or acquiescence therein, or an order, judgment or decree is
entered appointing any such trustee, receiver, custodian, liquidator or
similar official, or approving the petition in any such proceedings, and
such order, judgment or decree remains unstayed and in effect for more than
30 days; or
(xi) any order, judgment or decree is entered in any proceedings
against the Company decreeing the dissolution of the Company and such
order, judgment or decree remains unstayed and in effect for more than 60
days: or
(xii) any order, judgment or decree is entered in any proceedings
against the Company or any Subsidiary decreeing a split-up of the Company
or such Subsidiary which requires the divestiture of assets representing a
substantial part, or the divestiture of the stock of a Subsidiary whose
assets
26
represent a substantial part, of the consolidated assets of the Company and
its Subsidiaries (determined in accordance with generally accepted
accounting principles) or which requires the divestiture of assets, or
stock of a Subsidiary, which shall have contributed a substantial part of
the consolidated net income of the Company and its Subsidiaries (determined
in accordance with generally accepted accounting principles) for any of the
three fiscal years then most recently ended, and such order, judgment or
decree remains unstayed and in effect for more than 60 days; or
(xiii) one or more final judgments in an aggregate amount in excess
of $1,000,000 is rendered against the Company or any Subsidiary and, within
60 days after entry thereof, any such judgment is not discharged or
execution thereof stayed pending appeal, or within 60 days after the
expiration of any such stay, such judgment is not discharged; or
(xiv) the Company or any ERISA Affiliate, in its capacity as an
employer under a Multiemployer Plan, makes a complete or partial withdrawal
from such Multiemployer Plan resulting in the incurrence by such
withdrawing employer of a withdrawal liability in an amount exceeding
$1,000,000;
then:
(a) if such event is an Event of Default specified in clause (i) or
(ii) of this paragraph 7A, any holder of any Note may at its option during
the continuance of such Event of Default, by notice in writing to the
Company, terminate the Facility and/or declare all of the Notes held by
such holder to be, and all of the Notes held by such holder shall thereupon
be and become, immediately due and payable at par together with interest
accrued thereon, without presentment, demand, protest or notice of any
kind, all of which are hereby waived by the Company,
(b) if such event is an Event of Default specified in clause
(viii), (ix) or (x) of this paragraph 7A with respect to the Company, the
Facility shall automatically terminate and all of the Notes at the time
outstanding shall automatically become immediately due and payable together
with interest accrued thereon and together with the Yield-Maintenance
Amount, if any, with respect to each Note, without presentment, demand,
protest or notice of any kind, all of which are hereby waived by the
Company, and
(c) with respect to any event constituting an Event of Default, the
Required Holder(s) of the Notes of any Series may at its or their option
during
27
the continuance of such Event of Default, by notice in writing to the
Company, terminate the Facility and declare all of the Notes of such Series
to be, and all of the Notes of such Series shall thereupon be and become,
immediately due and payable together with interest accrued thereon and
together with the Yield-Maintenance Amount, if any, with respect to each
Note of such Series, without presentment, demand, protest or notice of any
kind, all of which are hereby waived by the Company.
7B. RESCISSION OF ACCELERATION. At any time after any or all of the Notes
of any Series shall have been declared immediately due and payable pursuant to
paragraph 7A, the Required Holder(s) of the Notes of such Series may, by notice
in writing to the Company, rescind and annul such declaration and its
consequences if (i) the Company shall have paid all overdue interest on the
Notes of such Series, the principal of and Yield-Maintenance Amount, if any,
payable with respect to any Notes of such Series which have become due otherwise
than by reason of such declaration, and interest on such overdue interest and
overdue principal and Yield-Maintenance Amount at the rate specified in the
Notes of such Series, (ii) the Company shall not have paid any amounts which
have become due solely by reason of such declaration, (iii) all Events of
Default and Defaults, other than non-payment of amounts which have become due
solely by reason of such declaration, shall have been cured or waived pursuant
to paragraph 11C, and (iv) no judgment or decree shall have been entered for the
payment of any amounts due pursuant to the Notes of such Series or this
Agreement. No such rescission or annulment shall extend to or affect any
subsequent Event of Default or Default or impair any right arising therefrom.
7C. NOTICE OF ACCELERATION OR RESCISSION. Whenever any Note shall be
declared immediately due and payable pursuant to paragraph 7A or any such
declaration shall be rescinded and annulled pursuant to paragraph 7B, the
Company shall forthwith give written notice thereof to the holder of each Note
of each Series at the time outstanding.
7D. OTHER REMEDIES. If any Event of Default or Default shall occur and be
continuing, the holder of any Note may proceed to protect and enforce its rights
under this Agreement and such Note by exercising such remedies as are available
to such holder in respect thereof under applicable law, either by suit in equity
or by action at law, or both, whether for specific performance of any covenant
or other agreement contained in this Agreement or in aid of the exercise of any
power granted in this Agreement. No remedy conferred in this Agreement upon the
holder of any Note is intended to be exclusive of any other remedy, and each and
every such remedy shall be cumulative and shall be in addition to every other
remedy conferred herein or now or hereafter existing at law or in equity or by
statute or otherwise.
28
8. REPRESENTATIONS, COVENANTS AND WARRANTIES. The Company represents,
covenants and warrants as follows:
8A. ORGANIZATION AND QUALIFICATION. The company is an agricultural
membership cooperative duly incorporated and existing in good standing under the
Cooperating Marketing Act of the State of Georgia, each Subsidiary is duly
incorporated and existing in good standing under the law of the jurisdiction in
which it is incorporated, the Company and each Subsidiary has the corporate
power to own its respective property and to carry on its respective business as
now being conducted, and the Company and each Subsidiary is duly qualified as a
foreign corporation to do business and in good standing in every jurisdiction in
which the nature of the respective business conducted by property owned by it
legally requires such qualification except to the extent failure to so qualify
does not result in a Material Adverse Effect.
8B. FINANCIAL STATEMENTS. The Company has furnished you with the
following financial statements, identified by a principal financial officer of
the Company: consolidated balance sheets of the Company and its Subsidiaries as
at June 30, in the years of 1991 through 1996, and consolidated statements of
income and statements of changes in financial position of the Company and its
Subsidiaries for such years, all certified by KPMB Peat Marwick. Such financial
statements (including any related schedules and/or notes) are true and correct
in all material respects (subject, as to interim statements, to changes
resulting from audits and year-end adjustments), have been prepared in
accordance with generally accepted accounting principles consistently followed
throughout the periods involved and show all liabilities, direct and contingent,
of the Company and its Subsidiaries required to be shown in accordance with such
principles. The balance sheets fairly present the condition of the Company and
its Subsidiaries as at the dates thereof, and the statements of income and
statements of changes in financial position fairly present the results of the
operations of the Company and its Subsidiaries for the periods indicated. There
has been no material change in the business, condition or operations (financial
or otherwise) of the Company and its Subsidiaries taken as a whole since June
30, 1996.
8C. ACTIONS PENDING. There is no action, suit, investigation or
proceeding pending or, to the knowledge of the Company, threatened against the
Company or any of its Subsidiaries, or any properties or rights of the Company
or any of its Subsidiaries, by or before any court, arbitrator or administrative
or governmental body which might result in any material adverse change in the
business, condition or operations of the Company and its Subsidiaries as a
whole.
29
8D. OUTSTANDING DEBT. Neither the Company nor any of its Restricted
Subsidiaries has outstanding any Debt, on a consolidated basis except as
permitted by paragraph 6A. There exists no default under the provisions of any
instrument evidencing such Debt or of any agreement relating thereto.
8E. TITLE TO PROPERTIES. The Company has and each of its Restricted
Subsidiaries has good and marketable title to its respective real properties
(other than properties which it leases) and good title to all of its other
properties or assets, including the properties and assets reflected in the
balance sheet as at June 30, 1996 hereinabove described (other than properties
and assets disposed of in the ordinary course of business), subject to no Lien
of any kind except Liens permitted by paragraph 6C. The Company and its
Restricted Subsidiaries enjoy peaceful and undisturbed possession under all
leases necessary in any material respect for the operation of their respective
properties and assets, none of which contains any unusual or burdensome
provisions which might materially affect or impair the operation of such
properties or assets. All such leases are valid and subsisting and are in full
force and effect.
8F. TAXES. The Company has and each of its Subsidiaries has filed all
Federal, State and other income tax returns, which, to the best knowledge of the
officers of the Company, are required to be filed, and each has paid all taxes
as shown on said returns and on all assessments received by it to the extent
that such taxes have become due or except such as are being contested in good
faith by appropriate proceedings for which adequate reserves have been
established in accordance with generally accepted accounting principles.
Federal, State and other income tax returns of the Company and its Subsidiaries
have been examined and reported on by the taxing authorities or closed by
applicable statutes and satisfied for all fiscal years prior to and including
the fiscal year ended on June 30, 1986.
8G. CONFLICTING AGREEMENTS OR OTHER MATTERS. Neither the Company nor any
of its Subsidiaries is a party to any contract or agreement or subject to any
charter or other corporate restriction which materially and adversely affects
its business, property or assets, or financial condition. Neither the execution
nor delivery of this Agreement nor of the Notes, nor the offering, issuance and
sale of the Notes, nor fulfillment of nor compliance with the terms and
provisions hereof and of the Notes will conflict with, or result in a breach of
the terms, conditions or provisions of, or constitute a default under, or result
in any violation of, or result in the creation of any Lien upon any of the
properties or assets of the Company or any of its Subsidiaries pursuant to, the
charter or by-laws of the Company or any of its Subsidiaries, any award of any
arbitrator or any agreement (including any agreement with stockholders),
instrument, order, judgment, decree, statute, law, rule or regulation to
30
which the Company or any of its Subsidiaries is subject. Neither the Company nor
any of its Subsidiaries is a party to, or otherwise subject to any provision
contained in, any instrument evidencing Indebtedness of the Company or such
Subsidiary, any agreement relating thereto or any other contract or agreement
(including its charter) which limits the amount of, or otherwise imposes
restrictions on the incurring of, Debt of the Company of the type to be
evidenced by the Notes except as set forth in the agreements listed in Schedule
8G attached hereto.
8H. OFFERING OF NOTES. Neither the Company nor any agent acting on its
behalf has, directly or indirectly, offered the Notes or any similar security of
the Company for sale to, or solicited any offers to buy the Notes or any similar
security of the Company from, or otherwise approached or negotiated with respect
thereto with, any Person other than you, and neither the Company nor any agent
acting on its behalf has taken or will take any action which would subject the
issuance or sale of the Notes to the provisions of Section 5 of the Securities
Act of 1933, as amended, or to the provisions of any securities or Blue Sky law
of any applicable jurisdiction. The Company hereby represents and warrants to
you that, within the preceding twelve months, neither the Company nor any Person
acting on behalf of the Company has offered or sold to any Person, any Notes, or
any securities of the same or similar class as the Notes, or any other
substantially similar securities of the Company.
8I. USE OF PROCEEDS/REGULATION G, ETC. The proceeds of the Series A Notes
will be used for general working capital purposes. Neither the Company nor any
agent acting on its behalf has taken or will take any action which might cause
this Agreement or the Notes to violate Regulation G, T, U or X or (to our best
knowledge) any other regulation of the Board of Governors of the Federal Reserve
System, or to violate the Securities Exchange Act of 1934, as amended, in each
case as in effect now or as the same may hereafter be in effect.
8J. ERISA. No accumulated funding deficiency (as defined in section 302,
of ERISA and section 412 of the Code), whether or not waived, exists with
respect to any Plan (other than a Multiemployer Plan). No liability to the
Pension Benefit Guaranty Corporation has been or is expected by the Company to
be incurred with respect to any Plan (other than a Multiemployer Plan) by the
Company or any of its Subsidiaries which is or would be materially adverse to
the Company and its Subsidiaries taken as a whole. Neither the Company nor any
of its Subsidiaries has incurred or presently expects to incur any withdrawal
liability under Title IV of ERISA which respect to any Multiemployer Plan which
is or would be materially adverse to the Company and its Subsidiaries taken as a
whole. The execution and delivery of this Agreement and the issue and sale of
the Notes will not involve any prohibited transaction within the meaning of
ERISA or in connection with which a tax
31
could be imposed pursuant to section 4975 of the Code or a violation of Section
406 or Section 407 of ERISA. The representation by the Company in the next
preceding sentence is made in reliance upon and subject to the accuracy of your
representation in paragraph 9 as to the source of the funds to be used to pay
the purchase price of the Notes to be purchased by you.
8K. FOREIGN ASSETS CONTROL REGULATIONS. Neither the borrowing by the
Company hereunder nor its use of the proceeds thereof will violate the Foreign
Assets Control Regulations, the Cuban Assets Control Regulations or the Iranian
Assets Control Regulations of the United States Treasury Department (31 CFR,
Subtitle B, Chapter V).
8L. GOVERNMENTAL CONSENT. Neither the nature of the Company or of any
Subsidiary, nor any of their respective businesses or properties, nor any
relationship between the Company or any Subsidiary and any other Person, nor any
circumstance in connection with the offer, issue, sale or delivery of the Notes
is such as to require any authorization, consent, approval, exemption or other
action by or notice to or filing with any court or administrative or
governmental body (other than routine filings after the date of closing with the
Securities and Exchange Commission and/or state Blue Sky authorities) in
connection with the execution and delivery of this Agreement, the offer, issue,
sale or delivery of the Notes or fulfillment of or compliance with the terms and
provisions hereof or of the Notes.
8M. POSSESSION OF FRANCHISES, LICENSES, ETC. The Company and its
Subsidiaries possess all franchise, certificates, licenses, permits, and other
authorizations from governmental political subdivisions or regulatory
authorities, and all patents, trademarks, service marks, trade names,
copyrights, licenses and other rights, free from burdensome restrictions, that
are necessary in any material respect for the ownership, maintenance and
operation of their respective properties and assets and neither the Company nor
any Subsidiary is in violation of any thereof in any material respect.
8N. POLLUTION AND OTHER REGULATIONS. The Company and each Subsidiary has
obtained all permits, licenses and other authorizations which are required
under, and is in material compliance with, Federal, State and local laws and
regulations relating to pollution, reclamation, or protection of the
environment, including laws relating to emissions, discharges, releases or
threatened releases or pollutants, contaminants, or hazardous or toxic materials
or wastes into air, water, or land, or otherwise relating to the manufacture,
processing distribution, use, treatment, storage, disposal, transport, or
handling of pollutants, contaminants or hazardous or toxic materials or wastes.
The Company and each Subsidiary is in material compliance with
32
all laws and regulations relating to equal employment opportunity and employee
health and safety, and health and sanitary codes, in all jurisdictions in which
the Company and each Subsidiary is presently doing business. The Company will
and will cause each Subsidiary to be in material compliance with all laws and
regulations which may be legally imposed in the future in jurisdictions in which
the Company and any Subsidiary may then be doing business.
8O. DISCLOSURE. Neither this Agreement nor any other document,
certificate or statement furnished to you by or on behalf of the Company in
connection herewith contains any untrue statement of a material fact or omits to
state a material fact necessary in order to make the statements contained herein
and therein not misleading. There is no fact peculiar to the Company or any of
its Subsidiaries which materially adversely affects or in the future may (so far
as the Company can now foresee) materially adversely affect the business,
property or assets, or financial condition of the Company or any of its
Subsidiaries which has not been set forth in this Agreement or in the other
documents, certificates and statements furnished to you by or on behalf of the
Company contemplated hereby.
8P. HOSTILE TENDER OFFERS. None of the proceeds of the sale of any Notes
will be used to finance a Hostile Tender Offer.
9. REPRESENTATIONS OF THE PURCHASERS.
Each Purchaser represents as follows:
9A. NATURE OF PURCHASE. Such Purchaser is not acquiring the Notes
purchased by it hereunder with a view to or for sale in connection with any
distribution thereof within the meaning of the Securities Act, provided that the
disposition of such Purchaser's property shall at all times be and remain within
its control.
9B. SOURCE OF FUNDS. You represent that at least one of the following
statements is an accurate representation as to each source of funds (a "SOURCE")
to be used by you to pay the purchase price of the Notes to be purchased by you
hereunder:
(i) the Source constitutes assets allocated to your "insurance company
general account" (as such term is defined under Section V of the United
States Department of Labor's Prohibited Transaction Exemption ("PTE") 95-
60), and as of the date of the purchase of the Notes, you satisfy
33
all of the applicable requirements for relief under Sections I and IV of
PTE 95-60; or
(ii) if you are an insurance company, the Source does not include
assets allocated to any separate account maintained by you in which any
employee benefit plan (or its related trust) has any interest, other than
a separate account that is maintained solely in connection with your fixed
contractual obligations under which the amounts payable, or credited, to
such plan and to any participant or beneficiary of such plan (including
any annuitant) are not affected in any manner by the investment
performance of the separate account; or
(iii) the Source is either (a) an insurance company pooled separate
account, within the meaning ▇▇▇ ▇▇-▇ (▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇, ▇▇▇▇), ▇▇ (▇) a
bank collective investment fund, within the meaning of the PTE 91-38
(issued July 12, 1991) and, except as you have disclosed to the Company in
writing pursuant to this paragraph (iii), no employee benefit plan or
group of plans maintained by the same employer or employee organization
beneficially owns more than 10% of all assets allocated to such pooled
separate account or collective investment fund; or
(iv) the Source constitutes asset of an "investment fund" (within
the meaning of Part V of the QPAM Exemption) managed by a "qualified
professional asset manager" or "QPAM" (within the meaning of Part V of the
QPAM Exemption), no employee benefit plan's assets that are included in
such investment fund, when combined with the assets of all other employee
benefit plans established or maintained by the same employer or by an
affiliate (within the meaning of Section V(c)(1) of the QPAM Exemption) of
such employer or by the same employee organization and managed by such
QPAM, exceed 20% of the total client assets managed by such QPAM, the
conditions of Part I(c) and (g) of the QPAM Exemption are satisfied,
neither the QPAM nor a person controlling or controlled by the QPAM
(applying the definition of "control" in Section V(e) of the QPAM
Exemption) owns a 5% or more interest in the company and (a) the identity
of such QPAM and (b) the names of all employee benefit plans whose assets
are included in such investment fund have been disclosed to the Company in
writing pursuant to clause (iii); or
(v) the Source is a governmental plan; or
34
(vi) the Source is one or more employee benefit plans, or a separate
account or trust fund comprised of one or more employee benefit plans,
each of which has been identified to the Company in writing pursuant to
this clause (vi); or
(vii) the Source does not include assets of any employee benefit
plan, other than a plan exempt from the coverage of ERISA.
As used in this paragraph 9B, the terms "EMPLOYEE BENEFIT PLAN", "GOVERNMENTAL
PLAN", "PARTY IN INTEREST" and "SEPARATE ACCOUNT" shall have the respective
meanings assigned to such terms in Section 3 of ERISA.
10. DEFINITIONS; ACCOUNTING MATTERS. For the purpose of this Agreement,
the terms defined in paragraphs 10A and 10B (or within the text of any other
paragraph) shall have the respective meanings specified therein and all
accounting matters shall be subject to determination as provided in paragraph
10C.
10A. YIELD-MAINTENANCE TERMS.
"CALLED PRINCIPAL" shall mean, with respect to any Note, the principal of
such Note that is to be prepaid pursuant to paragraph 4C or is declared to be
immediately due and payable pursuant to paragraph 7A, as the context requires.
"DESIGNATED SPREAD" shall mean .50% of 1% in the case of each Series A
Notes and 0% in the case of each Note of any other Series unless the
Confirmation of Acceptance with respect to the Notes of such Series specifies a
different Designated Spread in which case it shall mean, with respect to each
Note of such Series, the Designated Spread so specified.
"DISCOUNTED VALUE" shall mean, with respect to the Called Principal of any
Note, the amount obtained by discounting all Remaining Scheduled Payments with
respect to such Called Principal from their respective scheduled due dates to
the Settlement Date with respect to such Called Principal, in accordance with
accepted financial practice and at a discount factor (as converted to reflect
the periodic basis on which interest on such Note is payable, if payable other
than on a semi-annual basis) equal to the Reinvestment Yield with respect to
such Called Principal.
"REINVESTMENT YIELD" shall mean, with respect to the Called Principal of
any Note, the Designated Spread over the yield to maturity implied by (i) the
yields reported, as of 10:00 A.M. (New York City local time) on the Business Day
next preceding the Settlement Date with respect to such Called Principal, on the
display
35
designated as "Page 678"on the Telerate Service (or such other display as may
replace page 678 on the Telerate Service) for actively traded U.S. Treasury
securities having a maturity equal to the Remaining Average Life of such Called
Principal as of such Settlement Date, or if such yields shall not be reported as
of such time or the yields reported as of such time shall not be ascertainable,
(ii) the Treasury Constant Maturity Series yields reported, for the latest day
for which such yields shall have been so reported as of the Business Day next
preceding the Settlement Date with respect to such Called Principal, in Federal
Reserve Statistical Release H.15 (519) (or any comparable successor publication)
for actively traded U.S. Treasury securities having a constant maturity equal to
the Remaining Average Life of such Called Principal as of such Settlement Date.
Such implied yield shall be determined, if necessary, by (c) converting U.S.
Treasury ▇▇▇▇ quotations to bond-equivalent yields in accordance with accepted
financial practice and (d) interpolating linearly between yields reported for
various maturities.
"REMAINING AVERAGE LIFE" shall mean, with respect to the Called Principal
of any Note, the number of years (calculated to the nearest one-twelfth year)
obtained by dividing (i) such Called Principal into (ii) the sum of the
products obtained by multiplying (a) each Remaining Scheduled Payment of such
Called Principal (but not of interest thereon) by (b) the number of years
(calculated to the nearest one-twelfth year) which will elapse between the
Settlement Date with respect to such Called Principal and the scheduled due date
of such Remaining Scheduled Payment.
"REMAINING SCHEDULED PAYMENTS" shall mean, with respect to the Called
Principal of any Note, all payments of such Called Principal and interest
thereon that would be due on or after the Settlement Date with respect to such
Called Principal if no payment of such Called Principal were made prior to its
scheduled due date.
"SETTLEMENT DATE" shall mean, with respect to the Called Principal of any
Note, the date on which such Called Principal is to be prepaid pursuant to
paragraph 4A or is declared to be immediately due and payable pursuant to
paragraph 7A, as the context requires.
"YIELD-MAINTENANCE AMOUNT" shall mean, with respect to any Note, an amount
equal to the excess, if any, of the Discounted Value of the Called Principal of
such Note over the sum of (i) such Called Principal plus (ii) interest accrued
thereon as of (including interest due on) the Settlement Date with respect to
such Called Principal. The Yield-Maintenance Amount shall in no event be less
than zero.
36
10B. OTHER TERMS.
"ACCEPTANCE" shall have the meaning specified in paragraph 2B(5).
"ACCEPTANCE DAY" shall have the meaning specified in paragraph 2B(5).
"ACCEPTANCE WINDOW" shall have the meaning specified in paragraph 2B(5).
"ACCEPTED NOTE" shall have the meaning specified in paragraph 2B(5).
"AFFILIATE" shall mean any Person directly or indirectly controlling,
controlled by, or under direct or indirect common control with, the Company,
except a Subsidiary. A Person shall be deemed to control a corporation if such
Person possesses, directly or indirectly, the power to direct or cause the
direction of the management and policies of such corporation, whether through
the ownership of voting securities, by contract or otherwise.
"AGREEMENT" shall mean this Note Agreement, together with all Exhibits and
Schedules hereto, as from time to time amended and supplemented.
"AGRIGOLDEN" shall mean AgriGolden, Inc., a corporation formed under the
laws of the State of Georgia.
"AUTHORIZED OFFICER" shall mean (i) in the case of the Company, its chief
executive officer, its chief financial officer, its Treasurer, any vice
president of the Company designated as an "Authorized Officer" of the Company in
the Information Schedule attached hereto or any vice president of the Company
designated as an "Authorized Officer" of the Company for the purpose of this
Agreement in an Officer's Certificate executed by the Company's chief executive
officer or chief financial officer and delivered to Prudential, and (ii) in the
case of Prudential, any officer of Prudential designated as its "Authorized
Officer" in the Information Schedule or any officer of Prudential designated as
its "Authorized Officer" for the purpose of this Agreement in a certificate
executed by one of its Authorized Officers. Any action taken under this
Agreement on behalf of the Company by any individual who on or after the date of
this Agreement shall have been an Authorized Officer of the Company and whom
Prudential in good faith believes to be an Authorized Officer of the Company at
the time of such action shall be binding on the Company even though such
individual shall have ceased to be an Authorized Officer of the Company, and any
action taken under this Agreement on behalf of Prudential by any individual who
on or after the date of this Agreement shall have been an Authorized Officer of
Prudential and whom the Company in good faith believes to be an Authorized
Officer
37
of Prudential at the time of such action shall be binding on Prudential even
though such individual shall have ceased to be an Authorized Officer of
Prudential.
"AVAILABLE FACILITY AMOUNT" shall have the meaning specified in paragraph
2B(1).
"BANKRUPTCY LAW" shall have the meaning specified in clause (viii) of
paragraph 7A.
"BUSINESS DAY" shall mean any day other than (i) a Saturday or a Sunday,
(ii) a day on which commercial banks in New York City are required or authorized
to be closed and (iii) for purposes of paragraph 2B(3) hereof only, a day on
which The Prudential Insurance Company of America is not open for business.
"CANCELLATION DATE" shall have the meaning specified in paragraph
2B(8)(iv).
"CANCELLATION FEE" shall have the meaning specified in paragraph
2B(8)(iv).
"CAPITALIZED LEASE OBLIGATION" shall mean any rental obligation which,
under generally accepted accounting principles, is or will be required to be
capitalized on the books of the Company or any Subsidiary, taken at the amount
thereof accounted for as indebtedness (net of interest expenses) in accordance
with such principles.
"CAROLINA GOLDEN" shall mean Carolina Golden Products Company, a general
partnership formed under the laws of the State of Georgia, with AgriGolden and
Golden Poultry acting as general partners.
"CLOSING DAY" shall mean, with respect to the Series A Notes, the Series A
Closing Day and, with respect to any Accepted Note, the Business Day specified
for the closing of the purchase and sale of such Accepted Note in the Request
for Purchase of such Accepted Note, provided that (i) if the Company and the
Purchaser which is obligated to purchase such Accepted Note agree on an earlier
Business Day for such closing, the "CLOSING DAY" for such Accepted Note shall be
such earlier Business Day, and (ii) if the closing of the purchase and sale of
such Accepted Note is rescheduled pursuant to paragraph 2B(7), the Closing Day
for such Accepted Note, for all purposes of this Agreement except references to
"original Closing Day" in paragraph 2B(8)(iii), shall mean the Rescheduled
Closing Day with respect to such Accepted Note.
"CODE" shall mean the Internal Revenue Code of 1986, as amended.
38
"CONFIRMATION OF ACCEPTANCE" shall have the meaning specified in paragraph
2B(5).
"CONSOLIDATED CURRENT ASSETS" shall mean the current assets of the Company
and its Restricted Subsidiaries, determined on a consolidated basis in
accordance with GAAP.
"CONSOLIDATED CURRENT LIABILITIES" shall mean the current liabilities of
the Company and its Restricted Subsidiaries, determined on a consolidated basis
in accordance with GAAP.
"CONSOLIDATED FUNDED DEBT" shall mean (a) Funded Debt of the Company and
its Restricted Subsidiaries, plus (b) (i) 50% of the Funded Debt of Golden
Peanut if ▇▇▇▇▇▇-▇▇▇▇▇▇▇-Midland Company is a general partner of Golden Peanut
or (ii) 100% of the Funded Debt of Golden Peanut in all other cases, plus (c)
100% of the Funded Debt of Young Pecan, plus (d) the Funded Debt of any other
Person which (i) has been guaranteed by the Company or any Restricted Subsidiary
or (ii) is supported by a letter of credit issued for the account of the Company
or any Restricted Subsidiary, all consolidated in accordance with GAAP.
"CONSOLIDATED INTEREST EXPENSE" shall mean, for any period, total interest
expense for such period of the Company and its Restricted Subsidiaries
(including without limitation, interest expense attributable to Capital Leases
in accordance with GAAP, all commissions, discounts and other fees and charges
owed with respect to bankers acceptance financing, and total interest expense
(whether shown as interest expense or as loss and expenses on sale of
receivables) under a receivables purchase facility) determined on a consolidated
basis in accordance with GAAP.
"CONSOLIDATED LEASE EXPENSE" shall mean, for any period, the total rental
obligations under operating leases for such period of the Company and its
Restricted Subsidiaries determined on a consolidated basis in accordance with
GAAP.
"CONSOLIDATED NET EARNINGS" shall mean consolidated gross revenues of the
Company and its Restricted Subsidiaries before extraordinary items (but after
giving effect to the credit resulting from any tax loss carry forwards) less all
operating and non-operating expenses of the Company and its Restricted
Subsidiaries including all charges of a proper character (including current and
deferred taxes on income and current additions to reserves but excluding equity
losses of Golden Peanut and Young Pecan, if any), but not including in gross
revenues any gains (net of expenses and taxes applicable thereto) in excess of
losses resulting from the sale, conversion or other disposition of capital
assets (i.e., assets other than current assets), any gains
39
resulting from the write-up of assets, any equity of the Company or any
Restricted Subsidiary in the unremitted earnings of any corporation which is not
a Subsidiary or any earnings of any Person acquired by the Company or any
Restricted Subsidiary through purchase, merger or consolidation or otherwise for
any year prior to the year of acquisition, or any deferred credit representing
the excess of equity in any Subsidiary at the date of acquisition over the cost
of investment in such Subsidiary; all determined in accordance with GAAP.
"CONSOLIDATED NET EARNINGS AVAILABLE FOR RESTRICTED PAYMENTS" shall mean an
amount equal to the sum of (a) $30,000,000 plus (b) 50% of Consolidated Net
Earnings (less 100% of cumulative net losses) for the period (taken as one
accounting period) commencing on July 1, 1996 and terminating at the end of the
last fiscal quarter preceding the date of any proposed Restricted Payment.
"CONSOLIDATED NET WORTH" shall mean the net worth of the Company and its
Restricted Subsidiaries, consolidated in accordance with GAAP.
"CONSOLIDATED SENIOR FUNDED DEBT" shall mean all Consolidated Funded Debt
less Subordinated Debt.
"CONSOLIDATED TOTAL ASSETS" shall mean all assets of the Company and its
Restricted Subsidiaries, consolidated in accordance with GAAP.
"CROP INDEBTEDNESS" shall mean any Debt incurred by the Company, any
Restricted Subsidiary, Golden Peanut, Young Pecan or any other Person (if the
Company or any Restricted Subsidiary is liable, directly or contingently, for
the Debt of such Person), for the sole purpose of buying crops for resale (other
than as an ingredient), as reasonably identified in good faith by the Company
and so certified to the Agent.
"CROP YEAR" shall mean the twelve month period beginning July 1 for those
crops harvested in that period.
"CUMULATIVE PREFERRED CERTIFICATES OF INTEREST" shall mean those debt
instruments issued by the Company to the public prior to 1977, and which have no
maturity dates.
"CURRENT DEBT" shall mean any indebtedness for money borrowed (including
Crop Indebtedness, subordinated loan certificates, bankers acceptances,
commodity discount loans, and notes payable and drafts accepted representing
extensions of credit whether or not representing obligations for borrowed money,
but excluding the
40
current portion of Funded Debt) payable on demand or within a period of one year
from the date of the creation thereof; provided that any obligation (other than
Crop Indebtedness which is not Long-term Crop Indebtedness) shall be treated as
Funded Debt, regardless of its term, if such obligation is renewable pursuant to
the terms thereof or of a revolving credit or similar agreement effective for
more than one year after the date of creation of such obligation, or may be
payable out of the proceeds of a similar obligation pursuant to the terms of
such obligation or of any such agreement. Any obligation secured by a Lien on,
or payable out of the proceeds of production from, property of the company or
any Subsidiary shall be deemed to be Funded Debt or Current Debt, as the case
may be, of the Company or such Subsidiary even though such obligation shall not
be assumed by the Company or such Subsidiary.
"DEBT" shall mean Funded Debt and Current Debt, as the case may be.
"EBIT" shall mean, for any period, an amount equal to (a) the sum for such
period of Consolidated Net Earnings plus, to the extent subtracted in
determining such Consolidated Net Earnings, provisions for taxes based on income
and Consolidated Interest Expense, minus (b) any items of gain or plus any items
of loss, which were included in determining such Consolidated Net Earnings and
were (1) not realized in the ordinary course of business or (2) the result of
any sale of assets.
"ENVIRONMENTAL LAWS" shall mean all federal, state, local and foreign
statutes and codes or regulations, rules or ordinances issued, promulgated, or
approved thereunder, now or hereafter in effect (including, without limitation,
those with respect to asbestos or asbestos containing material or exposure to
asbestos or asbestos containing material), relating to pollution or protection
of the environment and relating to public health and safety, relating to (i)
emissions, discharges, releases or threatened releases of pollutants,
contaminants, chemicals or industrial toxic or hazardous constituents,
substances or wastes, including, without limitation, any Hazardous Substances,
petroleum, including crude oil or any fraction thereof, any petroleum product or
other waste, chemicals or substances regulated by any Environmental Law into the
environment (including, without limitation, ambient air, surface water, ground
water, land surface or subsurface strata), or (ii) the manufacture, processing,
distribution, use, generation, treatment, storage, disposal, transport or
handling of any Hazardous Substances, petroleum, including crude oil or any
fraction thereof, any petroleum product or other waste, chemicals or substances
regulated by any Environmental Law, and (iii) underground storage tanks and
related piping, and emissions, discharges and releases or threatened releases
therefrom, such Environmental Laws to include, without limitation, (i) the Clean
Air Act (42 U.S.C. (S) 7401 et seq.), (ii) the Clean Water Act (33 U.S.C. (S)
1251 et seq.), (iii) the Resource
41
Conservation and Recovery Act (42 U.S.C. (S) 6901 et seq.), (iv) the
Toxic Substances Control Act (15 U.S.C. (S) 2601 et seq.), and (v) the
Comprehensive Environmental Response Compensation and Liability Act, as amended
by the Superfund Amendments and Reauthorization Act (42 U.S.C. (S) 9601 et
seq.).
"ERISA" shall mean the Employee Retirement Income Security Act of 1974, as
amended.
"ERISA AFFILIATE" shall mean any corporation which is a member of the same
controlled group of corporations as the Company within the meaning of section
414(b) of the Code, or any trade or business which is under common control with
the Company within the meaning of section 414(c) of the Code.
"EVENT OF DEFAULT" shall mean any of the events specified in paragraph 7A,
provided that there has been satisfied any requirement in connection with such
event for the giving of notice, or the lapse of time, or the happening of any
further condition, event or act, and "DEFAULT" shall mean any of such events,
whether or not any such requirement has been satisfied.
"EXCHANGE ACT" shall mean the Securities Exchange Act of 1934, as amended.
"FACILITY" shall have the meaning specified in paragraph 2B(1).
"FACILITY FEE" shall have the meaning specified in paragraph 2B(8)(i).
"FUNDED DEBT" shall mean, as to any Person, and include without
duplication:
(a) all Indebtedness for money borrowed, including, without
limitation, purchase money mortgages, leases capitalized in accordance with
Financial Accounting Standards Board Statement No. 13, outstandings under
asset securitization programs, conditional sales contracts and similar
title retention debt instruments (including any current maturities of such
indebtedness) payable more than one year from the date of calculation
thereof or which is renewable under any revolving or similar agreement,
which under GAAP is shown on the balance sheet as a liability (but
excluding reserves for deferred income taxes and other reserves to the
extent such reserves do not constitute an obligation); and
(b) Guarantees, endorsements (other than endorsements of negotiable
instruments for collection in the ordinary course of business) and
42
other contingent liabilities (whether direct or indirect) in connection
with the obligations, stock or dividends of any other Person; and
(c) obligations under any other contract in connection with any
borrowing which, in effect, is substantially equivalent to a guarantee
(other than obligations of Young Pecan and Golden Peanut which do not
constitute Long-term Crop Indebtedness); and
(d) obligations with respect to any redeemable preferred stock which
is required or scheduled to be redeemed within one year from the date of
calculation; and
(e) obligations outstanding under the 364-Day Loans, to the extent
that such obligations exceed eighty percent (80%) of the Company's
inventory balance as of the date of such calculation; and
(f) Long-term Crop Indebtedness.
Any obligation secured by a Lien on, or payable out of the proceeds of
production from, property of the Company or any Subsidiary shall be deemed to be
Funded Debt or Current Debt, as the case may be, of the Company or such
Subsidiary even though such obligation shall not be assumed by the Company or
such Subsidiary.
"ENVIRONMENTAL JUDGMENTS AND ORDERS" shall mean all judgments, decrees or
orders arising from or in any way associated with any Environmental
Requirements, whether or not entered upon consent or written agreements with an
Environmental Authority or other entity arising from or in any way associated
with any Environmental Requirement, whether or not incorporated in a judgment,
degree or order.
"ENVIRONMENTAL LIABILITIES" shall mean any liabilities, whether accrued or
contingent, arising from or relating in any way to any Environmental
Requirements.
"ENVIRONMENTAL NOTICES" shall mean any written communication from any
Environmental Authority stating possible or alleged noncompliance with or
possible or alleged liability under any Environmental Requirement, including
without limitation any complaints, citations, demands or requests from any
Environmental Authority for correction of any purported violation of any
Environmental Requirements or any investigation concerning any purported
violation of any Environmental Requirements. Environmental Notices also shall
mean (i) any written communication from any other Person threatening litigation
or administrative proceedings against or involving the
43
Company relating to alleged violation of any Environmental Requirements and (ii)
any complaint, petition or similar documents filed by any other Person
commencing litigation or administrative proceedings against or involving the
Company relating to alleged violation of any Environmental Requirements.
"ENVIRONMENTAL PROCEEDINGS" shall mean any judicial or administrative
proceedings arising from or in any way associated with any Environmental
Requirement.
"ENVIRONMENTAL RELEASES" shall mean releases (as defined in CERCLA or under
any applicable state or local environmental law or regulation) of Hazardous
Materials. Environmental Releases does not include releases for which no
remediation or reporting is required by applicable Environmental Requirements
and which do not present a danger to health, safety or the environment.
"ENVIRONMENTAL REQUIREMENTS" shall mean any applicable local, state or
federal law, rule, regulation, permit, order, decision, determination or
requirement relating in any way to Hazardous Materials or to health, safety or
the environment.
"GAAP" shall mean generally accepted accounting principles as set forth in
statements from Auditing Standards No. 69 issued by the Auditing Standards Board
of the American Institute of Certified Public Accountants as well as statements
and pronouncements of the Financial Accounting Standards Board that are
applicable, in each case as such principles are supplemented and amended from
time to time.
"GC PROPERTIES" shall mean GC Properties, a general partnership formed
under the laws of the State of Georgia, with the Company and Cotton States
Insurance Companies acting as the general partners.
"GK FINANCE" shall mean GK Finance Corporation, a corporation organized and
existing under the laws of the State of Delaware, which is a wholly-owned
Subsidiary of the Company.
"GOLDEN PEANUT"shall mean Golden Peanut Company, a general partnership
formed under the laws of the State of Georgia with the Company, Alimenta (USA),
Inc., a Florida corporation, and ▇▇▇▇▇▇-▇▇▇▇▇▇▇-Midland Company, a Delaware
corporation, acting as general partners.
"GOLDEN POULTRY" shall mean Golden Poultry Company, Inc., a corporation
organized and existing under the laws of the State of Georgia, which is a
Subsidiary of the Company.
44
"GUARANTEE" shall mean, with respect to any Person, any direct or indirect
liability, contingent or otherwise, of such Person with respect to any
indebtedness, lease, dividend or other obligation of another, including, without
limitation, any such obligation directly or indirectly guaranteed, endorsed
(otherwise than for collection or deposit in the ordinary course of business) or
discounted or sold with recourse by such Person, or in respect of which such
Person is otherwise directly or indirectly liable, including, without
limitation, any such obligation in effect guaranteed by such Person through any
agreement (contingent or otherwise) to purchase, repurchase or otherwise acquire
such obligation or any security therefor, or to provide funds for the payment or
discharge of such obligation (whether in the form of loans, advances, stock
purchases, capital contributions or otherwise), or to maintain the solvency or
any balance sheet or other financial condition of the obligor of such
obligation, or to make payment for any products, materials or supplies or for
any transportation or service, regardless of the non-delivery or non-furnishing
thereof, in any such case if the purpose or intent of such agreement is to
provide assurance that such obligation will be paid or discharged, or that any
agreements relating thereto will be complied with, or that the holders of such
obligation will be protected against loss in respect thereof. The amount of any
Guarantee shall be equal to the outstanding principal amount of the obligation
guaranteed or such lesser amount to which the maximum exposure of the guarantor
shall have been specifically limited.
"HAZARDOUS SUBSTANCES" shall have the meaning assigned to that term in the
Comprehensive Environmental Response Compensation and Liability Act of 1980, as
amended by the Superfund Amendments and Reauthorization Acts of 1986.
"HEDGE TREASURY NOTE(S)" shall mean, with respect to any Accepted Note, the
United States Treasury Note or Notes whose duration (as determined by
Prudential) most closely matches the duration of such Accepted Note.
"HEDGING CONTRACTS" shall mean any forward contracts, futures contracts,
foreign exchange contracts, currency swap agreements, interest rate exchange
agreements, interest rate cap agreements, interest rate collar agreements, and
other similar agreements and arrangements entered into by any Person designed to
protect against fluctuations in either foreign exchange rates or interest rates.
"HOSTILE TENDER OFFER" shall mean, with respect to the use of proceeds of
any Note, any offer to purchase, or any purchase of, shares of capital stock of
any corporation (other than Golden Poultry) or equity interests in any other
entity (other than Golden Poultry), or securities convertible into or
representing the beneficial ownership of, or rights to acquire, any such shares
or equity interests, if such shares, equity interests, securities or rights are
of a class which is publicly traded on any
45
securities exchange or in any over-the-counter market, other than purchases of
such shares, equity interests, securities or rights representing less than 5% of
the equity interests or beneficial ownership of such corporation or other entity
for portfolio investment purposes, and such offer or purchase has not been duly
approved by the board of directors of such corporation or the equivalent
governing body of such other entity prior to the date on which the Company makes
the Request for Purchase of such Note.
"INCLUDING" shall mean, unless the context clearly requires otherwise,
"including without limitation".
"INDEBTEDNESS" of any Person shall mean, without duplication (i) all
obligations of such Person which in accordance with GAAP would be shown on the
balance sheet of such Person as a liability (including, without limitation,
obligations for borrowed money and for the deferred purchase price of property
or services, and obligations evidenced by bonds, debentures, notes or other
similar instruments); (ii) all rental obligations under leases required to be
capitalized under GAAP; (iii) all Guaranties of such Person (including
contingent reimbursement obligations under undrawn letters of credit); (iv)
Indebtedness of others secured by any Lien upon property owned by such Person,
whether or not assumed; and (v) obligations or other liabilities under Hedging
Contracts, or similar agreements or combinations thereof which are disclosed as
liabilities on the balance sheet of such Person in accordance with GAAP.
"ISSUANCE PERIOD" shall have the meaning specified in paragraph 2B(2).
"LIEN" shall mean any mortgage, pledge, security interest, encumbrance,
lien (statutory or otherwise) or charge of any kind (including any agreement to
give any of the foregoing, any conditional sale or other title retention
agreement, any lease in the nature thereof, and the filing of or agreement to
give any financing statement under the Uniform Commercial Code of any
jurisdiction) or any other type of preferential arrangement for the purpose, or
having the effect, of protecting a creditor against loss or securing the payment
or performance of an obligation, including any rights of setoff (whether by
statute, common law, contract or otherwise).
"LONG-TERM CROP INDEBTEDNESS" shall mean (a) whenever the Old Crop
Inventory Percentage is greater than 5% at the end of any calendar quarter, the
Modified Old Crop Inventory Percentage multiplied by the amount of Crop
Indebtedness, or (b) whenever the Old Crop Inventory Percentage is less than 5%,
zero.
46
"MATERIAL ADVERSE EFFECT" shall mean any material adverse change in (i) the
business, results of operations, financial condition, assets or prospects of the
Company and the Subsidiaries, taken as a whole, or (ii) the ability of Company
or the Subsidiaries to perform their obligations under this Agreement.
"MODIFIED OLD CROP INVENTORY PERCENTAGE" shall mean for any particular Crop
Year the value of either the peanut or pecan crop, as applicable, remaining in
the inventory of the Company, any Restricted Subsidiary, Golden Peanut or Young
Pecan at the end of the Peanut Sale Cycle or the Pecan Sale Cycle for that
particular Crop Year divided by the total inventory value for either peanuts or
pecans, expressed as a percentage.
"MULTIEMPLOYER PLAN" shall mean any Plan which is a "multiemployer plan"
(as such term is defined in section 4001(a)(3) of ERISA.
"NOTES" shall have the meaning specified in paragraph 1B.
"OFFICER'S CERTIFICATE" shall mean a certificate signed in the name of the
Company by an Authorized Officer of the Company.
"OLD CROP INVENTORY PERCENTAGE" shall mean for any particular Crop Year the
value of either the peanut or pecan crop, as applicable, remaining in the
inventory of the Company, any Restricted Subsidiary, Golden Peanut or Young
Pecan at the end of the Peanut Sale Cycle or the Pecan Sale Cycle for that
particular Crop Year divided by the total cost of procuring those crops,
expressed as a percentage.
"OTHER PRUDENTIAL AGREEMENTS" shall mean that certain (i) Note Agreement
dated as of November 4, 1988 with respect to 9.90% Senior Notes due December 31,
1998 and (ii) Note Agreement dated as of June 3, 1991 with respect to 9.35%
Senior Notes due June 28, 2001, as each such Agreement may be amended, modified
or supplemented from time to time in accordance with its terms.
"PATRON'S AND OTHER EQUITY" shall mean the total of all capital stock
including cumulative certificates of interest, revolving fund certificates,
patronage reserves, other equity and retained earnings of the Company as
indicated in the Company's consolidated balance sheets.
"PEANUT SALE CYCLE" shall mean the period of time from September 1 of any
Crop Year to the last Business Day of January in the year which is two years
after such Crop Year.
47
"PECAN SALE CYCLE" shall mean the period of time from October 1 of any Crop
Year to the last Business Day of January in the year which is two years after
such Crop Year.
"PERSON" shall mean and include an individual, a partnership, a joint
venture, a corporation, a limited liability corporation or partnership, a trust,
an unincorporated organization and a government or any department or agency
thereof.
"PLAN" shall mean any employee pension benefit plan (as such term is
defined in section 3 of ERISA) which is or has been established or maintained,
or to which contributions are or have been made, by the Company or any ERISA
Affiliate.
"PRUDENTIAL" shall mean The Prudential Insurance Company of America.
"PRUDENTIAL AFFILIATE" shall mean any corporation or other entity all of
the Voting Stock (or equivalent voting securities or interests) of which is
owned by Prudential either directly or through Prudential Affiliates.
"PURCHASERS" shall mean Prudential with respect to the Series A Notes and,
with respect to any Accepted Notes, Prudential and/or the Prudential
Affiliate(s), which are purchasing such Accepted Notes.
"QPAM EXEMPTION" means Prohibited Transaction Class Exemption 84-14 issued
by the United States Department of Labor.
"REQUEST FOR PURCHASE" shall have the meaning specified in paragraph 2B(3).
"REQUIRED HOLDER(S)" shall mean the holder or holders of at least 66 2/3%
of the aggregate principal amount of the Notes or of a Series of Notes, as the
context may require, from time to time outstanding.
"RESCHEDULED CLOSING DAY" shall have the meaning specified in paragraph
2B(7).
"RESPONSIBLE OFFICER" shall mean the chief executive officer, chief
operating officer, chief financial officer, treasurer or chief accounting
officer of the Company, general counsel of the Company or any other officer of
the Company involved principally in its financial administration or its
controllership function.
"RESTRICTED SUBSIDIARIES" shall mean all of the Company's Subsidiaries
except Golden Poultry; provided, however, that if the Company acquires all of
the remaining
48
outstanding common stock of Golden Poultry, then Golden Poultry shall be deemed
to be a Restricted Subsidiary.
"SECURITIES ACT" shall mean the Securities Act of 1933, as amended.
"SERIES" shall have the meaning specified in paragraph 1B.
"SERIES A CLOSING DAY" shall have the meaning specified in paragraph 2A.
"SERIES A NOTE(S)" shall have the meaning specified in paragraph 1A.
"SHAREHOLDERS' EQUITY" shall mean, with respect to any Person as at any
date of determination, shareholders' equity of such Person determined on a
consolidated basis in conformity with GAAP.
"SIGNIFICANT HOLDER" shall mean (i) Prudential, so long as Prudential or
any Prudential Affiliate shall hold (or be committed under this Agreement to
purchase) any Note, or (ii) any other holder of at least 5% of the aggregate
principal amount of the Notes of any Series from time to time outstanding.
"SUBORDINATED CAPITAL CERTIFICATES OF INTEREST" shall mean those debt
instruments issued by the Company to the public under Trust Indentures with
SunTrust Bank, Atlanta, Georgia, as Trustee, registered with the United States
Securities and Exchange Commission and having maturities of greater than one
year.
"SUBORDINATED DEBT" shall mean all Indebtedness for money borrowed wherein
the principal and premium, if any, and interest is subordinated and junior in
right of payment to the prior payment in full of all other Indebtedness of the
Company for money borrowed except other Subordinated Debt including, but not
limited to, the Subordinated Capital Certificates of Interest, Subordinated Loan
Certificates, Subordinated Large Denomination Loan Certificates, and Cumulative
Preferred Capital Certificates of Interest, issued by the Company, an example of
whose subordination provisions is annexed hereto as Schedule 10B-1.
"SUBORDINATED LOAN CERTIFICATES" shall mean those debt instruments issued
by the Company to the public under Trust Indentures with SunTrust Bank, Atlanta,
Georgia, as Trustee, registered with the United Stated Securities and Exchange
Commission and having maturities of one year or less.
"SUBSIDIARY" shall mean any corporation, association or partnership
organized under the laws of any State of the United States of America, Canada,
or any Province
49
of Canada, which conducts the major portion of its business in and makes the
major portion of its sales to Persons located in the United States of America,
Canada, and at least a majority of the Voting Stock of which shall, at the time
as of which any determination is being made, be owned by the Company either
directly or through Subsidiaries, including, without limitation, as of the date
thereof, those Subsidiaries listed on Schedule 10B-2 hereto.
"TOTAL CAPITAL" shall mean the sum of Funded Debt and Shareholders' Equity.
"TRANSFEREE" shall mean any direct or indirect transferee of all or any
part of any Note purchased by any Purchaser under this Agreement.
"VOTING STOCK" shall mean, with respect to any corporation, any shares of
stock of such corporation whose holders are entitled under ordinary
circumstances to vote for the election of directors of such corporation
(irrespective of whether at the time stock of any other class or classes shall
have or might have voting power by reason of the happening of any contingency).
"YOUNG PECAN" shall mean Young Pecan Company, a general partnership formed
under the laws of the State of South Carolina with GK Pecans, Inc. and Y Pecans,
Inc., a South Carolina corporation, as general partners.
10C. ACCOUNTING PRINCIPLES, TERMS AND DETERMINATIONS. All references
in this Agreement to "generally accepted accounting principles" shall be deemed
to refer to generally accepted accounting principles in effect in the United
States at the time of application thereof. Unless otherwise specified herein,
all accounting terms used herein shall be interpreted, all determinations with
respect to accounting matters hereunder shall be made, and all unaudited
financial statements and certificates and reports as to financial matters
required to be furnished hereunder shall be prepared, in accordance with
generally accepted accounting principles applied on a basis consistent with the
most recent audited financial statements delivered pursuant to clause (ii) of
paragraph 5A or, if no such statements have been so delivered, the most recent
audited financial statements referred to in clause (i) of paragraph 8B.
11. MISCELLANEOUS.
11A. NOTE PAYMENTS. The Company agrees that, so long as any Purchaser
shall hold any Note, it will make payments of principal of, interest on, and any
Yield-Maintenance Amount payable with respect to, such Note, which comply with
the terms of this Agreement, by wire transfer of immediately available funds for
credit (not later than 12:00 noon, New York City local time, on the date due) to
(i) the
50
account or accounts of such Purchaser specified in the Purchaser Schedule
attached hereto in the case of any Series A Note, (ii) the account or accounts
of such Purchaser specified in the Confirmation of Acceptance with respect to
such Note in the case of any Shelf Note or (iii) such other account or accounts
in the United States as such Purchaser may from time to time designate in
writing, notwithstanding any contrary provision herein or in any Note with
respect to the place of payment. Each Purchaser agrees that, before disposing of
any Note, it will make a notation thereon (or on a schedule attached thereto) of
all principal payments previously made thereon and of the date to which interest
thereon has been paid. The Company agrees to afford the benefits of this
paragraph 11A to any Transferee which shall have made the same agreement as the
Purchasers have made in this paragraph 11A.
11B. EXPENSES. The Company agrees, whether or not the transactions
contemplated hereby shall be consummated, to pay, and save Prudential, each
Purchaser and any Transferee harmless against liability for the payment of, all
out-of-pocket expenses arising in connection with such transactions, including
(i) all document production and duplication charges and the fees and expenses of
any special counsel engaged by the Purchasers or any Transferee in connection
with this Agreement (other than with respect to the initial transfer to the
Transferee), the transactions contemplated hereby and any subsequent proposed
modification of, or proposed consent under, this Agreement, whether or not such
proposed modification shall be effected or proposed consent granted, and (ii)
the costs and expenses, including attorneys' fees, incurred by any Purchaser or
any Transferee in enforcing (or determining whether or how to enforce) any
rights under this Agreement or the Notes or in responding to any subpoena or
other legal process or informal investigative demand issued in connection with
this Agreement or the transactions contemplated hereby or by reason of any
Purchaser's or any Transferee's having acquired any Note, including without
limitation costs and expenses incurred in any bankruptcy case. The obligations
of the Company under this paragraph 11B shall survive the transfer of any Note
or portion thereof or interest therein by any Purchaser or any Transferee and
the payment of any Note.
11C. CONSENT TO AMENDMENTS. This Agreement may be amended, and the
Company may take any action herein prohibited, or omit to perform any act herein
required to be performed by it, if the Company shall obtain the written consent
to such amendment, action or omission to act, of the Required Holder(s) of the
Notes of each Series except that, (i) with the written consent of the holders of
all Notes of a particular Series, and if an Event of Default shall have occurred
and be continuing, of the holders of all Notes of all Series, at the time
outstanding (and not without such written consents), the Notes of such Series
may be amended or the provisions thereof waived to change the maturity thereof,
to change or affect the principal thereof, or to
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change or affect the rate or time of payment of interest on or any Yield-
Maintenance Amount payable with respect to the Notes of such Series, (ii)
without the written consent of the holder or holders of all Notes at the time
outstanding, no amendment to or waiver of the provisions of this Agreement shall
change or affect the provisions of paragraph 7A or this paragraph 11C insofar as
such provisions relate to proportions of the principal amount of the Notes of
any Series, or the rights of any individual holder of Notes, required with
respect to any declaration of Notes to be due and payable or with respect to any
consent, amendment, waiver or declaration, (iii) with the written consent of
Prudential (and not without the written consent of Prudential) the provisions of
paragraph 2B may be amended or waived (except insofar as any such amendment or
waiver would affect any rights or obligations with respect to the purchase and
sale of Notes which shall have become Accepted Notes prior to such amendment or
waiver), and (iv) with the written consent of all of the Purchasers which shall
have become obligated to purchase Accepted Notes of any Series (and not without
the written consent of all such Purchasers), any of the provisions of paragraphs
2B and 3 may be amended or waived insofar as such amendment or waiver would
affect only rights or obligations with respect to the purchase and sale of the
Accepted Notes of such Series or the terms and provisions of such Accepted
Notes. Each holder of any Note at the time or thereafter outstanding shall be
bound by any consent authorized by this paragraph 11C, whether or not such Note
shall have been marked to indicate such consent, but any Notes issued thereafter
may bear a notation referring to any such consent. No course of dealing between
the Company and the holder of any Note nor any delay in exercising any rights
hereunder or under any Note shall operate as a waiver of any rights of any
holder of such Note. As used herein and in the Notes, the term "this Agreement"
and references thereto shall mean this Agreement as it may from time to time be
amended or supplemented.
11D. FORM, REGISTRATION, TRANSFER AND EXCHANGE OF NOTES; LOST NOTES.
The Notes are issuable as registered notes without coupons in denominations of
at least $1,000,000, except as may be necessary to reflect any principal amount
not evenly divisible by $1,000,000. The Company shall keep at its principal
office a register in which the Company shall provide for the registration of
Notes and of transfers of Notes. Upon surrender for registration of transfer of
any Note at the principal office of the Company, the Company shall, at its
expense, execute and deliver one or more new Notes of like tenor and of a like
aggregate principal amount, registered in the name of such transferee or
transferees. At the option of the holder of any Note, such Note may be
exchanged for other Notes of like tenor and of any authorized denominations, of
a like aggregate principal amount, upon surrender of the Note to be exchanged at
the principal office of the Company. Whenever any Notes are so surrendered for
exchange, the Company shall, at its expense, execute and deliver the Notes which
the holder making the exchange is entitled to receive. Each
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installment of principal payable on each installment date upon each new Note
issued upon any such transfer or exchange shall be in the same proportion to the
unpaid principal amount of such new Note as the installment of principal payable
on such date on the Note surrendered for registration of transfer or exchange
bore to the unpaid principal amount of such Note. No reference need be made in
any such new Note to any installment or installments of principal previously due
and paid upon the Note surrendered for registration of transfer or exchange.
Every Note surrendered for registration of transfer or exchange shall be duly
endorsed, or be accompanied by a written instrument of transfer duly executed,
by the holder of such Note or such holder's attorney duly authorized in writing.
Any Note or Notes issued in exchange for any Note or upon transfer thereof shall
carry the rights to unpaid interest and interest to accrue which were carried by
the Note so exchanged or transferred, so that neither gain nor loss of interest
shall result from any such transfer or exchange. Upon receipt of written notice
from the holder of any Note of the loss, theft, destruction or mutilation of
such Note and, in the case of any such loss, theft or destruction, upon receipt
of such holder's unsecured indemnity agreement, or in the case of any such
mutilation upon surrender and cancellation of such Note, the Company will make
and deliver a new Note, of like tenor, in lieu of the lost, stolen, destroyed or
mutilated Note.
11E. PERSONS DEEMED OWNERS; PARTICIPATIONS. Prior to due presentment
for registration of transfer, the Company may treat the Person in whose name any
Note is registered as the owner and holder of such Note for the purpose of
receiving payment of principal of and interest on, and any Yield-Maintenance
Amount payable with respect to, such Note and for all other purposes whatsoever,
whether or not such Note shall be overdue, and the Company shall not be affected
by notice to the contrary. Subject to the preceding sentence, the holder of any
Note may from time to time grant participations in all or any part of such Note
to any Person on such terms and conditions as may be determined by such holder
in its sole and absolute discretion.
11F. SURVIVAL OF REPRESENTATIONS AND WARRANTIES; ENTIRE AGREEMENT. All
representations and warranties contained herein or made in writing by or on
behalf of the Company in connection herewith shall survive the execution and
delivery of this Agreement and the Notes, the transfer by any Purchaser of any
Note or portion thereof or interest therein and the payment of any Note, and may
be relied upon by any Transferee, regardless of any investigation made at any
time by or on behalf of any Purchaser or any Transferee. Subject to the
preceding sentence, this Agreement and the Notes embody the entire agreement and
understanding between the parties hereto with respect to the subject matter
hereof and supersede all prior agreements and understandings relating to such
subject matter.
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11G. SUCCESSORS AND ASSIGNS. All covenants and other agreements in
this Agreement contained by or on behalf of any of the parties hereto shall bind
and inure to the benefit of the respective successors and assigns of the parties
hereto (including, without limitation, any Transferee) whether so expressed or
not.
11H. INDEPENDENCE OF COVENANTS. All covenants hereunder shall be
given independent effect so that if a particular action or condition is
prohibited by any one of such covenants, the fact that it would be permitted by
an exception to, or otherwise be in compliance within the limitations of,
another covenant shall not avoid the occurrence of a Default or Event of Default
if such action is taken or such condition exists.
11I. NOTICES. All written communications provided for hereunder
(other than communications provided for under paragraph 2) shall be sent by
first class mail or nationwide overnight delivery service (with charges prepaid)
and (i) if to any Purchaser, addressed as specified for such communications in
the Purchaser Schedule attached hereto (in the case of the Series A Notes) or
the Purchaser Schedule attached to the applicable Confirmation of Acceptance (in
the case of any Shelf Notes) or at such other address as any such Purchaser
shall have specified to the Company in writing, (ii) if to any other holder of
any Note, addressed to it at such address as it shall have specified in writing
to the Company or, if any such holder shall not have so specified an address,
then addressed to such holder in care of the last holder of such Note which
shall have so specified an address to the Company and (iii) if to the Company,
addressed to it at Gold ▇▇▇▇ Inc., ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇ ▇▇▇▇▇, Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇, Telecopier: ▇▇▇-▇▇▇-▇▇▇▇, provided,
however, that any such communication to the Company may also, at the option of
the Person sending such communication, be delivered by any other means either to
the Company at its address specified above or to any Authorized Officer of the
Company. Any communication pursuant to paragraph 2 shall be made by the method
specified for such communication in paragraph 2, and shall be effective to
create any rights or obligations under this Agreement only if, in the case of a
telephone communication, an Authorized Officer of the party conveying the
information and of the party receiving the information are parties to the
telephone call, and in the case of a telecopier communication, the communication
is signed by an Authorized Officer of the party conveying the information,
addressed to the attention of an Authorized Officer of the party receiving the
information, and in fact received at the telecopier terminal the number of which
is listed for the party receiving the communication in the Information Schedule
or at such other telecopier terminal as the party receiving the information
shall have specified in writing to the party sending such information.
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11J. PAYMENTS DUE ON NON-BUSINESS DAYS. Anything in this Agreement or
the Notes to the contrary notwithstanding, any payment of principal of or
interest on, or Yield-Maintenance Amount payable with respect to, any Note that
is due on a date other than a Business Day shall be made on the next succeeding
Business Day. If the date for any payment is extended to the next succeeding
Business Day by reason of the preceding sentence, the period of such extension
shall not be included in the computation of the interest payable on such
Business Day.
11K. SEVERABILITY. Any provision of this Agreement which is
prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof, and any such prohibition or
unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction.
11L. DESCRIPTIVE HEADINGS. The descriptive headings of the several
paragraphs of this Agreement are inserted for convenience only and do not
constitute a part of this Agreement.
11M. SATISFACTION REQUIREMENT. If any agreement, certificate or other
writing, or any action taken or to be taken, is by the terms of this Agreement
required to be satisfactory to any Purchaser, to any holder of Notes or to the
Required Holder(s), the determination of such satisfaction shall be made by such
Purchaser, such holder or the Required Holder(s), as the case may be, in the
sole and exclusive judgment (exercised in good faith) of the Person or Persons
making such determination.
11N. GOVERNING LAW. This Agreement shall be construed and enforced
in accordance with, and the rights of the parties shall be governed by, the law
of the State of New York. THE COMPANY HEREBY SUBMITS TO THE JURISDICTION OF THE
SUPREME COURT OF THE STATE OF NEW YORK LOCATED IN NEW YORK COUNTY, NEW YORK AND
THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF NEW YORK AND
IRREVOCABLY AGREES THAT, SUBJECT TO THE SOLE AND ABSOLUTE ELECTION OF THE
REQUIRED HOLDER(S) AND TO THE EXTENT PERMITTED BY APPLICABLE LAW, ALL ACTIONS OR
PROCEEDINGS RELATING TO THIS AGREEMENT OR THE NOTES SHALL BE LITIGATED IN SUCH
COURTS, AND THE COMPANY WAIVES ANY OBJECTION WHICH IT MAY HAVE BASED ON IMPROPER
VENUE OR FORUM NON CONVENIENS TO THE CONDUCT OF ANY PROCEEDING IN ANY SUCH
COURTS.
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11O. SEVERALTY OF OBLIGATIONS. The sales of Notes to the Purchasers
are to be several sales, and the obligations of Prudential and the Purchasers
under this Agreement are several obligations. No failure by Prudential or any
Purchaser to perform its obligations under this Agreement shall relieve any
other Purchaser or the Company of any of its obligations hereunder, and neither
Prudential nor any Purchaser shall be responsible for the obligations of, or any
action taken or omitted by, any other such Person hereunder.
11P. COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each of which shall be an original, but all of which together
shall constitute one instrument.
11Q. BINDING AGREEMENT. When this Agreement is executed and delivered
by the Company, Prudential, it shall become a binding agreement between the
Company, and Prudential. This Agreement shall also inure to the benefit of each
Purchaser which shall have executed and delivered a Confirmation of Acceptance,
and each such Purchaser shall be bound by this Agreement to the extent provided
in such Confirmation of Acceptance.
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11R. AMENDMENT OF OTHER AGREEMENTS. Effective as of December 28,
1996, each of the Other Prudential Agreements are hereby amended pursuant to
paragraph 11C thereof by substituting for paragraph 6 thereof, paragraph 6 of
this Agreement. Defined terms and references employed in such substituted
provisions shall be given the meaning and effect provided for in this Agreement.
Very truly yours,
GOLD ▇▇▇▇ INC.
By:_________________________
Name:
Title:
The foregoing Agreement is
hereby accepted as of the
date first above written.
THE PRUDENTIAL INSURANCE
COMPANY OF AMERICA
By:__________________________
Vice President