ASSET PURCHASE AGREEMENT
among
▇▇▇▇▇▇ FARMS INCORPORATED,
as Purchaser,
▇▇▇▇▇'▇, INC. and ▇▇▇▇▇'▇ FARMS, INC.
together, as Seller
Dated as of January 23, 2004
TABLE OF CONTENTS
ARTICLE I. DEFINITIONS 1
1.1 DEFINITIONS 1
1.2 INTERPRETATION 8
ARTICLE II. PURCHASE & SALE OF PURCHASED ASSETS 8
2.1 PURCHASED ASSETS 8
2.2 EXCLUDED ASSETS 10
2.3 ASSUMED LIABILITIES 11
2.4 RETAINED LIABILITIES 11
2.5 PURCHASE PRICE; PAYMENT OF PURCHASE PRICE 12
2.6 ALLOCATION OF PURCHASE PRICE 13
2.7 CLOSING 14
ARTICLE III. REPRESENTATIONS AND WARRANTIES OF SELLER 14
3.1 ORGANIZATION AND QUALIFICATION 14
3.2 ARTICLES OF INCORPORATION AND BY-LAWS 14
3.3 AUTHORITY RELATIVE TO THIS AGREEMENT 14
3.4 NO CONFLICT 15
3.5 REQUIRED FILINGS AND CONSENTS 15
3.6 INVENTORY 15
3.7 ABSENCE OF CERTAIN CHANGES OR EVENTS 15
3.8 PROPERTIES; TITLE 17
3.9 CONTRACTS 19
3.10 PERMITS 20
3.11 COMPLIANCE WITH LAWS 21
3.12 CLAIMS AND PROCEEDINGS 21
3.13 BOOKS AND RECORDS 21
3.14 NO FINDER 21
3.15 ENVIRONMENTAL MATTERS 22
3.16 INSURANCE; FIDELITY BONDS 22
3.17 EMPLOYEE MATTERS 22
3.18 EMPLOYEE BENEFIT PLANS 23
3.20 PURCHASED ASSETS 24
ARTICLE IV. REPRESENTATIONS AND WARRANTIES OF PURCHASER 24
4.1 ORGANIZATION AND QUALIFICATION 25
4.2 AUTHORITY RELATIVE TO THIS AGREEMENT 25
4.3 NO CONFLICT 25
4.4 REQUIRED FILINGS AND CONSENTS 25
4.5 NO FINDER 25
ARTICLE V. COVENANTS OF THE PARTIES PRIOR TO CLOSING DATE 26
5.1 CONDUCT OF BUSINESS 26
5.2 CONSENTS, FILINGS AND AUTHORIZATIONS; EFFORTS TO CONSUMMATE 27
5.3 NO SHOP 27
5.4 NOTICES OF CERTAIN EVENTS 28
5.5 PUBLIC ANNOUNCEMENTS 28
5.6 CONFIDENTIALITY 28
5.7 EXPENSES 29
5.8 SUPPLEMENTS TO DISCLOSURE SCHEDULES 29
5.9 ACCESS TO INFORMATION; RECORDS 30
5.10 EMPLOYEES 30
5.11 PRE-CLOSING PROJECTS 31
ARTICLE VI. CONDITIONS TO CLOSING 31
6.1 CONDITIONS TO THE OBLIGATIONS OF SELLER AND PURCHASER 31
6.2 CONDITIONS TO OBLIGATIONS OF SELLER 32
6.3 CONDITIONS TO OBLIGATIONS OF PURCHASER 33
ARTICLE VII. TERMINATION; EFFECT OF TERMINATION 36
7.1 TERMINATION OF AGREEMENT 36
7.2 EFFECT OF TERMINATION; RIGHT TO PROCEED 37
ARTICLE VIII. POST-CLOSING COVENANTS 37
8.1 POST-CLOSING PROJECTS 37
8.2 CLAIMS UNDER INSURANCE POLICIES 37
8.3 CERTAIN TRANSITIONAL MATTERS 37
8.4 FURTHER ASSURANCES 38
ARTICLE IX. SURVIVAL; INDEMNIFICATION 38
9.1 SURVIVAL OF REPRESENTATIONS AND WARRANTIES 38
9.2 INDEMNIFICATION BY SELLER 39
9.3 INDEMNIFICATION BY PURCHASER 39
9.4 NOTICE OF CLAIMS 40
9.5 OPPORTUNITY TO DEFEND THIRD PARTY CLAIMS 40
9.6 INDEMNITY PAYMENTS 41
9.7 LIMITATIONS ON LIABILITY 41
9.8 EXCLUSIVE REMEDIES 42
ARTICLE X. GENERAL 42
10.1 NOTICES 42
10.2 SEVERABILITY; PARTIES IN INTEREST 43
10.3 ASSIGNMENT; BINDING EFFECT; BENEFIT 43
10.4 INCORPORATION OF EXHIBITS AND SCHEDULES 44
10.5 GOVERNING LAW 44
10.6 ARBITRATION 44
10.7 HEADINGS; INTERPRETATION 44
10.8 COUNTERPARTS 44
10.9 ENTIRE AGREEMENT 44
10.10 WAIVERS AND AMENDMENTS; NON-CONTRACTUAL REMEDIES; PRESERVATION OF
REMEDIES 45
SCHEDULES
Schedule 2.1(a) Real Property
Schedule 2.1(b) Tangible Personal Property
Schedule 2.1(d) Perry Leased Real Property
Schedule 2.1(e) Perry Leased Equipment
Schedule 2.1(f) Wastewater Facility Leased Real Property and Assets
Schedule 2.1(j) Prepaid Expenses
Schedule 3.4 Seller Conflicts
Schedule 3.5 Seller Required Filings and Consents
Schedule 3.6 Inventory
Schedule 3.7 Certain Changes or Events
Schedule 3.8(a)(i) Exceptions to Title to Real Property
Schedule 3.8(a)(ii) Survey Disclosures
Schedule 3.8(a)(iii) Lists of Title Insurance Policies, Deeds,
Appraisal Reports, etc.
Schedule 3.8(b)(i) Other Real Property Leases; Bond Encumbrances
Schedule 3.8(b)(ii) Exceptions to Title to Real Property Leases
Schedule 3.8(c) Encumbrances on Real Property and Real Property Leases
Schedule 3.8(d) Easements, Rights of Way and Licenses
Schedule 3.8(e) Operating Condition and Structural Defect Disclosures
Schedule 3.9(a) Listed Contracts
Schedule 3.9(b) Contract Defaults; Waivers
Schedule 3.10 Permits and Environmental Permits
Schedule 3.11 Compliance with Laws
Schedule 3.12 Claims and Proceedings
Schedule 3.13 Books and Records
Schedule 3.14 Finders - Retained by Seller
Schedule 3.15 Environmental Matters
Schedule 3.16 Insurance Policies and Fidelity Bonds
Schedule 3.17 Employees; Compensation
Schedule 3.18 Benefit Plans
Schedule 3.19 Liens
Schedule 4.3 Purchaser Conflicts
Schedule 4.4 Purchaser Required Filings and Consents
Schedule 4.5 Finders - Retained by Purchaser
Schedule 5.1 Conduct of Business
Schedule 5.11 Pre-Closing Projects
Schedule 8.1 Post-Closing Projects
ASSET PURCHASE AGREEMENT
THIS ASSET PURCHASE AGREEMENT is made as of January 23, 2004 among ▇▇▇▇▇▇
Farms Incorporated, a Maryland corporation ("Purchaser"), ▇▇▇▇▇'▇, Inc., a
Georgia corporation ("▇▇▇▇▇'▇") and ▇▇▇▇▇'▇ Farms, Inc., a Georgia corporation
("▇▇▇▇▇'▇ Farms" and together, jointly and severally, with ▇▇▇▇▇'▇, "Seller").
RECITALS:
WHEREAS, Seller engages in the business of poultry processing and related
activities at its poultry processing complex consisting of a poultry
processing plant in Perry, Georgia (the "Processing Plant") and a feed mill
and hatchery in Forsyth, Georgia (the "Feed Mill/Hatchery") (such poultry
processing business and related activities conducted at and in respect to the
Processing Plant and the Feed Mill/Hatchery, collectively, the "Business").
Subject to the terms and conditions set forth herein, Seller desires to sell,
convey, transfer, assign and deliver to Purchaser, and Purchaser desires to
purchase and acquire from Seller, free and clear of all Liens other than the
Permitted Encumbrances, all of Seller's right, title and interest in and to
all of the Purchased Assets (the "Acquisition").
NOW, THEREFORE, in consideration of the premises and for other good and
valuable consideration, the receipt and sufficiency of which are hereby
expressly acknowledged, the Parties, intending to be legally bound, hereby
agree as follows:
ARTICLE I. DEFINITIONS
1.1 As used herein, the following terms shall have the following meanings:
"AAA" shall have the meaning given to such term in Section 10.6.
"ACMs" shall have the meaning given to such term in Section 3.15.
"Acquisition" shall have the meaning given to such term in the Recitals.
"Affiliate" with respect to any Person, shall mean any other Person directly
or indirectly controlling, controlled by, or under common control with such
Person. For purposes of this definition, "control" (including, with
correlative meanings, the terms "controlled by" and "under common control
with"), as used with respect to any Person, shall mean the possession,
directly or indirectly, of the power to direct or cause the direction of the
management and policies of such Person, whether through the ownership of
voting securities or by contract or otherwise.
"Agreement" means this Asset Purchase Agreement.
"Asserted Liability" shall have the meaning given to such term in
Section 9.4.
"Assets" means properties, rights, interests and assets of every kind, real,
personal or mixed, tangible and intangible, used or usable by Seller in the
Business.
"Assigned Contracts" shall have the meaning given to such term in Section
2.1(h).
"Assignment and Assumption Agreement" shall have the meaning given to such
term in Section 2.5(c).
"Assumed Liabilities" shall have the meaning given to such term in Section
2.3.
"Bankruptcy Exception" shall have the meaning given to such term in Section
3.3.
"Benefit Plans" shall have the meaning given to such term in Section 3.18.
"▇▇▇▇ of Sale" shall have the meaning given to such term in Section 6.3(f)(v).
"Bond Assignment and Assumption Agreement" shall have the meaning given to
such term in Section 2.5(c).
"Bond Documents" shall include the Perry Real Property Lease, the Perry
Equipment Lease and that certain Indenture of Trust, between the DAHC and
SunTrust Bank, that certain Guaranty Agreement delivered in favor of SunTrust
Bank, that certain Bond Purchase Agreement, by and between Seller and DAHC,
that certain Home Office Payment Agreement, by and among DAHC, SunTrust Bank
and Seller, each of the foregoing dated as of September 1, 1999, and the
Bonds.
"Bond Encumbrances" shall have the meaning given to such term in Section
3.8(b).
"Bonds" shall have the meaning given to such term in Section 2.1(g).
"Books and Records" shall have the meaning given to such term in Section 3.13.
"Building 20 Items" shall have the meaning given to such term in Section
2.2(d).
"Business" shall have the meaning given to such term in the Recitals.
"Business Day" means any day other than a Saturday, Sunday or a day on which
banks in New York City, New York and Atlanta, Georgia are authorized or
obligated by applicable Law or executive Order to close or are otherwise
generally closed.
"CERCLA" shall have the meaning given to such term in Section 3.15.
"Claim" shall have the meaning given to such term in Section 3.12.
"Closing" shall have the meaning given to such term in Section 2.7.
"Closing Date" shall have the meaning given to such term in Section 2.7.
"COBRA" shall have the meaning given to such term in Section 3.17.
"Code" means the Internal Revenue Code of 1986, as amended and as it may be
amended from time to time, and any successor thereto. Any reference herein
to a specific section or sections of the Code shall be deemed to include a
reference to any corresponding provision of future law.
"Confidential Information" shall have the meaning given to such term in
Section 5.6.
"Contingent Purchase Price" shall have the meaning given to such term in
Section 2.5(a)(iii).
"Contract" means agreements, whether oral or written, including, without
limitation, contracts, promises, commitments, undertakings, leases,
guarantees, or other obligations that are binding upon Seller and which
relate to the Purchased Assets or the Business or the ownership,
construction, development, maintenance, repair, management, use, occupancy,
possession or operation thereof, or the operation of any of the programs or
services in conjunction with the Purchased Assets or the Business. For the
avoidance of doubt, the Bonds are not Contracts as such term is used herein.
"Controlled Group Member" shall have the meaning given to such term in
Section 3.18.
"DAHC" shall have the meaning given to such term in Section 2.1(d).
"Damages" shall mean and include any losses, Liabilities, obligations, claims,
demands, lawsuits, actions, damages, assessments, deficiencies, costs or
expenses (including reasonable legal fees, interest, penalties, and all
reasonable amounts paid in investigation, defense or settlement of any of the
foregoing and whether or not with respect to claims, demands, lawsuits, or
actions brought by third parties, such claims, demands, lawsuits or actions
are meritorious).
"Designated Accountant" shall have the meaning given to such term in Section
2.5(e).
"Environmental Law" means any statute, regulation, rule, code, common law,
Order or judgment of any applicable federal, state, local or foreign
jurisdiction relating to pollution, hazardous substances, hazardous wastes,
petroleum or otherwise relating to protection of the environment, natural
resources or human health, including, by way of example and not by way of
limitation, the Clean Air Act, the Clean Water Act, the Resource Conservation
Recovery Act ("RCRA"), CERCLA, the Toxic Substances Control Act ("TSCA"), and
the Emergency Planning and Community Right-to-Know Act, all as currently
amended.
"Environmental Permits" means those Permits required to be obtained by Seller
under Environmental Laws in connection with the Business or the use and
operation of the Purchased Assets owned or leased by Seller.
"ERISA" shall have the meaning given to such term in Section 3.18.
"Excluded Assets" shall have the meaning given to such term in Section 2.2.
"Form 8594" shall have the meaning given to such term in Section 2.6.
"GAAP" means generally accepted accounting principles applied on a consistent
basis in effect on the date hereof as set forth in the opinions and
pronouncements of the Accounting Principles Board of the American Institute
of Certified Public Accountants and statements and pronouncements of the
Financial Accounting Standards Board.
"Garage Lease" shall mean that certain Standard Business Contract between
▇▇▇▇▇'▇ and ▇.▇. ▇▇▇▇▇▇▇▇ dated December 23, 1991, pursuant to which ▇▇▇▇▇'▇
leases a vehicle garage, maintenance and repair facility located in the City
of Macon, Georgia.
"Governmental Authorities" means all agencies, authorities, bodies, boards,
commissions, courts, instrumentalities, legislatures and offices of any
nature whatsoever of any government, quasi-governmental unit or political
subdivision, whether foreign, federal, state, county, district, municipality,
city or otherwise.
"HSR Act" means the ▇▇▇▇-▇▇▇▇▇-▇▇▇▇▇▇ Antitrust Improvements Act of 1976, as
amended, together with the rules and regulations promulgated thereunder.
"Indemnification Basket" shall have the meaning given to such term in Section
9.7(a).
"Indemnification Cap" shall have the meaning given to such term in Section
9.7(b).
"Indemnified Party" shall have the meaning given to such term in Section 9.4.
"Indemnifying Party" shall have the meaning given to such term in Section 9.4.
"Insurance Policies" shall have the meaning given to such term in Section
3.16.
"Inventory" shall have the meaning given to such term in Section 2.1(c).
"Inventory Date" shall have the meaning given to such term in Section 2.5(e).
"Inventory Date Statement" shall have the meaning given to such term in
Section 2.5(e).
"Inventory Purchase Price" shall have the meaning given to such term in
Section 2.5(e).
"IRS" means the United States Internal Revenue Service.
"Knowledge" means the actual knowledge of a particular fact or other matter
being possessed as of the pertinent date by any director or officer of Seller
or by ▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇,
▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇ or ▇▇▇▇▇▇ ▇▇▇▇▇▇, after reasonable inquiry or, if
such inquiry has not been made, knowledge that a prudent individual could be
expected to discover or otherwise become aware of after such an inquiry.
"Laws" means any Federal, state, foreign or local statute, law, ordinance,
regulation, rule, code, Order, other requirement or rule of law.
"Leased Garage" shall mean that certain vehicle garage, maintenance and repair
facility leased by ▇▇▇▇▇'▇ pursuant to the Garage Lease.
"Liability" means any direct or indirect indebtedness, liability, assessment,
expense, claim, loss, damage, deficiency, obligation or responsibility, known
or unknown, disputed or undisputed, joint or several, vested or unvested,
executory or not, fixed or unfixed, ▇▇▇▇▇▇ or inchoate, liquidated or
unliquidated, secured or unsecured, determinable or undeterminable, accrued
or unaccrued, absolute or not, actual or potential, contingent or otherwise
(including any liability under any guarantees, letters of credit, performance
credits or with respect to insurance loss accruals).
"Lien" means any mortgage, deed to secure debt, lien (including mechanics,
warehousemen, laborers and landlords liens), claim, pledge, charge, community
property interest, condition, equitable interest, right-of-way, easement,
encroachment, security interest, preemptive right, right of first refusal or
similar restriction or right, option, judgment, title defect or encumbrance
of any kind.
"Listed Contracts" shall have the meaning given to such term in Section
3.9(a).
"Material Adverse Effect" means, with respect to Seller, any change in or
effect on the Purchased Assets or the Business that, individually or in the
aggregate (taking into account all other such changes or effects), is, or is
reasonably likely to be, materially adverse to the Business or Purchased
Assets.
"Orders" shall have the meaning given to such term in Section 3.11.
"Party" means, Seller or Purchaser, and the term "Parties" means collectively,
Seller and Purchaser.
"PCBs" shall have the meaning given to such term in Section 3.15.
"Pension Plan" shall have the meaning given to such term in Section 3.18.
"Permits" means all permits, licenses, approvals, franchises, grants,
qualifications, rights, variances, permissive uses, accreditations,
certificates, certificates of occupancy, certifications, consents, contracts,
interim licenses, establishment registrations, product listings, easements,
identification and registration numbers, permits and other authorizations of
every nature whatsoever.
"Permitted Encumbrances" shall have the meaning given to such term in Section
3.8(a).
"Perry Equipment Lease" shall have the meaning given to such term in Section
2.1(e).
"Perry Leased Equipment" shall have the meaning given to such term in Section
2.1(e).
"Perry Leased Real Property" shall have the meaning given to such term in
Section 2.1(d).
"Perry Real Property Lease" shall have the meaning given to such term in
Section 2.1(d).
"Person" means an individual, corporation, partnership, limited partnership,
limited liability company, limited liability partnership, syndicate, person,
trust, association, entity or government or political subdivision, agency or
instrumentality of a government.
"Post-Closing Projects " shall have the meaning given to such term in Section
8.1.
"Pre-Closing Projects " shall have the meaning given to such term in Section
5.11.
"Prepaid Expenses" shall have the meaning given to such term in Section
2.1(j).
"Purchased Assets" shall have the meaning given to such term in Section 2.1.
"Purchase Price" shall have the meaning given to such term in Section 2.5(a).
"Purchaser" shall have the meaning given to such term in the preamble of this
Agreement.
"Purchaser Indemnitees" shall have the meaning given to such term in Section
9.2.
"Real Property" shall have the meaning given to such term in Section 2.1(a).
"Real Property Leases" shall have the meaning given to such term in Section
3.8(b).
"Regulated Substances" means any substance regulated under Environmental Laws,
including but not limited to hazardous waste, as defined pursuant to RCRA,
hazardous substances, as defined pursuant to CERCLA, toxic substances as
defined under TSCA, hazardous materials, as defined under the Hazardous
Materials Transportation Act, petroleum and its fractions, ACMs and PCBs.
"Representatives" means, with respect to any Party to this Agreement, such
Party's directors, officers, employees, attorneys, accountants,
representatives, consultants, independent contractors and other agents.
"Retained Liabilities" shall have the meaning given to such term in Section
2.4.
"Reviewing Parties" shall have the meaning given to such term in Section 5.5.
"Schedules" shall have the meaning given to such term in Section 5.8.
"Seller" shall have the meaning given to such term in the preamble of this
Agreement.
"Seller Benefit Plan" shall have the meaning given to such term in Section
3.18.
"Seller Indemnitees" shall have the meaning given to such term in Section 9.3.
"Seller New Matters" shall have the meaning given to such term in Section 5.8.
"Seller Other Matters" shall have the meaning given to such term in Section
5.8.
"Seller's Properties" means, with respect to the Business, any real property
or facility currently owned, leased or operated by Seller, including without
limitation, the Processing Plant and related real property, the Feed
Mill/Hatchery and related real property, the Wastewater Facility, the
Wastewater Facility Leased Real Property and the Leased Garage and related
real property.
"Subsidiary" means, with respect to Seller, any corporation, partnership,
limited partnership, limited liability company, limited liability
partnership, joint venture or other legal entity of which Seller (either
alone or through or together with any other subsidiary) owns, directly or
indirectly, a majority of the stock or other equity interests.
"Supply Agreement" means the agreement executed as of the Closing Date among
Seller and Purchaser, in the form and substance acceptable to Seller and
Purchaser, providing for Seller's short term supply of both live chickens
(▇▇▇▇-▇▇▇▇, ▇▇▇▇-▇▇▇▇ or ▇▇▇▇-▇▇▇▇▇▇▇ only) and breeder eggs (▇▇▇▇-▇▇▇▇ or
▇▇▇▇-▇▇▇▇ only), at cost, to Purchaser; such Supply Agreement to be for a
term of one (1) year with the range of supply/purchase requirements to be set
forth in a schedule attached thereto; provided, however, that with respect to
live chickens, the Supply Agreement shall only apply to the flocks listed in
the above-referenced schedule and shall terminate when the last flock listed
on such schedule is delivered to Purchaser. For purposes of such Supply
Agreement, and to be more fully described therein, "cost" shall mean Seller's
verifiable cost in accordance with GAAP. At Closing, the parties shall agree
on a reasonable estimate of the value of Seller's live inventory as of the
Closing Date and Purchaser shall pay such amount as a down payment under the
Supply Agreement (the full purchase price as set forth in the Supply
Agreement, shall be paid in connection with the delivery of the live chickens
to Purchaser, provided that Purchaser shall bear all risk of loss with
respect to any live chicken). The Supply Agreement shall also provide for
Purchaser's supply of feed to Seller.
"Tangible Personal Property" shall have the meaning given to such term in
Section 2.1(b).
"Taxes" means: (i) any and all taxes, fees, levies, duties, tariffs, imposts
and other charges of any kind, imposed by any Governmental Authority or
taxing authority, including taxes or other charges on, measured by, or with
respect to income, franchise, windfall or other profits, gross receipts,
property, sales, use, capital stock, payroll, employment, social security,
workers' compensation, unemployment compensation or net worth; taxes or other
charges in the nature of excise, withholding, ad valorem, stamp, transfer,
value-added or gains taxes; license, registration and documentation fees; and
customers' duties, tariffs and similar charges; (ii) any Liability for the
payment of any amounts of the type described in (i) as a result of being a
member of an affiliated, combined, consolidated or unitary group for any
Taxable period; (iii) any Liability for the payment of amounts of the type
described in (i) or (ii) as a result of being a transferee of, or a successor
in interest to, any Person or as a result of an express or implied obligation
to indemnify any Person; and (iv) any and all interest, penalties, additions
to tax and additional amounts imposed in connection with or with respect to
any amounts described in (i), (ii) or (iii).
"Tax Return" means any return, report, statement, form or other documentation
(including any additional or supporting material and any amendments or
supplements) filed or maintained, or required to be filed or maintained, with
respect to or in connection with the calculation, determination, assessment
or collection of any Taxes.
"Transaction Documents" means, collectively, this Agreement and each of the
other agreements and instruments to be executed and delivered by all or some
of the Parties in connection with the consummation of the Acquisition.
"Transition Services Agreement" means the agreement executed as of the Closing
Date among Seller and Purchaser, in the form and substance reasonably
acceptable to Seller and Purchaser, providing for Seller's performance, at a
reasonable cost to Purchaser, of certain reasonable transition services on
behalf of Purchaser (including the ability during the term of the Transition
Services Agreement to download certain data applicable to the Business from
Seller's systems, including payroll master data, vendor master data, and
producer master data) in connection with Purchaser's operation of the
Purchased Assets after Closing; such agreement to be for a term not to exceed
six (6) months.
"WARN Act" shall have the meaning given to such term in Section 3.17.
"Wastewater Grants" shall have the meaning given to such term in Section
3.8(i).
"Wastewater Facility" shall have the meaning given to such term in Section
2.1(f).
"Wastewater Facility Lease" shall have the meaning given to such term in
Section 2.1(f).
"Wastewater Facility Leased Assets" shall have the meaning given to such term
in Section 2.1(f).
"Wastewater Facility Leased Real Property" shall have the meaning given to
such term in Section 2.1(f).
1.2 Interpretation. Unless the context otherwise requires, the terms
defined in Section 1.1 shall have the meanings herein specified for all
purposes of this Agreement, applicable to both the singular and plural forms
of any of the terms defined herein. All accounting terms used in this
Agreement and not defined herein, shall have the meanings customarily given
thereto in accordance with GAAP. When a reference is made in this Agreement
to Sections, such reference shall be to a Section of this Agreement unless
otherwise indicated. Whenever the words "include," "includes" or "including"
are used in this Agreement, they shall be deemed to be followed by the words
"without limitation."
ARTICLE II. PURCHASE & SALE OF PURCHASED
2.1 Purchased Assets. Subject to the terms and conditions of this Agreement
and in reliance upon the representations, warranties, covenants and
agreements of Seller contained herein, at the Closing, Seller shall sell,
convey, transfer, assign and deliver to Purchaser, and Purchaser shall
purchase and acquire from Seller, free and clear of all Liens other than the
Permitted Encumbrances, all of Seller's right, title and interest in and to
all of the assets, properties and rights of Seller relating to the Business
and located at either the Processing Plant, the Feed Mill/Hatchery or the
Leased Garage of every type and description, real, personal and mixed, known
or unknown, whether or not reflected on the books and records of Seller,
except for the Excluded Assets, including, without limitation, the following
(collectively, the "Purchased Assets"):
(a) the parcel of real property and the buildings, ▇▇▇▇▇ and other
improvements located thereon, and all fixtures and other appurtenances
thereto related to the Feed Mill/Hatchery, comprising approximately 20.84
acres in Monroe County in the State of Georgia; the legal description of
which is set forth on Schedule 2.1(a) attached hereto (collectively, the
"Real Property");
(b) all of the machinery, equipment, tools, furniture, fixtures and
equipment, computer hardware, leasehold improvements, automobiles, cargo
trucks and other rolling stock, computing and telecommunications equipment
and other items of tangible personal property, of every kind owned by Seller
located at, used in the operation of or otherwise related to, the Processing
Plant, the Feed Mill/Hatchery, the Wastewater Facility and the Leased Garage
(excluding the Perry Leased Equipment and the Wastewater Facility Leased
Assets), together with any express or implied warranty by the manufacturers
or sellers or lessors of any item or component part thereof, to the extent
such warranty is transferable, and all maintenance records and other
documents relating thereto, including, without limitation, the equipment and
other items set forth on Schedule 2.1(b) (the "Tangible Personal Property");
(c) all of Seller's currently usable (i) spare parts, supplies and other
similar materials and (ii) hatching eggs, feed, grain and other feed
ingredient inventories, held for use in the Business that are not damaged,
impaired or obsolete (collectively, the "Inventory"). Inventory shall be
determined in accordance with the procedures set forth in Section 2.5(e)
herein below and shall be comprised only of such Inventory located at the
Processing Plant, the Feed Mill/Hatchery or the Leased Garage; provided,
however, that (i) without limiting the generality of the foregoing, Inventory
shall in any event include motors and tires that are not, on the Closing
Date, located at either the Processing Plant, the Feed Mill/Hatchery or the
Leased Garage because they are being repaired or recapped, respectively, at
the Leased Garage and (ii) for purposes of this Agreement, "usable" shall be
those items of Inventory on hand and listed as inventory by Seller in the
ordinary course of the Business and according to GAAP;
(d) that certain Lease Agreement (Real Property) between Development
Authority of Houston County ("DAHC") and Seller dated September 1, 1999 (the
"Perry Real Property Lease") pursuant to which Seller leases the parcel of
real property and the buildings related to the Processing Plant, comprising
of approximately 611.43 acres in Houston County in the State of Georgia, as
set forth on Schedule 2.1(d) (the "Perry Leased Real Property");
(e) that certain Lease Agreement (Equipment) between DAHC and Seller dated
September 1, 1999 (the "Perry Equipment Lease") pursuant to which Seller
leases certain machinery, equipment and other tangible personal property,
including, without limitation, the items set forth on Schedule 2.1(e) (the
"Perry Leased Equipment");
(f) that certain Lease Agreement between Seller and the City of Perry,
Georgia dated December 29, 1999 (the "Wastewater Facility Lease") pursuant to
which Seller leases that certain parcel of real property, comprising of
approximately 85.603 acres in Houston County in the State of Georgia, the
"Wastewater Facility Leased Real Property"), the buildings related to the
wastewater treatment facility located thereon (the "Wastewater Facility") and
the equipment, machinery and other tangible personal property (collectively,
the "Wastewater Facility Leased Assets"), including, without limitation, the
real property and personal property set forth on Schedule 2.1(f);
(g) all of Seller's interest in the $40,000,000 outstanding principal amount
of the Development Authority of Houston County, Taxable Revenue Bonds
(▇▇▇▇▇'▇ Inc. Project), Series 1999 (the "Bonds");
(h) the Contracts set forth on Schedule 3.9 that are specifically designated
with an asterisk (*) for assignment to and assumption by Purchaser (to the
extent set forth on Schedule 3.9(a)) (the "Assigned Contracts");
(i) all licenses, permits approvals, qualifications and orders of
governmental authorities and other public or private authorizations related
to the Purchased Assets and/or the Business, to the extent transferable;
(j) the payments (or pro rata portion thereof), if any, with respect of the
Purchased Assets or the Business, which constitute prepaid expenses in
accordance with GAAP but only to the extent listed on Schedule 2.1(j) (the
"Prepaid Expenses"); and
(k) all books, files and records related to the Purchased Assets and Assumed
Liabilities, including, but not limited to, all health and safety records as
required by the Occupational Safety and Health Act regulations as set out in
29 C.F.R. Section 1904.
2.2 Excluded Assets. Notwithstanding anything to the contrary contained in
Section 2.1 or elsewhere in this Agreement, the following assets
(collectively, the "Excluded Assets") shall not be part of the sale and
purchase contemplated hereunder, are excluded from the Purchased Assets, and
shall remain the property of Seller after the Closing:
(a) all live chickens, and breeder chickens and breeder eggs;
(b) all accounts receivable and other rights to payment from customers of
Seller or other Persons regardless of whether attributable to Seller's
operation of the Business;
(c) except for the Perry Real Property Lease, the Perry Equipment Lease, the
Wastewater Facility Lease, the Assigned Contracts, all Contracts and customer
relationships of any kind, including, without limitation, any Broiler
Production Agreements and any other Contracts with Seller's poultry
producers;
(d) all personal property and other items contained in that certain structure
located on the Real Property, known as "Building 20" (the "Building 20
Items"); such property shall, to the extent not removed prior to the Closing
Date, be separated from all other personal property and items included in the
Purchased Assets and placed in a mutually agreed upon designated area of the
Perry Leased Real Property; such Building 20 Items shall be removed from such
designated area on the Perry Leased Real Property reasonably promptly after
the Closing Date; provided, however, that Seller shall provide Purchaser with
reasonable prior notice of the time and date Seller intends to remove the
Building 20 Items;
(e) all personal property, improvements, and other items from the "tank
buildings" and the "brew house" that are to be removed as part of the Post-
Closing Projects, including, without limitation, all tanks, harvest stores,
debris and asbestos materials removed from the property in accordance with
Section 8.1 herein;
(f) cash on hand, cash equivalents, investments and bank deposits, as well as
the consideration paid to Seller pursuant to this Agreement; and
(g) all books, files and records not referred to in Section 2.1(k) above,
including, without limitation, books, files and records related to the
Retained Liabilities and any and all human resources or other employee files
and records.
2.3 Assumed Liabilities. Upon and subject to the terms, conditions,
representations and warranties of Seller contained herein, in accordance with
the terms and conditions of the Bond Assignment and Assumption Agreement and
the Assignment and Assumption Agreement, and subject to Section 2.4,
Purchaser hereby assumes and agrees to pay, perform, and discharge when due,
only the Liabilities of Seller under the Perry Real Property Lease, the Perry
Equipment Lease, the Wastewater Facility Lease and the Assigned Contracts
that, by the terms of such Contracts, arise or otherwise accrue after the
Closing Date, relate to periods following the Closing Date and are to be
observed, paid, performed or discharged, as the case may be, in each case at
any time after the Closing Date (collectively referred to hereinafter as the
"Assumed Liabilities"). Except for the Assumed Liabilities, Seller shall
transfer the Purchased Assets to Purchaser on the Closing Date free and clear
of all Liens (other than Permitted Encumbrances) and all Liabilities.
2.4 Retained Liabilities. Except for the Assumed Liabilities, Purchaser
shall not assume or in anyway be responsible for, and shall have no Liability
for, any Liabilities, Taxes or Contracts of Seller of any kind, character or
description, whether accrued, absolute, contingent or otherwise, it being
understood that Purchaser is expressly disclaiming any express or implied
assumption of any Liabilities other than the Assumed Liabilities. Without
limiting the generality of the foregoing, Purchaser shall not assume, and
Seller shall remain exclusively liable for any Liability that is not an
Assumed Liability, including, without limitation: (i) any Liability under the
Perry Real Property Lease, the Perry Equipment Lease, the Wastewater Facility
Lease or any Assigned Contract which arises out of or relates to a breach of
such Contract occurring or otherwise accruing prior to the Closing Date, (ii)
any accounts or trade payables, or any other financial obligations of Seller
or the Business whatsoever not included with the Assumed Liabilities, (iii)
any Liability arising out of any Claims, including, without limitation, any
employment matters or any other Claims set forth in the Disclosure Schedules,
including, without limitation, the Claims listed in Schedules 3.11 and 3.12,
and (iv) any Liability not included with the Assumed Liabilities arising out
of any Claims commenced after the Closing and arising out of, or relating to,
any occurrence or event (including, without limitation, employment matters)
occurring prior to the Closing Date (collectively, the "Retained
Liabilities").
2.5 Purchase Price; Payment of Purchase Price.
(a) The aggregate consideration for the Purchased Assets shall be as follows
(collectively, the "Purchase Price"):
(i) Forty Four Million Dollars ($44,000,000.00);
(ii) the Inventory Purchase Price;
(iii) a Contingent Purchase Price of One Million Dollars ($1,000,000.00),
subject to (A) Section 2.5(d) and (B) any earlier payment thereof as set
forth in Schedule 8.1; and
(iv) the assumption of the Assumed Liabilities.
(b) At the Closing, the $44,000,000.00 referenced in (a)(i) above and the
Inventory Purchase Price shall be paid via wire transfer of immediately
available funds from Purchaser to an account of Seller (such account to be
specified by Seller to Purchaser no less than three Business Days prior to
the Closing). The Inventory Purchase Price shall be determined in accordance
with Section 2.5(e) below.
(c) At the Closing the Seller shall assign, and Purchaser shall assume, the
Assumed Liabilities by executing an Assignment and Assumption Agreement, in
form and substance reasonably acceptable to Seller and Purchaser (the
"Assignment and Assumption Agreement"). Additionally, at the Closing, Seller
shall assign to Purchaser and Purchaser shall assume from Seller all of
Seller's interests in and obligations under the Bonds and other Bond
Documents arising on and after the Closing Date, by executing an assignment
and assumption agreement in substantially the form as approved by the DAHC on
January 8, 2004 (the "Bond Assignment and Assumption Agreement").
(d) Except with respect to earlier payments of portions of the Contingent
Purchase Price as provided in Schedule 8.1, the Contingent Purchase Price
shall be paid via wire transfer upon the satisfactory completion of the Post
-Closing Projects, provided that in the event that the Post-Closing Projects
have not been completed within 12 months after the Closing Date, the
Contingent Purchase Price to be paid to Seller upon completion of the Post
-Closing Projects shall be reduced by such amount that is 1/180th of the
Contingent Purchase Price or $5,556.00 per day for each day after the first
anniversary of the Closing Date that the Post-Closing Projects are not
completed in accordance with the terms of this Agreement.
(e) Commencing on the second business day prior to the Closing Date (the
"Inventory Date"), representatives of Seller and Purchaser shall jointly
conduct a physical inventory, in a manner to be agreed upon by the Parties,
of the Inventory on hand on and as of the Inventory Date; and Purchaser shall
prepare a list identifying and describing all items included within the
Inventory which Purchaser believes are obsolete, damaged or impaired. The
parties shall mutually agree upon which items are so obsolete, damaged or
impaired and shall remove such items from the Inventory listing (the list as
so agreed upon and valued as set forth below, is hereinafter referred to as
the "Inventory Date Statement"). The Inventory (including goods which have
been ordered and paid for by Seller which are in transit or which have not
yet been shipped by the vendor thereof) shall be valued at Seller's
"Inventory Cost," which for any item of Inventory, shall be Seller's
verifiable cost (except for used or rebuilt equipment which shall be valued
at fair market value as mutually agreed upon by the parties) determined in
accordance with GAAP for such item as of 4:00 p.m. on the second day prior to
the Closing Date. The Inventory Cost per unit for each such item shall be
given by Seller to Purchaser not later than 5:00 p.m. on the second day prior
to the Closing Date, and Seller shall afford Purchaser immediate access to
Seller's books and records to permit Purchaser to verify such Inventory
Costs. (The aggregate of the values of the various items of Inventory sold
by Seller to Purchaser on the Closing Date shall be herein referred to as the
"Inventory Purchase Price".) The Inventory Purchase Price shall be stated on
the Inventory Date Statement, which shall be agreed upon and executed by
Seller and Purchaser at or prior to Closing. If Seller and Purchaser are
unable to agree upon either (i) an Inventory Cost for any item of Inventory
or (ii) the Inventory Purchase Price by the Closing Date, Seller and
Purchaser shall agree upon a reasonable estimate of the Inventory Purchase
Price and such amount shall be paid to Seller by Purchaser at the Closing.
Immediately following the Closing, Seller and Purchaser shall cooperate in
good faith to attempt to agree upon a final Inventory Purchase Price. Upon
reaching such agreement, either Seller will pay Purchaser, or Purchaser will
pay Seller, as the case may be, the difference between such final Inventory
Purchase Price and the Inventory Purchase Price estimated and paid at
Closing. If Seller and Purchaser are unable to, within 14 days after the
Closing Date, to agree upon such a final Inventory Purchaser Price, the
actual final Inventory Purchase Price shall be determined by Ernst & Young
LLP (the "Designated Accountant"), whose determination with respect to the
matters in question shall be final, conclusive and binding upon each of the
parties hereto. Purchaser and Seller shall share the fees and expenses of
the Designated Accountant equally.
(f) At the Closing, all of the real estate and personal property Taxes and
assessments applicable to the Purchased Assets shall be prorated based on the
most recently ascertainable real estate and personal Tax ▇▇▇▇, with Seller
being responsible for amounts due for any period prior to Closing. In
addition, at the Closing, the Parties shall prorate each Prepaid Expense
based upon the number of days that each Party will receive the benefit of
such Prepaid Expense. For purposes of calculating such prorations, Purchaser
shall be deemed in title to the Purchased Assets for the entire day of the
Closing Date.
2.6 Allocation of Purchase Price. Prior to the Closing, Purchaser and Seller
shall agree as to the allocation of the Purchase Price pursuant to Section
1060 of the Code and the treasury regulations promulgated thereunder;
provided, however, that Purchaser and Seller agree that the portion of the
Purchase Price allocated to Inventory, shall be equivalent to the Inventory
Purchase Price as determined in Section 2.5(e). Purchaser and Seller agree
to reflect such allocation on IRS Form 8594: Asset Acquisition Statement
under Section 1060, including any required amendments or supplements thereto
("Form 8594"), in form and substance reasonably acceptable to Seller and
Purchaser. Form 8594 shall be prepared jointly by Purchaser and Seller and
shall be signed by the Parties on the Closing Date. The Parties hereto
further agree that: (a) the agreed upon allocation of Purchase Price shall be
used in filing all required forms under Section 1060 of the Code and all Tax
Returns; and (b) they will not take any position inconsistent with such
allocation upon any examination of any such Tax Return, in any refund claim
or in any tax litigation.
2.7 Closing. The consummation of the purchase and sale of the Purchased
Assets in accordance with this Agreement (the "Closing") shall take place at
10:00 a.m., local time, at the offices of ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇ LLP,
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇, or such other place and time
as the Parties may agree, on the later to occur of: (a) January 30, 2004; or
(b) the third Business Day after all of the conditions precedent to Closing
hereunder shall have been satisfied or waived, or at such other time and
place as the Parties shall agree in writing. The date of the Closing shall
be referred to as the "Closing Date." The Parties hereby agree to deliver at
the Closing such documents, certificates of officers and other instruments as
are set forth in Article VI hereof and as may reasonably be required to
effect the transfer by Seller of the Purchased Assets pursuant to and as
contemplated by this Agreement and to consummate the Acquisition. All events
which shall occur at the Closing shall be deemed to occur simultaneously and
be effective as of 11:59 p.m. on the Closing Date.
ARTICLE III. REPRESENTATIONS AND WARRANTIES OF SELLER.
As an inducement to Purchaser to enter into this Agreement and to consummate
the Acquisition, each Seller, jointly and severally, represents and warrants
to Purchaser that each of the following representations and warranties is
true and correct as of the date hereof and will be true and correct on and as
of the Closing Date:
3.1 Organization and Qualification.
Each Seller is a corporation duly organized, validly existing and in good
standing under the laws of the State of Georgia and has all requisite power
and authority, corporate or otherwise, to own, lease and operate its
properties and to carry on the Business as it is now being conducted. Seller
is duly qualified or licensed to do business, and is in good standing, in
each jurisdiction where, with respect to the Business, the character of the
properties owned, leased or operated by it or the nature of its activities
makes such qualification or licensing necessary, except when failure to be so
qualified or licensed would not have a Material Adverse Effect.
3.2 Articles of Incorporation and By-laws. The copies of Seller's articles
of incorporation and by-laws previously provided to Purchaser by Seller are
true, complete and correct copies thereof. Such articles of incorporation
and by-laws are in full force and effect. Seller is not in violation of any
of the provisions of its articles of incorporation or by-laws.
3.3 Authority Relative to this Agreement. Seller has all necessary corporate
power and authority to execute and deliver this Agreement and the other
Transaction Documents to which it is a party, to perform its obligations
hereunder and thereunder and to consummate the Acquisition. The execution
and delivery of this Agreement and the other Transaction Documents by Seller
and the consummation by Seller of the Acquisition have been duly and validly
authorized by all necessary corporate action on the part of Seller, and no
other corporate proceedings on the part of Seller are necessary to authorize
this Agreement or to consummate the Acquisition. This Agreement and the
other Transaction Documents have been or will be duly executed and delivered
by Seller and, assuming the due authorization, execution and delivery by the
other Parties hereto, each such agreement constitutes a legal, valid and
binding obligation of Seller, enforceable against Seller in accordance with
its terms, subject to the effect of any applicable bankruptcy, moratorium,
insolvency, reorganization or other similar law affecting the enforceability
of creditors' rights generally and to the effect of general principles of
equity which may limit the availability of remedies (whether in a proceeding
at Law or in equity) (the "Bankruptcy Exception").
3.4 No Conflict . Except as set forth on Schedule 3.4, the
execution and delivery of this Agreement by Seller do not, and the
performance by Seller of its obligations hereunder and the consummation of
the Acquisition will not: (a) conflict with or violate any provision of the
articles of incorporation or by-laws of Seller or any resolutions adopted by
the board of directors of Seller; (b) assuming that all filings and
notifications described in Section 3.5 have been made, conflict with or
violate any Law or Order applicable to Seller or by which any of the
Purchased Assets or Seller is bound or affected; or (c) result in any breach
of or constitute a material default (or an event which with the giving of
notice or lapse of time or both could reasonably be expected to become a
default) under, or give to others any right of termination, amendment,
acceleration or cancellation of, or result in the creation of a Lien on any
of the Purchased Assets or Seller pursuant to, any material note, bond,
mortgage, indenture, Contract, license, permit, franchise or other instrument
or obligation.
3.5 Required Filings and Consents. The execution and delivery of this
Agreement by Seller do not, and the performance by Seller of its obligations
hereunder and the consummation of the Acquisition will not, require any
consent, approval, authorization or permit of, or filing by Seller with or
notification by Seller to, any Governmental Authority, except for (a) the
consents, approvals, authorizations, declarations or rulings set forth on
Schedule 3.5, (b) the filing of a Notification and Report Form pursuant to
the HSR Act, and the expiration or earlier termination of the applicable
waiting period thereunder with respect to the Acquisition and (c) as required
in connection with the Bond Encumbrances as described herein.
3.6 Inventory. Except as set forth on Schedule 3.6, Seller has good and
marketable title to the Inventory free and clear of all Liens. The Inventory
is in good and merchantable condition, is salable, suitable and usable for
the purposes for which it is intended and is in a condition such that it can
be used in the ordinary course of the Business consistent with past practice.
3.7 Absence of Certain Changes or Events. Since November 19, 2003, except as
contemplated by this Agreement or disclosed on Schedule 3.7 or any other
Schedule hereto, Seller has conducted the Business in the ordinary course
consistent with past practice and there has not been:
(a) Any event, occurrence or circumstance that could reasonably be expected
to cause a Material Adverse Effect on the Purchased Assets or the Business
conducted with such Assets;
(b) Any event that could reasonably be expected to prevent or materially
delay the performance of Seller's obligations pursuant to this Agreement
and/or the consummation of the Acquisition;
(c) Any cannibalization, relocation or other transfer or movement of any
Purchased Asset or any part of a Purchased Asset;
(d) Any damage, destruction or other casualty loss (whether or not covered by
insurance), condemnation or other taking affecting the Purchased Assets;
(e) Any incurrence of any material Liability (absolute or contingent) in
respect to the Business, except for current Liabilities incurred in the
ordinary course of the Business consistent with past practice;
(f) Any transaction with respect to the purchase, acquisition, lease, sale,
disposition or transfer of any Purchased Assets or to any capital expenditure
(in each case, other than in the ordinary course of the Business) or creation
of any Lien on any of the Purchased Assets;
(g) Any purchases of Inventory other than in the ordinary course of the
Business consistent with past practice and any material change in the nature,
level and condition of the Inventory;
(h) Any write-downs or write-ups (or failures to write down or write up in
accordance with GAAP) of the value of any Inventory other than in the
ordinary course of the Business consistent with past practice and in
accordance with GAAP;
(i) Any failure to maintain the Purchased Assets in the condition they were
in on November 19, 2003, ordinary wear and tear excepted, except for the
Purchased Assets listed on Schedule 5.11 which are subject to the provisions
of Section 5.11;
(j) Any material modification, termination, waiver, amendment or other
alteration or change in the terms or provisions of any Contract or Permit;
(k) Any significant personnel changes or employee turnover with respect to
the Business;
(l) Any adverse change in Seller's relations with its suppliers or
independent contractors that could reasonably be expected to have a Material
Adverse Effect upon the Business;
(m) Any discharge or satisfaction of any Lien, or payment of any material
liabilities, other than in the ordinary course of the Business consistent
with past practice, or failure to pay or discharge when due any Liabilities,
the failure to pay or discharge of which has caused or will cause a Material
Adverse Effect;
(n) Other than actions taken by or with the consent of Purchaser, neither any
modification, termination, waiver, amendment or other alteration or change in
the terms or provisions of the Bonds nor any event, occurrence or
circumstance that could reasonably be expected to prevent the Seller from
transferring the Processing Plant and the Feed Mill/Hatchery subject to the
Bond Encumbrances or challenging the enforceability of the Bonds and the
treatment, for purposes of state and local taxes, of the Processing Plant and
the Feed Mill/Hatchery as a result of each being subject to the Bond
Encumbrances; or
(o) Any Contract by Seller to do any of the foregoing.
3.8 Properties; Title.
(a) Seller has good and marketable title in fee simple title to all of the
Real Property, free and clear of any Liens, except for the following
(collectively, "Permitted Encumbrances"): (i) the matters and exceptions set
forth on Schedule 3.8(a)(i); (ii) the state of facts shown on the surveys
listed on Schedule 3.8(a)(ii), as of the date of such surveys so listed and
(iii) routine title imperfections and exceptions which will not materially
interfere with the intended use of such property. None of the improvements
erected on the Real Property encroach on adjoining property. To Seller's
Knowledge, none of the properties constituting the Real Property are located
in a flood zone as defined by the Federal Insurance Administration. No
proceeding is pending or, to Seller's Knowledge, threatened for the taking or
condemnation of all or any portion of the Real Property. The Real Property
is all of the real property owned by Seller and used in the Business. No
Person other than Seller has any oral or written right to lease, sublease or
otherwise occupy any portion of the Real Property. Schedule 3.8(a)(iii) sets
forth a list of all title insurance policies, deeds, appraisal reports,
surveys and environmental reports held or controlled by Seller with respect
to the Real Property and the real property leased pursuant to the Real
Property Leases, true and complete copies of which have been provided to
Purchaser. All Taxes with respect to the Real Property have been paid in
full.
(b) The Perry Real Property Lease, the Wastewater Facility Lease and the
Garage Lease, together with any other leasehold estates described on Schedule
3.8(b)(i), are all of the leasehold estates under which Seller is a lessee
(or sublessee) of any real property or interest therein in respect of this
Business (collectively, the "Real Property Leases"). The Real Property
Leases are valid, in full force and effect and enforceable against the
landlord thereunder in accordance with their terms and have not been modified
or amended. Neither Seller, as tenant thereunder, nor to Seller's Knowledge,
is the landlord, in default with respect to the performance or observance of
any of their respective covenants or obligations under the terms of any Real
Property Leases, nor has any event occurred with which the giving of notice
or the passage of time would constitute such a default. No proceeding is
pending or, to Seller's Knowledge, threatened for the taking or condemnation
of all or any portion of the property demised under the Real Property Leases.
Seller owns good and marketable title to its leasehold estates created
pursuant to the Real Property Leases, free and clear of any Liens, other than
any encumbrances set forth in the Bond Documents or otherwise in connection
with security for the Bonds, as set forth on Schedule 3.8(b)(i) (the "Bond
Encumbrances") except for: (i) real property Taxes, if any affecting
properties of which the premises demised under the Real Property Leases form
a part, not yet due and payable; and (ii) the matters and exceptions set
forth on Schedule 3.8(b)(ii). There is no brokerage commission or finder's
fee due from Seller and unpaid with regard to any of the Real Property
Leases, or which will become due at any time in the future with regard to any
Real Property Lease. In the event that there is a separation in title from
land and improvements so that Seller holds a leasehold estate in land and fee
title to the related improvements, the provisions of this Section 3.8(b)
shall apply to such leasehold estate in land and the provisions of Section
3.8(a) shall apply to such related improvements. The real property that is
the subject of the Real Property Leases is all of the real property leased by
Seller and used in the Business other than facilities of Seller not included
in the Purchased Assets. The real property leased pursuant to the Real
Property Leases and the Real Property constitute all of the real property
used in the Business other than facilities of Seller not included in the
Purchased Assets.
(c) Except as set forth on Schedule 3.8(c), there are no unrecorded
covenants, deed restrictions, easements, leases, subleases or rights of
occupancy or Liens which encumber the Real Property, or any part thereof, any
of the Real Property Leases or any of the properties demised under the Real
Property Leases.
(d) Except as set forth on Schedule 3.8(d), there are no easements, rights of
way or licenses which are not in full force and effect necessary for the
operation of the Business on any of the parcels constituting the Real
Property or the premises demised under the Real Property Leases and all such
easements, rights of way and licenses set forth on Schedule 3.8(d) are in
full force and effect.
(e) Except as set forth on Schedule 3.8(e), to Seller's Knowledge, the Real
Property and the premises demised under the Real Property Leases, including,
without limitation, the walls, ceilings and other structural elements of any
improvements erected thereon and the building systems thereof (including the
heating, plumbing, ventilation, air conditioning and electric systems), are
adequate and sufficient for the current operations of the Business, and such
improvements are in the condition they were on November 19, 2003, ordinary
wear and tear excepted. To Seller's Knowledge, except as set forth on
Schedule 3.8(e), such properties and improvements are free of structural
defects, other than minimal structural defects which do not affect the value
or use of such improvements. Except as set forth on Schedule 3.15, to
Seller's Knowledge, the Real Property, including all of the structures and
buildings located on the Real Property and the use of the Real Property in
the operation of the Business complies with and are not in violation of any
building, zoning, anti-pollution, health, occupational safety or other Laws
or any Order or Permit applicable thereto; and Seller has received no written
notice of any such non-compliance or violation which has not been corrected
or cured.
(f) Seller has the right of ingress and egress, through a public road or
street, to and from each of the parcels comprising the Real Property and each
of the properties demised under the Real Property Leases. No utility
easement or right of way which services any portion of the Real Property or
any of the properties demised under the Real Property Leases may be
terminated by the owner or mortgagee of any property through which any such
easement or right of way runs.
(g) The Perry Leased Real Property, the Perry Leased Equipment, the
Wastewater Facility Leased Real Property, the Wastewater Facility Leased
Assets and the Leased Garage are leased to Seller pursuant to the terms of
the Perry Real Property Lease, the Perry Equipment Lease, the Wastewater
Facility Lease and the Garage Lease. To Seller's Knowledge, the DAHC owns
the Perry Leased Real Property and the Perry Leased Equipment and the City of
Perry, Georgia owns the Wastewater Facility Leased Real Property and the
Wastewater Facility Leased Assets, in each case, free and clear of any Liens
other than the liens and encumbrances created pursuant to the Bond Documents.
The Perry Real Property Lease, the Perry Equipment Lease and the Wastewater
Facility Lease each provide that the lessee thereunder has the right to
purchase the Perry Leased Real Property, the Perry Leased Equipment and the
Wastewater Facility Leased Assets and Wastewater Facility Leased Real
Property, respectively, from the lessor thereunder prior to the expiration of
the term thereof by (i) providing for the prepayment in full of the Bonds and
(ii) in the case of the Perry Leased Real Property and the Perry Leased
Equipment, each for $10.00 payable by Purchaser to DAHC, and in the cases of
the Wastewater Facility Leased Real Property and the Wastewater Facility
Leased Equipment, without additional cost to, or consideration by, the lessee
thereunder. Seller has, and to Seller's Knowledge, Purchaser will have, the
right to use the Perry Leased Real Property and the Perry Leased Equipment
and the Wastewater Facility Leased Real Property and the Wastewater Facility
Leased Assets without restriction or interference from DAHC or the City of
Perry, Georgia or any party related thereto except as specifically provided
in the Perry Real Property Lease, the Perry Equipment Lease and the
Wastewater Facility Lease.
(h) Since the date of the survey entitled "ALTA/ALSM Land Title Survey for
▇▇▇▇▇'▇, Inc.", prepared by ▇▇▇▇▇▇▇▇ & Associates, dated November 8, 2000
with respect to the Real Property, Seller has not made or caused to be made
or allowed to be made any additions or alterations of or to improvements on
the Real Property which would be disclosed by a survey prepared as of the
date hereof, other than certain silos, rail facilities to support such silos
and other related structures erected on the Real Property since said date,
which are within the boundary lines of the Real Property and which do not
affect any easement or right of way. Since the date of said survey, Seller
has not granted any easements or rights of way nor allowed the alteration or
installation of any utility facilities which would be disclosed by a survey
prepared as of the date hereof. With respect to any property adjoining the
Real Property, Seller has no knowledge of any additions, alterations or
changes since the date of said survey which affect the Real Property and
would be disclosed by a survey prepared as of the date hereof.
(i) Seller has complied with all of the requirements applicable to Seller
with respect to that certain Georgia Community Development Block Grant,
Regional Economic Business Assistance Grant and Employment Incentive Program
Grant made available to Seller and/or the City of Perry, Georgia with
Respect to the Wastewater Facility (the "Wastewater Grants"), and to
Seller's Knowledge, Purchaser will have no further obligations pursuant to
the Wastewater Grants after the Closing.
3.9 Contracts.
(a) Schedule 3.9(a) sets forth a list of all Contracts to which Seller is a
party related to the Purchased Assets or the Business as of the date hereof
(collectively, the "Listed Contracts"), including, without limitation.
(i) any continuing Contract for services of independent contractors (including
chicken catchers), the purchase of Inventory, materials, supplies, equipment
or services;
(ii) any Contract for capital expenditures;
(iii) any Contract pursuant to which Seller is a lessor of any Tangible
Personal Property;
(iv) any Contract by and between Seller and a poultry producer or grower, as
such terms are understood in the poultry processing industry, in connection
with the Business;
(v) any Contract or agreement to which Seller is the licensee of any software
or other intellectual property used in or necessary for the Business (other
than commonly used off-the-shelf software such as Microsoft Windows and
similar base computer operating programs not specifically created for or
related to the Business); and
(vi) any Contract or agreement which is otherwise material and is not
described in any of the categories specified in this Section 3.9(a).
(b) Seller has performed all of the obligations required to be performed by
it (including any lease payments due on or before the Closing Date) and is
entitled to all benefits under, and is not alleged to be in default in
respect of any Assigned Contract. Each of the Assigned Contracts is valid
and binding and in full force and effect, and except as disclosed on Schedule
3.9(b), there exists no default or event of default or event, occurrence,
condition or act, with respect to Seller, or to Seller's Knowledge, with
respect to the other contracting party, which, with the giving of notice, the
lapse of the time or the happening of any other event or conditions, would
become a default or event of default under any Assigned Contract. Seller has
not received written or oral notice of cancellation, modification or
termination of any Assigned Contract. To Seller's Knowledge, none of the
parties to any Assigned Contract intends to terminate or alter the provisions
thereof by reason of the Acquisition or otherwise. Except as set forth on
Schedule 3.9(b), Seller has not waived any right under any Assigned Contract,
amended or extended any Assigned Contract or failed to renew (or received
notice of termination or failure to renew with respect to) any Assigned
Contract. True, correct and complete copies of all Assigned Contracts have
been delivered to Purchaser. Each item or machinery or equipment leased by
Seller under any Assigned Contract is in the condition that it was in on
November 19, 2003, ordinary wear and tear excepted.
3.10 Permits. Seller has obtained all Permits and all Environmental Permits
of, and has made all required registrations and filings with, any
Governmental Authorities that are required for the conduct of the Business as
it is now being conducted. All Permits and Environmental Permits that are
required for the conduct of the Business are listed on Schedule 3.10 and are
in full force and effect. Except as set forth on Schedule 3.10, none of the
Permits or Environmental Permits has been suspended or cancelled nor is any
such suspension or cancellation pending or, to Seller's Knowledge,
threatened. None of the Permits or Environmental Permits will terminate by
reason of the Acquisition. Seller is not in conflict in any respect with or
in default or violation of, any Permits or Environmental Permits. Schedule
3.10 sets forth, as of the date of this Agreement, all actions, proceedings,
investigations or surveys pending or, to Seller's Knowledge, threatened
against Seller that could reasonably be expected to result in the suspension
or cancellation of any Permit or Environmental Permit.
3.11 Compliance with Laws. Except as set forth on Schedule 3.11, Seller is
not in conflict in any respect with or in default or violation of any: (a)
order, judgment, preliminary or permanent injunction, temporary restraining
order, award, citation, decree, consent decree or writ (collectively,
"Orders") of any Governmental Authority; or (b) Laws of any Governmental
Authority, affecting or relating to the Purchased Assets or the Business.
Except as set forth on Schedule 3.11, Seller has not received from any
Governmental Authority any written notification with respect to possible
conflicts, defaults or violations of Laws.
3.12 Claims and Proceedings. Except as set
forth on Schedule 3.12, there is no outstanding Order of any Governmental
Authority or division thereof (including, but not limited to, the Equal
Opportunity Commission, Department of Labor or Office of Federal Contract
Compliance Programs) whether statutory, common law or otherwise, against or
involving Seller with respect to the Purchased Assets or the Business.
Except as set forth on Schedule 3.12, there is (i) no action, suit, claim or
counterclaim or legal, administrative or arbitral proceeding or investigation
(collectively, "Claim") (whether or not the defense thereof or Liabilities in
respect thereof are covered by insurance), pending or, to Seller's Knowledge,
threatened against or involving Seller with respect to the Purchased Assets
or the Business including employment related Claims or (ii) no pending unfair
labor practice charges against Seller with respect to the Business, no
demands for recognition, whether by way of petition filed with the National
Labor Relations Board or otherwise, and to Seller's Knowledge, no other
effort of or request or demand from a labor organization for representative
status with respect to any person employed by Seller with respect to the
Business or otherwise used in the Business. There exists on the date hereof,
and there will exist as of the Closing, no fact, event or circumstance Known
to Seller that would give rise to any Claim that, if pending or threatened on
the date hereof or on the Closing Date, could reasonably be expected to have
a Material Adverse Effect. There are no Claims pending or, to Seller's
Knowledge, threatened that would give rise to any right of indemnification on
the part of any director or officer of Seller or the heirs, executors or
administrators of such director or officer, against Seller.
3.13 Books and Records. All books of account and other financial books and
records of Seller directly relating to the Purchased Assets (the "Books and
Records") are true, correct and complete and have been made available to
Purchaser. All of the Books and Records have been prepared and maintained in
accordance with good business practices and, where applicable, in conformity
with GAAP and in compliance with all Laws. Except as set forth on Schedule
3.13, there are no material inaccuracies or discrepancies contained or
reflected in the Books and Records.
3.14 No Finder. Except as set forth on Schedule 3.14, neither Seller nor any
Person acting on behalf of Seller has agreed to pay to any broker, finder,
investment banker or any other Person, a brokerage, finder's or other fee or
commission in connection with this Agreement or any matter related hereto,
nor has any broker, finder, investment banker or any other Person taken any
action on which a Claim for any such payment could be based. Seller shall be
solely responsible for paying any and all fees, commissions or other
compensation to which any party disclosed on Schedule 3.14 is entitled or
claims on account of the Acquisition.
3.15 Environmental Matters. For purposes of this Section 3.15 only, "Seller"
includes any Affiliates of Seller. Except as set forth on Schedule 3.15, (i)
Seller has not released, emitted, buried or otherwise disposed of any
Regulated Substances on Seller's Properties except as is customary in poultry
operations of the kind engaged in on Seller's Properties and in compliance
with applicable law, (ii) Seller has complied with all Environmental Laws
relating to the operation of Seller's Properties, (iii) Seller has not
received any notice, demand, Claim or information request pursuant to the
Comprehensive Environmental Response, Compensation and Liability Act
("CERCLA") or any comparable state Law, (iv) none of Seller's Properties is
listed on any regulatory list of contaminated properties, including but not
limited to the National Priorities List promulgated pursuant to CERCLA, the
CERCLIS or any federal, state or local counterpart, (v) Seller is not
required to have, nor does it have, any Permits issued under any
Environmental Laws; there is an assured supply of water to meet the needs of
the Business as it is currently being conducted; and (vi) Seller has not
received any communications from any environmental regulator that indicate
that conditions on any Environmental Permits will become more stringent upon
renewal, transfer or as a result of a permit amendment. To Seller's
Knowledge, except as set forth on Schedule 3.15, (i) no one other than Seller
has released, emitted, buried or otherwise disposed of Regulated Substances
on Seller's Properties, (ii) no one other than Seller has received any
notice, demand, Claim or information request pursuant to CERCLA or any
comparable state Law regarding the Seller's Properties, (iii) no underground
storage tanks are or have been located on any of Seller's Properties, (iv)
there are no asbestos containing materials ("ACMs"), polychlorinated
biphenyls ("PCBs") or radioactive substances located on Seller's Properties,
and (v) there are no conditions on any properties adjacent to Seller's
Properties which threaten property owned or leased by Seller.
3.16 Insurance; Fidelity Bonds. Schedule 3.16 sets forth a list of all
insurance policies, fidelity and surety bonds and fiduciary liability
policies (collectively, the "Insurance Policies") covering the Purchased
Assets and the Business. All Insurance Policies are in full force and
effect.
3.17 Employee Matters. Schedule 3.17 lists the names of all salaried
employees and agents of Seller engaged at the Processing Plant and the Feed
Mill/Hatchery in the conduct of the Business, together with their respective
rates of total compensation and indicates which of such individuals were, as
of the date set forth on Schedule 3.17, on disability leave, authorized leave
of absence, military service, or any other type of leave of absence,
authorized or otherwise. Seller has, with respect to such employees,
complied with all pertinent legal requirements relating to the employment of
labor, including the Worker Adjustment and Retraining Notification Act, 29
U.S.C. - 2101 et seq. ("WARN Act"), ERISA, notice and continuation coverage
requirements with respect to group health plans as required by Code Section
4980B or ERISA Sections 601 through 608 ("COBRA"), and related applicable
state Legal Requirements, the applicable requirements of the Health Insurance
Portability and Accountability Act of 1996, and those legal requirements
relating to wages, hours, collective bargaining, unemployment insurance,
leaves of absence, workers' compensation, military service, immigration
control, the payment and withholding of employment Taxes, and equal
employment opportunity, including the maintenance of a work environment in
which no harassment, discrimination, or disparate treatment occurs with
regard to any condition of employment, including recruiting, hiring,
promotion, compensation, benefits, and training. Seller has paid, and shall
pay in the ordinary course of the Business, in full to its employees, agents
and contractors all wages, salaries, commissions, bonuses and other direct
compensation for all services performed by them. Seller is, and shall
remain, responsible for any vacation pay or severance pay or other payments
payable on account of Seller's termination of any of its employees.
3.18 Employee Benefit Plans.
(a) As used herein, the term "Benefit Plan" includes any pension, retirement,
savings, disability, medical, dental, health, life, death benefit, group
insurance, profit sharing, deferred compensation, stock option, bonus,
incentive, vacation pay, tuition reimbursement, severance pay, or other
employee benefit plan, trust, agreement, contract, policy or commitment
(including, without limitation, any pension plan, as defined in Section 3(2)
of the Employee Retirement Income Security Act of 1974, as amended and the
rules and regulations promulgated thereunder ("ERISA") ("Pension Plan"), and
any welfare plan as defined in Section 3(1) of ERISA), whether any of the
foregoing is funded, insured or self-funded, written or oral, (i) sponsored
or maintained by Seller, or any of Seller's affiliates, to the extent such
affiliate is described in Code Section 414(b), (c) or (m) and corresponding
Treasury Regulations (each a "Controlled Group Member") and covering Seller's
or any Controlled Group Member's active or former employees, directors or
consultants (or their beneficiaries) of the Business, (ii) to which Seller or
any Controlled Group Member is a party or by which any Controlled Group
Member (or any of the rights, properties or assets thereof) is bound in
respect of the Business, or (iii) with respect to which Seller or any
Controlled Group Member has made any payments, contributions or commitments
or may otherwise have any liability (whether or not Seller or such Controlled
Group Member still maintains such Benefit Plan) in respect of the Business.
Each Benefit Plan of Seller that is applicable to employees of the Business
located at the Processing Plant or the Feed Mill/Hatchery is listed on
Schedule 3.18 (each such Plan is hereinafter referred to as a "Seller Benefit
Plan"). Seller has delivered to Purchaser copies of each such Seller Benefit
Plan and, to the extent applicable, any summary plan descriptions and summary
of material modification and a copy of the most recent determination letter
issued by the IRS with respect to any such Seller Benefit Plan intended to be
qualified under section 401(a) of the Code.
(b) No event has occurred in connection with any Seller Benefit Plan that
has, will or may result in any fine, penalty, or other Liability for which
any transferee of assets of Seller may be responsible, whether by operation
of Law or by contract, nor will the consummation of the transactions
contemplated under this Agreement result in any such fine, penalty, or other
Liability. The transactions contemplated by this Agreement will not, either
alone or in combination with any other event or events, cause Purchaser to
incur any Liabilities with respect to any Seller Benefit Plan, including,
without limitation, (i) any Liability under Section 4980B of the Code, or
(ii) any Liability with respect to any employee, director or consultant of
Seller that was incurred or arose on or prior to the Closing Date.
(c) Except as disclosed on Schedule 3.18(c), neither Seller nor any
Controlled Group Member sponsors, maintains or otherwise contributes to or
has any liability with respect to any Pension Plan which is or was subject to
Title IV of ERISA, including any "multi-employer plan" (as defined in Section
4001(a)(3) of ERISA), or subject to Section 412 of the Code.
(d) Seller does not have any Liability under any Seller Benefit Plan or any
multi employer benefit plan that would (i) result in the imposition of a Lien
on any of the Purchased Assets on or after the Closing Date, (ii) affect
adversely Purchaser's right, title or interest in or to the Purchased Assets
on or after the Closing Date or (iii) result in the assumption by, or
imposition on, either the Purchased Assets or Purchaser of any Liability with
respect to any Seller Benefit Plan on or after the Closing Date. Seller
further represents that Seller does not have any liability for any unpaid
contributions or withdrawals arising out of any multi employer benefit plan
relating to the Business.
3.19 Purchased Assets.
(a) Seller owns good and marketable title to all of the Purchased Assets.
Except as disclosed in Schedule 3.19, the Purchased Assets are free and clear
of all restrictions on or conditions to transfer or assignment. Seller has
the power and right to transfer, sell, assign, convey and deliver the
Purchased Assets to Purchaser in accordance with the terms hereof, and upon
consummation of the transactions contemplated by this Agreement, Purchaser
will acquire title to the Purchased Assets free and clear of any Liens, other
than those Liens which are described on Schedule 3.19.
(b) Schedules 2.1(a), (b), (d), (e) and (f) and Schedule 3.9 are true,
accurate and complete. At the Closing, Purchaser will own or have the right
to use under a valid lease without the requirement of any payment with
respect thereto (other than if such payment obligation is an Assumed
Liability) all of the Purchased Assets.
(c) The Purchased Assets are in the condition they were in on November 19,
2003, ordinary wear and tear excepted, except for the Purchased Assets listed
on Schedule 5.11 which are subject to the provisions of Section 5.11.
(d) All Taxes with respect to the Purchased Assets have been paid in full for
years prior to 2004, other than certain sales taxes and personal property
taxes due for years prior to 2004, which shall remain the responsibility of
Seller after Closing.
(e) The outstanding principal amount of the Bonds is $40,000,000.
(f) The Building 20 Items (i) are not used in the Business as presently
conducted and (ii) have not been, at any time, represented by Seller to
Purchaser, to be Assets included in the Purchased Assets.
ARTICLE IV. REPRESENTATIONS AND WARRANTIES OF PURCHASER.
As an inducement to Seller to enter into this Agreement and to consummate the
Acquisition, Purchaser represents and warrants to Seller, that each of the
following representations and warranties is true and correct as of the date
hereof and will be true and correct on and as of the Closing Date:
4.1 Organization and Qualification. Purchaser is a corporation duly
organized, validly existing and in good standing under the laws of the State
of Maryland and has all requisite power and authority, corporate or otherwise,
to own, lease and operate its properties and to carry on its business as it is
now being conducted. Purchaser is duly qualified or licensed to do business,
and is in good standing, in each jurisdiction where the character of the
properties owned, leased or operated by it or the nature of its activities
makes such qualification or licensing necessary, expect when the failure to
be so qualified or licensed would not have a material adverse effect on
Purchaser.
4.2 Authority Relative to this Agreement. Purchaser has all necessary
corporate power and authority to execute and deliver this Agreement and the
other Transaction Documents to which it is a party, to perform its obligations
hereunder and thereunder and to consummate the Acquisition. The execution and
delivery of this Agreement and the other Transaction Documents by Purchaser
and the consummation by Purchaser of the Acquisition have been duly and
validly authorized by all necessary corporate action on the part of Purchaser,
and no other corporate proceedings on the part of Purchaser are necessary to
authorize this Agreement or to consummate the Acquisition. This Agreement and
the other Transaction Documents have been or will be duly executed and
delivered by Purchaser and, assuming the due authorization, execution and
delivery by the other Parties hereto, each such agreement constitutes a legal,
valid and binding obligation of Purchaser, enforceable against Purchaser in
accordance with its terms, subject to the Bankruptcy Exception.
4.3 No Conflict. Except as set forth on Schedule 4.3, the execution and
delivery of this Agreement by Purchaser do not, and the performance by
Purchaser of its obligations hereunder and the consummation of the Acquisition
will not: (i) conflict with or violate any provision of the articles of
incorporation or by-laws of Purchaser or any resolutions adopted by the board
of directors of Purchaser; or (ii) assuming that all filings and notifications
described in Section 4.4 have been made, conflict with or violate any Law or
Order applicable to Purchaser or by which Purchaser is bound or affected.
4.4 Required Filings and Consents . The execution and delivery of this
Agreement by Purchaser do not, and the performance by Purchaser of its
obligations hereunder and the consummation of the Acquisition will not,
require any consent, approval, authorization or permit of, or filing by
Purchaser with or notification by Purchaser to, any Governmental Authority,
except for (a) the consents, approvals, authorizations, declarations or
rulings set forth on Schedule 4.4 and (b) the filing of a Notification and
Report Form pursuant to the HSR Act, and the expiration or earlier termination
of the applicable waiting period thereunder with respect to the Acquisition.
4.5 No Finder. Except as set forth on Schedule 4.5, neither Purchaser nor
any Person acting on behalf of Purchaser has agreed to pay to any broker,
finder, investment banker or any other Person, a brokerage, finder's or other
fee or commission in connection with this Agreement or any matter related
hereto, nor has any broker, finder, investment banker or any other Person
taken any action on which a Claim for any such payment could be based.
Purchaser shall be solely responsible for paying any and all fees, commissions
or other compensation to which any party disclosed on Schedule 4.5 is entitled
or claims on account of the Acquisition.
ARTICLE V. COVENANTS OF THE PARTIES PRIOR TO CLOSING DATE
5.1 Conduct of Business . From the date hereof through the Closing Date,
except as contemplated by this Agreement or disclosed on Schedule 5.1, Seller
agrees:
(a) Not to undertake (nor permit to be undertaken) any of the actions
specified in Section 3.7;
(b) To operate the Business in a reasonable and prudent manner, to conduct
Seller's operations in respect to the Business according to the ordinary and
usual course consistent with past practice, to preserve intact in respect to
the Business Seller's present business organization and structure, to keep
available in respect to the Business the services of Seller's present
employees, to use reasonable commercial efforts to preserve and maintain the
Purchased Assets (including without limitation, the machinery and equipment
included in the Purchased Assets) in the condition they were in on November
19, 2003 (ordinary wear and tear excepted), to preserve Seller's rights to be
assigned to Purchaser hereunder, and to use best efforts to preserve in
respect to the Business Seller's relationships with and retain all suppliers,
independent contractors, employees and other Persons material to the operation
of such Business;
(c) To maintain in the ordinary course of the Business, consistent with past
practice and in accordance with any applicable Contracts, the Tangible
Personal Property and the Real Property, in the condition that such Assets
were in on November 19, 2003, ordinary wear and tear excepted;
(d) To maintain the Books and Records in respect to the Business in the usual
and ordinary manner and in a manner that fairly and correctly reflects the
costs and expenses, Assets and Liabilities of Seller in accordance with GAAP;
(e) To pay all account and trade payables in respect to the Business in the
ordinary course of the Business;
(f) Not to incur any Liability in respect to the Business (other than
Liabilities incurred in the ordinary course of the Business, consistent with
past practice);
(g) Not to sell, transfer, convey, assign or otherwise dispose of any
Purchased Assets, except in the ordinary course of the Business consistent
with past practice; and not to create, incur, assume or suffer to exist any
Lien on any Purchased Assets, other than Liens that may exist on the date
hereof;
(h) Not to terminate, modify, amend, waive or otherwise alter or change any
of the material terms or provisions of any Assigned Contract or create any
default under the terms of any Contract or pay any amount not required by Law
or by any Assigned Contract;
(i) Not to engage in any practice, take any action, fail to take any action
or enter into any transaction which could cause any representation or warranty
of Seller to be untrue in any material respect or result in a material breach
of any covenant made by Seller;
(j) To keep in full force and effect all of Seller's Insurance Policies and
not permit any material breach or default thereof, or the termination or
cancellation thereof, to occur or exist;
(k) To consult with Purchaser prior to any renewal, amendment, extension or
termination of, waiver of any material right under, or any failure to renew,
any Assigned Contract and will refrain from taking any such action if
Purchaser objects thereto in writing; and
(l) To use reasonable commercial efforts to conduct Seller's affairs in such
a manner that the representations and warranties of Seller contained herein
shall continue to be true and correct on and as of the Closing Date as if made
on and as of the Closing Date.
5.2 Consents, Filings and Authorizations; Efforts to Consummate . As
promptly as practicable after the date hereof, Purchaser and Seller shall make
all filings and submissions under such Laws as are applicable to them or to
their respective Affiliates including the filing of a Notification and Report
Form pursuant to the HSR Act, and as may otherwise be required for them to
consummate the Acquisition in accordance with the terms of this Agreement and
shall consult with each other prior to such filing and shall not make any such
filing or submission to which Seller or Purchaser, as the case may be,
reasonably objects in writing. All such filings shall comply in form and
content in all material respects with applicable Laws. Subject to the terms
and conditions herein, each Party, without payment or further consideration,
shall use its reasonable commercial efforts to take or cause to be taken all
action and to do or cause to be done all things necessary, proper or advisable
under applicable Laws, Permits and Orders, to consummate and make effective,
as soon as reasonably practicable, the Acquisition, including, but not limited
to, obtaining all required consents, whether private or governmental, required
in connection with such Party's performance of such transactions and each
Party shall cooperate with the other in all of the foregoing.
5.3 No Shop . From and after the date hereof unless and until this Agreement
shall have been terminated in accordance with its terms, Seller hereby agrees
and shall cause its Representatives to agree not to solicit, initiate or
encourage negotiations or discussions of any type, directly or indirectly,
with any Person relating to any other sale or transfer of the Purchased
Assets. Seller shall notify Purchaser promptly if any unsolicited proposal or
offer, or any inquiry or contact with any Person with respect thereto, is
made, such notice to include the identity of the Person making such proposal,
offer, inquiry or contact, and the terms of such offer.
5.4 Notices of Certain Events. Prior to the Closing Date, Seller, on the one
hand, and Purchaser, on the other hand, shall promptly notify the other of:
(a) any notice or other communication from any Person alleging that the
consent of such Person is or may be required in connection with the Acquisition;
(b) any notice or other oral or written communication from any Governmental
Authority in connection with the Acquisition or relating to Seller;
(c) any event, condition or circumstance occurring from the date hereof
through the Closing Date that would constitute a material violation or breach
of any representation or warranty, whether made as of the date hereof or as
of the Closing Date, or that would constitute a material violation or breach
of any covenant of any Party;
(d) any failure of Seller or Purchaser, as the case may be, to comply, in any
material way, with or satisfy any covenant, condition or agreement to be
complied with or satisfied by it hereunder;
(e) any material developments affecting the Purchased Assets, Liabilities,
business prospects, financial condition, operations, results of operations or
supplier or employee relations of Seller or the Business; and
(f) any change that could reasonably be expected to have a Material Adverse
Effect, or could delay or impede the ability of any of Seller or Purchaser to
perform its obligations pursuant to this Agreement and to consummate the
Acquisition.
5.5 Public Announcements. From and after the date of this Agreement until the
Closing, Purchaser and Seller agree not to make any public announcement or
other disclosure concerning this Agreement or the transactions contemplated
herein without obtaining the prior consent of the other Party (the "Reviewing
Party") as to form, content and timing; provided, however, that the consent of
the Reviewing Parties shall not be unreasonably withheld. Notwithstanding the
foregoing, if, upon advice of legal counsel, either Party determines that
public announcement or disclosure is required by applicable Law, including the
rules of any securities exchange on which such Party's securities may be listed,
then the other Party hereto shall only have the right to review and comment
upon (but not consent to) any such press release or public statement prior to
its issuance.
5.6 Confidentiality.
(a) Prior to the Closing Date, each Party shall hold in strict confidence, and
shall use its commercially reasonable efforts to cause all of its
Representatives to hold in strict confidence, unless compelled to disclose by
judicial or administrative process, or by other requirements of Law, all
confidential information concerning the other Party which it has obtained from
such other Party or their Representatives in connection with the Acquisition
("Confidential Information"), and neither Party shall not use or disclose to
others, or permit the use of or disclosure of, any Confidential Information of
the other Party so obtained; nor will any Party release or disclose
Confidential Information to any other Person, except such Party's
Representatives who need to know Confidential Information in connection with
this Agreement (and who shall be advised of the provisions of this Section
5.6(a)). The foregoing provision shall not apply to any Confidential
Information to the extent: (i) known by a Party prior to the date Confidential
Information was provided it by the other Party or its Representatives in
connection with the Acquisition; (ii) made known to a Party from a third party
not in breach of any confidentiality requirement; or (iii) made public through
no fault of a Party or any of its Representatives.
(b) If this Agreement is terminated as provided herein and the Acquisition is
not consummated, each Party shall return to the other Party, all tangible
evidence of such information received by it, if requested by such other Party.
5.7 Expenses. Except as otherwise specifically provided in this Agreement,
each of the Parties shall bear its own expenses incurred in connection with the
preparation, execution and performance of this Agreement and the Acquisition,
including all fees and expenses of its Representatives. Notwithstanding the
foregoing: (a) documentary stamp, county and local transfer taxes and recording
taxes relating to the instruments of conveyance contemplated herein shall be
paid by Seller; (b) Purchaser shall pay any required filing fees under the HSR
Act; and (c) Purchaser and Seller shall each pay fifty percent (50%) of any
sales taxes payable by reason of the transactions contemplated hereby.
5.8 Supplements to Disclosure Schedules. It is understood and agreed that,
with respect to the representations and warranties of Seller contained in
Article III hereof, Seller shall have the continuing obligation until the
Closing Date to supplement, modify or amend promptly the schedules set forth in
this Agreement (collectively, the "Schedules") with respect to: (i) any matter
occurring after the date hereof that, if existing or occurring on or before the
date of this Agreement, would have been required to be set forth or described
in the Schedules ("Seller New Matters"), and (ii) other matters which are not
Seller New Matters but should have been set forth or described in the Schedules
as of the date hereof ("Seller Other Matters"). The disclosure provided by
Seller in any such amended, supplemented or revised Schedule shall in no way
affect or be deemed to limit Purchaser's right and option, exercisable at any
time prior to the Closing, to provide written notice to Seller that Purchaser
has elected to terminate this Agreement and the Acquisition if, in the exercise
of Purchaser's commercially reasonable good faith judgment, items added to the
Schedules that were not included in the Schedules in the form attached to this
Agreement at the time of execution, disclose that matters exist which may have,
individually or in the aggregate, a Material Adverse Effect. If Purchaser does
not elect to terminate this Agreement as provided above, this Agreement shall
remain in full force and effect subject to the express provisions hereof. Any
such supplement, modification or amendment (i) that reflects a Seller New
Matter shall qualify Seller's representations and warranties for all purposes
of this Agreement and (ii) that reflects one or more Seller Other Matters shall
not qualify any of Seller's representations and warranties for any purpose
under this Agreement, and shall be provided solely for informational purposes.
On or before the Closing Date, Seller will prepare and deliver to Purchaser a
copy of the Schedules revised to reflect any supplement, modification or
amendment required pursuant to this Section 5.8. Seller shall use commercially
reasonable efforts to deliver any such supplemented, modified or amended
Schedules to Purchaser at least three (3) Business Days before the Closing Date.
5.9 Access to Information; Records. Between the date hereof and the Closing
Date, Seller shall permit Purchaser and its legal counsel, accountants, agents,
employees and other representatives and advisors full access, upon reasonable
notice, and with interference with Seller's business operations, to all of the
financial, legal and other representatives and employees of Seller with
knowledge of the Business, and to the personnel, books, records, properties,
contracts and commitments of Seller relating to the Business and the Purchased
Assets and to third parties doing business with Seller relating to the Business
and the Purchased Assets; provided, however, that in the event that Purchaser's
access to any of the foregoing items is restricted pursuant to a valid
confidentiality agreement, upon request by Purchaser, Seller shall use its
reasonable commercial efforts to obtain a waiver or release of such restriction
for the benefit of Purchaser. The representations and warranties contained in
Article III shall not be affected or deemed waived by reason of the fact that
any of Purchaser, its legal counsel, accountants, agents, employees and other
representatives and advisors know or discover or should have known or
discovered that any such representation or warranty is or might be inaccurate
in any respect.
5.10 Employees. Seller shall cooperate with Purchaser with respect to
Purchaser's evaluation of the employees of the Business who may be offered
employment by Purchaser. Purchaser will offer employment to a sufficient
number of Seller's employees at each plant location (as described in the
WARN Act) of the Business to ensure that there does not occur, with respect
to any such location, a plant closing (as described in the WARN Act),
provided that purchaser shall not be obligated to employ any individual who
is not authorized to work in the United States. Seller will terminate all
such employees who have accepted offers of employment by Purchaser effective
on the Closing Date. Seller agrees that Purchaser retains sole and complete
discretion regarding which employees of Seller's Business Purchaser will offer
employment effective on the Closing Date. From the date hereof through the
Closing, Seller shall cooperate with and permit Purchaser to communicate in
writing with such employees, at reasonable times and upon reasonable notice,
concerning Purchaser's plans, operations and general personnel matters and
to interview the
employees and review the personnel records and such other information
concerning the employees as Purchaser may reasonably request (subject to
obtaining any legally required permission and to other applicable laws).
Seller shall be solely responsible for any notification and liability under
the WARN Act or state equivalent statutes relating to any termination of
its employees occurring prior to or after the date of this Agreement,
whether or not in connection with the transactions contemplated hereby.
Seller shall be responsible for all liabilities and obligations for employee
or independent contractor (and their respective beneficiaries') compensation
and benefits accrued or otherwise arising out of services rendered by its
Business employees, directors and independent contractors prior to the
Closing or, except as otherwise provided herein, arising by reason of
actual, constructive or deemed termination of their service relationship
with Seller at Closing. Seller's responsibilities shall include any Seller
Employee Benefit Plan, any all costs relating to the continuation of health
benefits and notices under the Consolidated Omnibus Budget Reconciliation Act
of 1985, as amended, any severance obligations and bonus retention or related
obligations, whether or not under the terms of specific employment agreements
between Seller and one or more employees. Seller shall also be responsible
for paying as of the Closing Date any and all accrued vacation pay and any
sick pay that may then be due and payable (or be payable as a result of any
termination by Seller with respect to this Agreement) as to employees of
Seller whose employment with Seller is terminated in connection with the
implementation of this Agreement. Seller agrees to maintain all
personnel files of all employees of Seller, compiled as of the Closing Date,
for a period of five (5) years at a location other than the Processing Plant,
the Feed Mill/Hatchery, the Wastewater Facility, the Leased Garage or the Real
Property, and Seller shall fully comply with all Laws or other requirements
necessary to properly and lawfully maintain such personnel files.
5.11 Pre-Closing Projects . Between the date hereof and the Closing Date,
Seller shall, at Seller's cost and expense, complete the repairs and projects
set forth on Schedule 5.11 to Purchaser's reasonable satisfaction
(collectively, the "Pre-Closing Projects").
ARTICLE VI. CONDITIONS TO CLOSING.
6.1 Conditions to the Obligations of Seller and Purchaser. The obligations of
Seller and Purchaser to consummate the Acquisition are subject to the
satisfaction or, if permitted by applicable Law, waiver of the following
conditions on or prior to the Closing Date:
(a) No Injunction. No provision of any applicable Law will be in effect and no
interlocutory, appealable or final Order will have been issued that prohibits
or restricts the consummation of the Acquisition;
(b) No Litigation. No Claim instituted by any Person shall have been
commenced or pending against Seller or Purchaser or any of their respective
Affiliates or Representatives, which Claim seeks to restrain, prevent, change
or delay in any material respect the Acquisition or seeks to challenge any of
the material terms or provisions of this Agreement or seeks material damages
in connection with any of such transactions;
(c) HSR. Any waiting period applicable to the consummation of the Acquisition
under the HSR Act shall have expired or been terminated, and no action shall
have been instituted by the Department of Justice or the Federal Trade
Commission challenging or seeking to enjoin the consummation of the Acquisition,
which action shall not have been withdrawn or terminated without imposing
material limitations on the ability of Purchaser effectively to exercise full
rights of ownership of the Business and the Purchased Assets requiring Purchaser
to dispose of or divest of any of its assets or businesses or discontinue or
refrain from conducting any of its operations or those acquired hereunder;
(d) Approvals in Connection with the Bond Documents. All consents, approvals
and authorizations legally required to be obtained to transfer to Purchaser all
of Seller's right, title and interest in and to the Bonds and the other Bond
Documents shall have been obtained, including the approval of the Development
Authority of Houston County and the trustee for the Bonds; and
(e) Consents. All consents, approvals and authorizations legally required to
be obtained to consummate the Acquisition shall have been obtained from all
Governmental Authorities, except where the failure to obtain any such consent,
approval or authorization could not reasonably be expected to result in a
Material Adverse Effect.
6.2 Conditions to Obligations of Seller. The obligations of Seller to
consummate the Acquisition is subject to the fulfillment prior to the specified
date or at the time of Closing of the following conditions with respect to
Purchaser, any one or more of which may be waived in whole or in part by Seller:
(a) Accuracy of Representations and Warranties. Each of the representations
and warranties of Purchaser contained in this Agreement, any Transaction
Document to which it is a party and in any certificate or other writing
delivered by Purchaser pursuant hereto shall be true, complete and correct in
all material respects (other than representations and warranties subject to
"materiality" qualifiers, which shall be true, complete and correct as stated)
both when made and on and as of the Closing as if made at and as of the
Closing (other than representations and warranties which address matters only
as of a certain date which shall have been true, complete and correct as of
such certain date).
(b) Performance. Purchaser shall have performed and complied in all material
respects with all agreements, obligations and covenants required to be
performed or complied with by it on or prior to the Closing Date.
(c) Other Agreements. The negotiation of a mutually acceptable (i) Assignment
and Assumption Agreement (ii) Supply Agreement and (iii) Transition Services
Agreement.
(d) Closing Purchase Price. The Purchase Price referenced in Section 2.5(b)
shall have been paid by Purchaser in accordance such Section.
(e) Deliveries. Purchaser shall have delivered to Seller the following:
(i) A certificate, dated the Closing Date, of an executive officer of
Purchaser confirming the matters set forth in Section 6.2(a) and (b) hereof;
(ii) A certificate, dated the Closing Date, of the Secretary or Assistant
Secretary of Purchaser certifying, among other things, that attached or appended
to such certificate: (A) is a true copy of all corporate actions taken by it,
including resolutions of its board of directors authorizing the consummation of
the Acquisition and the execution, delivery and performance of this Agreement
and each of the Transaction Documents to be delivered by Purchaser pursuant
hereto and (B) are the names and signatures of its duly elected or appointed
officers who are authorized to execute and deliver this Agreement, the
Transaction Documents to which Purchaser is a party and any certificate,
document or other instrument in connection herewith;
(iii) An Assignment and Assumption Agreement executed by Purchaser, in form,
scope and substance satisfactory to Seller;
(iv) The Bond Assignment and Assumption Agreement executed by Purchaser;
(v) A Supply Agreement executed by Purchaser, in form, scope and substance
satisfactory to Seller;
(vi) A Transition Services Agreement executed by Purchaser, in form, scope and
substance satisfactory to Seller;
(vii) A certificate of good standing from the appropriate state agency, dated
as of a recent date, certifying that Purchaser is in good standing in the
States of Maryland and Georgia;
(viii) A signed opinion from ▇▇▇▇▇ ▇▇▇▇▇▇▇ LLP, Purchaser's legal counsel,
dated as of the Closing Date and addressed to Seller, in form and substance
reasonably acceptable to Seller;
(ix) True, correct and complete copies of all required consents set forth on
Schedule 4.4; and
(x) an executed IRS Form 8594.
6.3 Conditions to Obligations of Purchaser . The obligations of Purchaser to
consummate the Acquisition is subject to the fulfillment prior to the specified
date or at the time of Closing of the following conditions with respect to
Seller, any one or more of which may be waived in whole or in part by Purchaser:
(a) Accuracy of Representations and Warranties. Each of the representations
and warranties of Seller contained in this Agreement, any Transaction Document
to which they are parties and in any certificate or other writing delivered by
Seller pursuant hereto shall be true, complete and correct in all material
respects (other than representations and warranties subject to "materiality" or
"Material Adverse Effect" qualifiers, which shall be true, complete and correct
as stated) both when made and on and as of the Closing as if made at and as of
the Closing (other than representations and warranties which address matters
only as of a certain date which shall have been true, complete and correct as
of such certain date).
(b) Performance. Seller shall have performed and complied in all material
respects with all agreements, obligations and covenants required to be
performed or complied with by it on or prior to the Closing Date.
(c) No Material Adverse Change. During the period from the date hereof to the
Closing Date, there shall not have occurred any Material Adverse Effect or any
of the actions described in Section 3.7.
(d) Due Diligence. Purchaser and its Representatives shall have completed
their due diligence investigation of the Purchased Assets and the Business,
and related matters, and the results of such due diligence investigation shall
be satisfactory to Purchaser in its sole and absolute discretion, including,
without limitation, in respect to environmental problems, or issues.
(e) Other Agreements. The negotiation of a mutually acceptable (i) Assignment
and Assumption Agreement (ii) Supply Agreement (iii) Transition Services
Agreement and (iv) ▇▇▇▇ of Sale.
(f) Deliveries. Seller shall have delivered to Purchaser the following:
(i) A certificate, dated the Closing Date, of an executive officer of Seller
confirming the matters set forth in Section 6.3(a) and (b) hereof;
(ii) A certificate, dated the Closing Date, of the Secretary or Assistant
Secretary of Seller certifying, among other things, that attached or appended
to such certificate: (A) is a true and correct copy of the charter and by-laws
of Seller, and all amendments thereto; (B) is a true copy of all corporate
actions taken by it, including resolutions of its board of directors
authorizing the consummation of the Acquisition and the execution, delivery
and performance of this Agreement and each of the Transaction Documents to be
delivered by Seller pursuant hereto; and (C) are the names and signatures of
its duly elected or appointed officers who are authorized to execute and
deliver this Agreement, the Transaction Documents to which Seller is a party
and any certificate, document or other instrument in connection herewith;
(iii) An Assignment and Assumption Agreement executed by Seller, in form, scope
and substance satisfactory to Purchaser;
(iv) The Bond Assignment and Assumption Agreement executed by Seller and the
DAHC;
(v) An executed ▇▇▇▇ of sale for all Tangible Personal Property owned by
Seller, in form and substance reasonably acceptable to Purchaser (the "▇▇▇▇ of
Sale");
(vi) A Supply Agreement executed by Seller, in form, scope and substance
satisfactory to Purchaser;
(vii) A Transition Services Agreement executed by Seller, in form, scope and
substance satisfactory to Purchaser;
(viii) Certificate of good standing from the appropriate state agency, dated as
of a recent date, certifying that Seller is in good standing in the State of
Georgia;
(ix) A signed opinion from (i) ▇▇▇▇▇, ▇▇▇▇▇ & ▇▇▇▇▇, P.C and (ii) ▇▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇ & ▇▇▇▇▇▇▇ LLP, each Seller's legal counsel, dated as of the Closing Date
and addressed to Purchaser, in form and substance reasonably acceptable to
Purchaser;
(x) True, correct and complete copies of all consents or approvals necessary
for the assignment or transfer of the the Perry Real Property Lease, the Perry
Equipment Lease and the other Bond Documents, the Wastewater Facility Lease,
the Garage Lease, the Assigned Contracts and any other required consents set
forth on Schedule 3.5;
(xi) Executed copies of such documents as may be required to assign the Bond
Encumbrances to Purchaser;
(xii) An executed IRS Form 8594;
(xiii) Possession and control of the Purchased Assets;
(xiv) A certificate, duly executed and acknowledged by Seller under penalties
of
perjury, in the form prescribed by Treasury Regulation Section 1.1445-
2(b)(2)(iii), stating Seller's name, address and Federal tax identification
number, and that Seller is not a "foreign person" within the meaning of Section
1445 of the Code;
(xv) Duly executed special warranty deeds from Seller in favor of Purchaser or
Purchaser's designee, in recordable form, transferring good and marketable fee
simple title to any Real Property to be conveyed by Seller to Purchaser
hereunder, subject only to the Permitted Encumbrances, and such affidavits or
other customary instruments as Purchaser's title insurance company may
reasonably request, including, but not limited to: (A) owner's affidavits; (B)
pay-off letters and lien releases; and (C) gap indemnities if, in a particular
locality, the title insurance company will not insure the period between the
Closing and the recordation of the deeds;
(xvi) Estoppel certificates from lessors, if any, in form and substance
reasonably acceptable to Purchaser;
(xvii) Uniform Commercial Code, Federal and State tax lien, bankruptcy and
judgment searches with respect to Seller for the State of Georgia, prepared by
search companies reasonably satisfactory to Purchaser, and not dated earlier
than fifteen (15) days prior to the Closing Date;
(xviii) releases of all Liens (other than the Permitted Encumbrances) held in
any of the Purchased Assets, including, without limitation, UCC-3 termination
statements;
(xix) Articles of Transfer or other transfer document executed by Seller to the
extent such transfer document is required to be filed with any Governmental
Authority upon consummation of the Acquisition;
(xx) Original certificates of title to all vehicles or rolling stock included
in the Purchased Assets, executed by Seller to the extent necessary to reflect
the assignment by Seller to Purchaser of such assets;
(xxi) An ALTA Owner's Policy of Title Insurance issued by the Chicago Title
Insurance Company, or other national title insurance company acceptable to
Purchaser, insuring Purchaser as owner of fee simple title to the Real Property
and as holder of leasehold title to the Perry Leased Property and the
Wastewater Facility Leased Property, subject only to Permitted Encumbrances,
in the amounts and containing such endorsements as Purchaser shall reasonably
request. In addition, Purchaser shall have received an ALTA/ACSM survey for
the Perry Leased Property and the Wastewater Facility Leased Property
satisfactory to Purchaser, showing no matters other than the Permitted
Encumbrances.
(xxii) Replacement Quitclaim Deed and ▇▇▇▇ of Sale from the DAHC to the
Purchaser (which shall be delivered to SunTrust Bank, as trustee with respect
to the Bonds);
(xxiii) Memorandum of the Wastewater Facility Lease or the original executed
copy of the Wastewater Facility Lease in form and substance suitable for
recordation; and
(xxiv) Such other documents and instruments as may be reasonably requested by
Purchaser to consummate the Acquisition and to carry out the obligations of the
Parties hereunder.
(g) Pre-Closing Projects. Seller shall have completed the Pre-Closing Projects
in accordance with Section 5.11 and Schedule 5.11.
ARTICLE VII. TERMINATION; EFFECT OF TERMINATION
7.1 Termination of Agreement. This Agreement may be terminated and the
Acquisition may be abandoned at any time prior to the Closing:
(a) By Purchaser if the condition set forth in Section 6.3(d) has not been
satisfied as provided therein;
(b) By mutual written consent of Seller and Purchaser, and after February 15,
2004, by either Seller or Purchaser, if the Closing has not occurred by that
date and if failure to close is not the result of a breach of this Agreement or
a willful failure to complete closing conditions by such terminating Party;
(c) By Seller, if: (i) there has been a material misrepresentation or breach by
Purchaser of a representation or warranty contained herein and such material
misrepresentation or breach, if curable, is not cured within ten (10) Business
Days after written notice thereof from Seller; (ii) Purchaser has committed a
material breach of any covenant imposed upon it hereunder and, if curable,
fails to cure such breach within ten (10) Business Days after written notice
thereof from Seller; or (iii) any condition to Seller's obligations hereunder
becomes incapable of fulfillment through no fault of Seller and is not waived
by Seller;
(d) By Purchaser, if: (i) there has been a material misrepresentation or breach
by Seller of a representation or warranty contained herein and such material
misrepresentation or breach, if curable, is not cured within ten (10) Business
Days after written notice thereof from Purchaser; (ii) Seller has committed a
material breach of any covenant imposed upon it hereunder and, if curable,
fails to cure such breach within ten (10) Business Days after written notice
thereof from Purchaser; or (iii) any condition to Purchaser's obligations
hereunder becomes incapable of fulfillment through no fault of Purchaser and
is not waived by Purchaser; or
(e) By Purchaser, on the one hand, or Seller, on the other hand, if there shall
be any Law that makes consummation of the Acquisition illegal or otherwise
prohibited, or if any Order enjoining Purchaser, on the one hand, or Seller, on
the other hand, from consummating the Acquisition is entered and such Order
shall have become final and nonappealable, provided that the Party seeking to
terminate this Agreement pursuant to this provision shall have used all
reasonable efforts to remove or vacate such Order.
7.2 Effect of Termination; Right to Proceed. In the event that this Agreement
shall be terminated pursuant to Section 7.1(a), (b) or (e), all further
obligations of the Parties shall terminate without further Liability of any
Party (except with respect to Sections 5.5, 5.6, 5.7). In the event that this
Agreement shall be terminated by Purchaser pursuant to Section 7.1(d)(i) or
(ii), Seller shall reimburse Purchaser for all of Purchaser's attorney's fees
and related costs incurred in connection with the negotiation and preparation
of this Agreement. In the event that this Agreement shall be terminated by
Seller pursuant to Section 7.1(c)(i) or (ii), Purchaser shall reimburse Seller
for all of Seller's attorney's fees and related costs incurred in connection
with the negotiation and preparation of this Agreement. The agreements
contained in Sections 5.5, 5.6 and 5.7 shall survive the termination hereof.
In the event that a condition precedent to a Party's obligation is not met,
nothing contained herein shall be deemed to require any Party to terminate this
Agreement, rather than to waive such condition precedent and proceed with the
Acquisition.
ARTICLE VIII. POST-CLOSING COVENANTS
8.1 Post-Closing Projects . Prior to the first anniversary of the Closing
Date, Seller shall have completed all of the activities, repairs and other
items set forth on, and in accordance with, Schedule 8.1 (collectively, the
"Post-Closing Projects"). The terms, conditions and timeline in respect to the
Post-Closing Projects shall be in accordance with this Section 8.1 and the
terms set forth in Schedule 8.1.
8.2 Claims Under Insurance Policies . After the Closing Date, each Party shall
cooperate with the other Party in respect of the defense of Claims made after
the Closing Date under occurrence-based Insurance Policies based upon events
occurring prior to the Closing Date. Each Party agrees not to limit, modify or
otherwise compromise the other Party's ability to make Claims under any such
Insurance Policies, provided that the insurer agrees to waive any right of
subrogation that it might otherwise have against such first Party.
8.3 Certain Transitional Matters . From and after the Closing Date:
(a) Purchaser shall have complete control over the payment, settlement or other
disposition of, or any dispute involving any Assumed Liabilities, and Purchaser
shall have the right to conduct and control all negotiations and proceedings
with respect thereto. Seller shall notify Purchaser promptly of any Claim with
respect to any Assumed Liabilities and shall not, except with the prior written
consent of Purchaser, voluntarily make any payment of, or settle or offer to
settle, or consent to any compromise with respect to, any such Assumed
Liabilities. Seller shall cooperate with Purchaser in connection with any
negotiations or proceedings involving any Assumed Liabilities; and
(b) If the Closing occurs at a time when not all Permits and Environmental
Permits have been transferred to Purchaser, the Parties shall continue to abide
by their obligations hereunder to obtain all such transfers, as soon as
practicable, and Seller authorizes Purchaser, to the extent permitted by Law,
to use any such Permits and Environmental Permits in its business operations
after the Closing.
8.4 Further Assurances; Continuing Access to Records.
(a) Seller hereby agrees, without further consideration, to execute and deliver
following the Closing such other instruments of transfer and take such other
action as Purchaser or its counsel may reasonably request in order to put
Purchaser in possession of, and to vest in Purchaser, good, valid and
unencumbered title to the Purchased Assets in accordance with this Agreement
and to consummate the Acquisition. Purchaser hereby agrees, without further
consideration, to take such other action following the Closing and execute and
deliver such other documents as Seller or its counsel may reasonably request in
order to consummate the Acquisition in accordance with this Agreement.
Notwithstanding the generality of the foregoing, Seller agrees to enter into
such agreements as may be reasonably requested by Purchaser having the effect
of assigning the rights of Purchaser hereunder and under the documents executed
in connection herewith to the lenders of Purchaser providing financing for the
Acquisition and/or to the other lenders to Purchaser and/or its Affiliates.
(b) After the Closing Purchaser shall permit Seller, at Seller's expense, upon
Seller's reasonable request with at least ten (10) days' notice, to inspect
records, books and other documents relating to the Business or the Purchased
Assets (including human resources or other employee files and records) for the
purposes of preparing tax returns and financial statements, responding to tax
audits and for other legitimate business purposes, in all cases solely with
respect to matters arising prior to the Closing Date.
ARTICLE IX. SURVIVAL; INDEMNIFICATION
9.1 Survival of Representations and Warranties . Notwithstanding any right of
Purchaser to fully investigate the affairs of Seller and any knowledge of facts
determined or determinable by Purchaser pursuant to such investigation or right
of investigation, Purchaser has the right to rely fully upon the
representations, warranties, covenants and agreements of Seller contained in
this Agreement, or listed or disclosed on any Schedule hereto. All of such
representations, warranties, covenants, agreements shall survive the execution
and delivery of this Agreement and the Closing hereunder for a period of 18
months following the Closing Date; provided, that: (a) the representations and
warranties made in (i) Section 3.3 with respect to due authority, (ii) Section
3.8 with respect to title and or rights in respect to the Purchased Assets,
Perry Leased Real Property, Perry Leased Equipment, Wastewater Facility Leased
Real Property, Wastewater Facility Leased Assets and the Leased Garage and
(iii) Section 3.14 or 4.5 with respect to finder's fees and commissions, shall
survive indefinitely; (b) the representations and warranties made in Section
3.15 shall survive for a period of four (4) years following the Closing Date;
(c) Claims related to intentional fraud or willful misconduct shall survive
indefinitely; and (d) Claims related to and made under Sections 9.2(iii), (iv),
(v) or (vi) shall survive indefinitely. There shall be no termination of any
such representation or warranty as to which a Claim has been asserted prior to
the termination of such survival period.
9.2 Indemnification by Seller . Subject to the limitations set forth in
Section 9.1 and 9.7, Seller shall indemnify, defend, save and hold Purchaser
and its Representatives, officers, directors, employees, agents or Affiliates
(Purchaser and all such Persons are hereinafter collectively referred to as
"Purchaser Indemnitees") harmless from and against all Damages asserted
against, imposed upon, resulting to, required to be paid by, or incurred by
any Purchaser Indemnitee, directly or indirectly, in connection with, arising
out of, which could result in, or which would not have occurred but for:
(i) Seller's breach of any representation or warranty contained in this
Agreement;
(ii) Seller's breach or nonfulfillment of any covenant or agreement made by
Seller in or pursuant to this Agreement;
(iii) Seller's failure to comply with any bulk sales or fraudulent transfer
laws that may be applicable to the Acquisition;
(iv) A Retained Liability;
(v) Any Liability arising out of the ownership or operation of the Purchased
Assets or the Business prior to the Closing, other than (A) any Assumed
Liability or (B) a Liability arising out of a violation of an Environmental Law
or an environmental condition on or with respect to any of Seller's Properties,
unless such Liability is otherwise the subject of indemnity, defense or saving
or holding harmless pursuant to clauses (i), (ii) or (vi) of this Section 9.2.;
or
(vi) Any Liability arising out of either of the following: (A) a violation of
an Environmental Law in effect as of or prior to the Closing Date caused by an
act or omission of Seller, its officers, agents, contractors, employees or
invitees, involving the Seller's Properties; or (B) any off-site disposal by
Seller.
9.3 Indemnification by Purchaser . Purchaser shall indemnify, defend, save and
hold Seller and its Representatives, officers, directors, employees, agents or
Affiliates (Seller and all such Persons are hereinafter collectively referred
to as "Seller Indemnitees") harmless from and against any and all Damages
asserted against, imposed upon, resulting to, required to be paid by, or
incurred by any Seller Indemnitees, directly or indirectly, in connection with,
arising out of, which could result in, or which would not have occurred but for:
(a) Purchaser's breach of any representation or warranty contained in this
Agreement;
(b) Purchaser's breach or nonfulfillment of any covenant or agreement made by
Purchaser in or pursuant to this Agreement; or
(c) An Assumed Liability after the Closing Date.
9.4 Notice of Claims . If any Purchaser Indemnitee or Seller Indemnitee (an
"Indemnified Party") believes that it has suffered or incurred or will suffer
or incur any Damages for which it is entitled to indemnification under this
Article IX, such Indemnified Party shall so notify the party or parties from
whom indemnification is being claimed (the "Indemnifying Party") with
reasonable promptness and reasonable particularity in light of the
circumstances then existing. If any Claim is instituted by or against a third
party with respect to which any Indemnified Party intends to claim any Damages,
such Indemnified Party shall promptly notify the Indemnifying Party of such
Claim. The notice provided by the Indemnified Party to the Indemnifying Party
shall describe the Claim (the "Asserted Liability") in reasonable detail and
shall indicate the amount (estimated, if necessary, and to the extent feasible)
of the Damages that have been or may be suffered by the Indemnified Party. The
failure of an Indemnified Party to give any notice required by this Section
shall not affect any of such Party's rights under this Article IX or otherwise
except and to the extent that such failure is prejudicial to the rights or
obligations of the Indemnifying Party or to the Indemnifying Party's ability to
defend against such Asserted Liability.
9.5 Opportunity to Defend Third Party Claims . The Indemnifying Party may elect
to defend, at its own expense and with its own counsel reasonably satisfactory
to the Indemnified Party, any Asserted Liability, but only if: (a) the
Indemnifying Party notifies the Indemnified Party in writing within thirty (30)
days after the Indemnified Party has given notice of the Asserted Liability
that the Indemnifying Party will indemnify the Indemnified Party from and
against the entirety of any Damages the Indemnified Party may suffer resulting
from, arising out of, relating to, in the nature of, or caused by the Asserted
Liability; (b) the Indemnifying Party provides the Indemnified Party with
evidence reasonably acceptable to the Indemnified Party that the Indemnifying
Party will have the financial resources to defend against the Asserted
Liability and fulfill its indemnification obligations hereunder; (c) the
Asserted Liability involves only money damages and does not seek an injunction
or other equitable relief; (d) settlement of, or an adverse judgment with
respect to, the Asserted Liability is not, in the good faith judgment of the
Indemnified Party, likely to establish a precedential custom or practice
adverse to the continuing business interests of the Indemnified Party; (e) the
Indemnifying Party conducts the defense of the Asserted Liability actively and
diligently; and (f) the Indemnified Party shall have reasonably concluded that:
(i) there is no conflict of interest between the Indemnified Party and the
Indemnifying Party in the conduct of such defense; and
(ii) the Indemnified Party shall have no defenses that are not available to the
Indemnifying Party. If the Indemnifying Party elects to defend such Asserted
Liability, it shall within thirty (30) days (or sooner, if the nature of the
Asserted Liability so requires) notify the Indemnified Party of its intent to
do so, and the Indemnified Party shall cooperate, at the expense of the
Indemnifying Party, in the defense of such Asserted Liability. If the
Indemnifying Party elects not to defend the Asserted Liability, is not
permitted defend the Asserted Liability by reason of the first sentence of this
Section 9.5, fails to notify the Indemnified Party of its election as herein
provided or contests its obligation to indemnify under this Agreement with
respect to such Asserted Liability, the Indemnified Party may pay, compromise
or defend such Asserted Liability at the sole cost and expense of the
Indemnifying Party if determined to be liable to the Indemnified Party
hereunder. In any event, the Indemnified Party and the Indemnifying Party may
participate, at their own expense, in the defense of such Asserted Liability.
If the Indemnifying Party chooses to defend any Asserted Liability, the
Indemnified Party shall make available to the Indemnifying Party any books,
records or other documents within its control that are necessary or appropriate
for such defense. Any expenses of any Indemnified Party for which
indemnification is available hereunder shall be paid upon written demand
therefor.
9.6 Indemnity Payments . In the event that Purchaser agrees to or is
determined to have an obligation to reimburse any Seller Indemnitee for Damages
as provided in this Article IX, Purchaser shall promptly pay such amount to
such Seller Indemnitee via wire transfer of immediately available funds to an
account specified by such Seller Indemnitee in writing. In the event that
Seller agrees to or is determined to have an obligation to reimburse any
Purchaser Indemnitee for Damages as provided in this Article IX, Seller shall
promptly pay such amount to such Purchaser Indemnitee via wire transfer of
immediately available funds to an account specified by such Purchaser
Indemnitee in writing.
9.7 Limitations on Liability . Anything to the contrary in this Agreement
notwithstanding:
(a) no Purchaser Indemnitee shall make a Claim against any Seller Indemnitee
for indemnification pursuant to this Article IX for Damages unless and until
the aggregate amount of all Damages of all Purchaser Indemnitees shall exceed
$150,000 (the "Indemnification Basket"); and then Purchaser Indemnitees shall
only be permitted to recover from Seller Indemnitees Damages that Purchaser
Indemnitees shall have incurred which are in excess of the Indemnification
Basket; provided, however, that any Damages arising from, or relating to,
Claims made under Sections 9.2(iii), (iv), (v) and (vi) shall not be subject
to, or limited by, the Indemnification Basket;
(b) Seller shall not be obligated to indemnify Purchaser Indemnitees for
Damages arising from, or relating to, Claims made under Section 9.2, which
exceed, in the aggregate, $5,000,000 (the "Indemnification Cap"); provided
that (and notwithstanding anything to the contrary herein) the Indemnification
Cap for Damages arising from, or relating to, Claims made under Section 9.2,
for breaches of Section 3.8 with respect to title and or rights in respect to
the Purchased Assets, Perry Leased Real Property, Perry Leased Equipment,
Wastewater Facility Leased Real Property, Wastewater Facility Leased Assets
and the Leased Garage shall be the Purchase Price; provided further that the
Indemnification Cap shall not apply to any Damages arising from, or relating
to, Claims (i) made under Sections 9.2(iii), (iv), (v) and (vi) and (ii)
Claims for Damages resulting from intentional fraud or willful misconduct; and
(c) Purchaser acknowledges and agrees that (i) neither Seller nor any of its
Affiliates, agents or Representatives is making or has made any representation
or warranty regarding the Purchased Assets or the Business, other than those
set forth in Article III of this Agreement or the Schedules thereto, and (ii)
in acquiring the Purchased Assets, Purchaser is not relying on any statement,
representation or warranty by any Person regarding the Purchased Assets or the
Business other than the representations and warranties set forth in said
Article III and the Schedules hereto.
(d) In the event that Seller shall fail to complete the work required under
Section 8.1 and Purchaser completes such work, the maximum amount that Seller
shall be required to indemnify Purchaser therefor shall be the difference
between (i) the actual costs incurred by Purchaser to complete such work less
(ii) the portion, if any, of the Contingent Purchase Price that has not been
paid to Seller.
9.8 Exclusive Remedies . If the Closing occurs, then the remedies provided in
this Article IX shall constitute the sole and exclusive remedies for recoveries
by a Party (or any other Person who is a Purchaser Indemnitee or a Seller
Indemnitee) against any other Party (or a Person who is a Purchaser Indemnitee
or a Seller Indemnitee, as the case may be) for breaches of the
representations, warranties, convenants and agreements contained in this
Agreement (including for the matters specifically listed in this Article IX as
being subject to indemnification); provided, however, that neither the
foregoing nor anything else in this Agreement will limit the right of any
Person to enforce the performance (i) of this Agreement or (ii) of any
contract, document or other instrument executed and delivered pursuant to this
Agreement, by any remedy available to it in equity.
ARTICLE X. GENERAL
10.1 Notices. All notices, requests, claims, demands or other communications
that are required or may be given pursuant to the terms of this Agreement shall
be in writing and shall be deemed to have been duly given (a) when delivered,
if delivered by hand, (b) one Business Day after transmitted, if transmitted by
a nationally recognized overnight courier service, (c) when telecopied, if
telecopied (which is confirmed), or (d) three Business Days after mailing, if
mailed by registered or certified mail (return receipt requested), to the party
to whom given or sent at the following address of such party (or to such other
address as such party may have specified in a notice given in accordance with
this Section 10.1):
(a) If to Purchaser:
▇▇▇▇▇▇ Farms Incorporated
▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: J. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
President and General Manager, Retail Division
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
With a simultaneous copy to:
▇▇▇▇▇▇ Farms Incorporated
▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, Esq.
General Counsel
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
(b) If to Seller:
▇▇▇▇▇'▇, Inc.
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇.▇.
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: J. ▇▇▇▇▇▇▇ ▇▇▇▇▇
Chairman and Chief Executive Officer
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
With simultaneous copies to:
▇▇▇▇▇, ▇▇▇▇▇ & ▇▇▇▇▇, ▇.▇.
▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇ 100
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇.▇.
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇, Esq.
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇ LLP
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇.▇.
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇, Esq.
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
; provided, however, that the failure to give notice to any Person designated
above as a Person to be copied with respect to such notice shall not invalidate
a notice otherwise properly given to a Party hereto.
10.2 Severability; Parties in Interest . If any provision of this Agreement
for any reason shall be held to be illegal, invalid or unenforceable, such
illegality shall not affect any other provision of this Agreement, but this
Agreement shall be construed as if such illegal, invalid or unenforceable
provision had never been included herein. Except as provided in Article IX
hereof with respect to Purchaser Indemnitees and Seller Indemnitees, nothing in
this Agreement, express or implied, is intended to confer upon any Person not a
Party to this Agreement any rights or remedies of any nature whatsoever under
or by reason of this Agreement.
10.3 Assignment; Binding Effect; Benefit . Neither this Agreement nor any of
the rights, interests or obligations hereunder shall be assigned by any Party
(whether by operation of Law or otherwise) without the prior written consent of
the other Parties except that Purchaser shall be permitted to assign its rights
, interests and obligations to an Affiliate of Purchaser without obtaining any
consent from the other Parties. Any purported assignment, unless so consented
to or permitted as provided herein, shall be void and without effect. Subject
to the foregoing, this Agreement shall be binding upon and shall inure to the
benefit of the Parties and their respective successors and permitted assigns.
Notwithstanding anything contained in this Agreement to the contrary, nothing
in this Agreement, expressed or implied, is intended to confer on any Person
other than the Parties or their respective successors and permitted assigns any
rights or remedies under or by reason of this Agreement.
10.4 Incorporation of Exhibits and Schedules . All Exhibits and Schedules
attached hereto and referred to herein are hereby incorporated herein and made
a part of this Agreement for all purposes as if fully set forth herein.
10.5 Governing Law . THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED AND
ENFORCED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF GEORGIA OTHER THAN
CONFLICT OF LAWS PRINCIPLES THEREOF DIRECTING THE APPLICATION OF ANY LAW OTHER
THAN THAT OF GEORGIA.
10.6 Arbitration . Any dispute or disagreement which may arise under or
pursuant to this Agreement or with respect to the transactions contemplated
hereby (including any claims by any Person for indemnification hereunder
pursuant to Article IX hereof) shall be settled by final, binding and
conclusive arbitration. Any such arbitration shall be conducted (i) in
Atlanta, Georgia by a single arbitrator agreed upon by the parties of such
arbitration, or if such parties cannot so agree, appointed by the Atlanta
office of the American Arbitration Association ("AAA") and (ii) pursuant to
AAA's Commercial Arbitration Rules, provided that such parties shall have the
right to discovery pursuant to the Federal Rules of Civil Procedure.
10.7 Headings; Interpretation. The descriptive headings contained in this
Agreement are included for convenience of reference only and shall not affect
in any way the meaning or interpretation of this Agreement. The Parties have
participated jointly in the negotiation and drafting of this Agreement. In the
event an ambiguity or question of intent or interpretation arises, this
Agreement shall be construed as if drafted jointly by the Parties, and no
presumption or burden of proof shall arise favoring or disfavoring any Party by
virtue of the authorship of any provisions of this Agreement.
10.8 Counterparts . This Agreement may be executed and delivered (including by
facsimile transmission) in one or more counterparts, and by the different
parties hereto in separate counterparts, each of which when executed and
delivered shall be deemed to be an original but all of which taken together
shall constitute one and the same agreement.
10.9 Entire Agreement . This Agreement (including the Schedules and Exhibits
attached hereto) and the Transaction Documents executed in connection with the
consummation of the Acquisition contain the entire agreement between the
Parties with respect to the subject matter hereof and related transactions and
supersede all prior agreements, written or oral, with respect thereto.
10.10 Waivers and Amendments; Non-Contractual Remedies; Preservation of
Remedies . This Agreement may be amended, superseded, canceled, renewed or
extended only by a written instrument signed by all of the Parties. The
provisions hereof may be waived only in writing signed by all of the Parties.
No delay on the part of any Party in exercising any right, power or privilege
hereunder shall operate as a waiver thereof, nor shall any waiver on the part
of any Party of any such right, power or privilege, nor any single or partial
exercise of any such right, power or privilege, preclude any further exercise
thereof or the exercise of any other such right, power or privilege. Except as
otherwise provided herein, the rights and remedies herein provided are
cumulative and are not exclusive of any rights or remedies that any Party may
otherwise have at Law or in equity.
[Signatures appear on next page]
IN WITNESS WHEREOF, intending to be legally bound hereby, the Parties have
caused this Agreement to be signed in their respective names by their duly
authorized representatives as of the date first above written.
ATTEST: ▇▇▇▇▇▇ FARMS INCORPORATED
▇.▇▇▇▇▇▇▇▇, ▇▇. By: /s/ J. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Assistant Secretary Name: J. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Title: President & General Manager Retail
Division
▇▇▇▇▇'▇, INC.
▇▇▇▇▇▇ ▇. ▇▇▇▇▇ By: /s/ J. ▇▇▇▇▇▇▇ ▇▇▇▇▇
Secretary Name: J. ▇▇▇▇▇▇▇ ▇▇▇▇▇
Title: Chairman
▇▇▇▇▇'▇ FARMS, INC.
▇▇▇▇▇▇ ▇. ▇▇▇▇▇ By: /s/ J. ▇▇▇▇▇▇▇ ▇▇▇▇▇
Secretary Name: J. ▇▇▇▇▇▇▇ ▇▇▇▇▇
Title: Chairman
Schedule 5.11
Pre-Closing Projects
? Processing Plant Drains - clear and working properly, at Closing and for
thirty (30) days thereafter
? Processing Plant Line 2 - IQF - repairs completed; working order and
condition, at Closing and for thirty (30) days thereafter
? Processing Plant Line 3 - IQF - any parts that were in maintenance inventory
to repair or replace missing parts have been reinstalled; any leased items in
Line 3 - IQF are in working order and condition at Closing and for thirty (30)
days thereafter
? Processing Plant - Sanitation Hotwater - repairs completed; working order and
condition, at Closing and for thirty (30) days thereafter
? Hatchery Setters - Nine (9) sets of racks and flats per setter, at Closing
? Live Haul Cages - working doors; working order and condition, at Closing
? Whole bird injection at Processing Plant - repairs completed; working order
and condition, at Closing and for thirty (30) days thereafter
? Processing Plant - DSI - Verification of previously completed DSI upgrade
within 72 hours of Closing; working order and condition, at Closing and for
thirty (30) days thereafter
Schedule 8.1
Post-Closing Projects.
1. Prior to the first anniversary of the Closing Date, Seller shall have
completed, in full compliance with Section 8.1 and as set forth in this
Schedule 8.1, the following:
(a) Post-Closing Asbestos Project - Brew House Area
(i) the remediation and removal of all asbestos located within the building
known as the "brew house" and the related structures in the brew house area
(ii) remediation shall include removal of asbestos and other debris from the
real property and restoration of the brew house area
(iii) off site disposal of asbestos and other debris
(b) Post-Closing Asbestos Project - Tank Buildings
(i) the remediation and removal of all asbestos located within the buildings
known as the "tank buildings"
(ii) remediation shall include removal of asbestos and other debris from the
real property and restoration of the tank buildings
(iii) off site disposal of asbestos and other debris
(c) Post-Closing Brew House Project
(i) removal of all contents from within the building known as the "brew house"
and removal of all sheds, harvest stores and other related structures in the
brew house area
(ii) off site disposal of all debris
(d) Post-Closing Tank Project
(i) the removal of all tanks from the buildings known as the "tank buildings"
and repair of any damage caused by such removal
(ii) remediation shall include reasonable restoration of the tank buildings
after removal of tanks
(3) off site disposal of all debris
(5) Post-Closing Landfill Closure Project
(i) the closure of the inert debris landfill referenced in the letter of March
30, 1999 from Seller to the Georgia Department of Natural Resources in
compliance with all applicable laws, including Environmental Laws
2. Seller shall consult with Purchaser on the selection of the contractor and
the work plan. Seller shall comply with such work plan.
3. All Post-Closing Project work shall be done in compliance with all
applicable laws, codes, ordinances, rules, regulations and statutes, including
Environmental Laws, by persons having all required licenses, training,
approvals and permits. Seller shall use experienced and capable personnel to
perform the Post-Closing Projects.
4. Purchaser shall have received a certificate or such other document
evidencing satisfactory remediation of each Post-Closing Project. Post-Closing
Projects are also subject to Purchaser's inspection and reasonable
satisfaction.
5. All Post-Closing Project work shall be performed in a good, workmanlike and
safe manner consistent with the highest industry standards applicable to
providers of such services.
6. Seller warrants the Post-Closing Projects shall be performed and completed
in accordance and compliance with Section 8.1 and this Schedule 8.1, and that
upon completion the Post-Closing Projects shall be free from any defects in
workmanship or material.
7. Purchaser, at its cost, may have an on-site representative observe the
selected contractor's completion of the Post-Closing Projects.
8. Seller, with cooperation of Purchaser, shall obtain all licenses,
permissions, consents or releases required in connection with the performance
of the Post-Closing Projects.
9. Seller may use an area of the real property designated by Purchaser to store
salvageable equipment and items removed in connection with the remediation
projects described in this Schedule for a maximum period of 12 months.
10. At such time as Seller shall be able to demonstrate to Purchaser's
reasonable satisfaction that Seller shall have completed 25% of the work
required to be performed by Seller pursuant to Item 1, Purchaser shall release
to Seller $250,000 of the Contingent Purchase Price. A second and third
$250,000 shall be so released upon Seller's similar completion of each of 50%
and 75% of such work, respectively; and the remaining $250,000 shall be
released upon Seller's final completion to Purchaser's reasonable satisfaction
of all such work. Notwithstanding anything to the contrary herein, no such
progress payments will be made until the full completion and satisfaction of
the remedial work referenced in Item 1(a) above..