EXECUTION COPY
AGREEMENT AND PLAN OF REORGANIZATION
BY AND BETWEEN
RALCORP HOLDINGS, INC.
AND
AGRIBRANDS INTERNATIONAL, INC.,
DATED AS OF
AUGUST 7, 2000
TABLE OF CONTENTS
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PAGE
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ARTICLE I. FORMATION OF HOLDING COMPANY AND SUBSIDIARIES 1
1.1. Organization of Holding Company. 1
1.2. Directors and Officers of Holding Company. 1
1.3. Organization of Merger Subsidiaries. 2
1.4. Actions of Agribrands, Ralcorp and Holding Company. 2
ARTICLE II. THE MERGERS; CLOSING 2
2.1. The Mergers. 2
2.2. Directors and Officers. 3
2.3. Certificate of Incorporation and Bylaws. 3
ARTICLE III. EFFECT OF THE MERGERS ON SECURITIES OF AGRIBRANDS, RALCORP
AND THE MERGER SUBSIDIARIES 4
3.1. Conversion of Merger Subsidiaries Stock. 4
3.2. Cancellation of Holding Company Capital Stock. 4
3.3. Conversion of Common Stock. 4
3.4. Surrender and Payment. 6
3.5. Options. 9
3.6. Fractional Shares. 9
3.7. Withholding Rights. 9
ARTICLE IV. REPRESENTATIONS AND WARRANTIES OF AGRIBRANDS 10
4.1. Organization and Good Standing. 10
4.2. Capitalization. 10
4.3. Subsidiaries. 11
4.4. Authorization; Binding Agreement. 11
4.5. Governmental Approvals. 11
4.6. No Violations. 12
4.7. Securities Filings and Litigation. 12
4.8. Agribrands Financial Statements. 13
4.9. Absence of Certain Changes or Events. 13
4.10. Related Party Transactions. 14
4.11. Compliance with Laws. 14
4.12. Permits. 14
4.13. Finders and Investment Bankers. 14
4.14. Material Contracts. 14
4.15. Employee Benefit Plans. 15
4.16. Taxes and Returns. 17
4.17. No Adverse Actions. 18
4.18. Fairness Opinions. 19
4.19. Takeover Statutes and Charter. 19
4.20. Agribrands Rights Plan. 19
ARTICLE V. REPRESENTATIONS AND WARRANTIES OF RALCORP 19
5.1. Organization and Good Standing. 19
5.2. Capitalization. 20
5.3. Subsidiaries. 20
5.4. Authorization; Binding Agreement. 21
5.5. Governmental Approvals. 21
5.6. No Violations. 21
5.7. Securities Filings and Litigation. 22
5.8. Ralcorp Financial Statements. 22
5.9. Absence of Certain Changes or Events. 23
5.10. Related Party Transactions. 23
5.11. Compliance with Laws. 23
5.12. Permits. 23
5.13. Finders and Investment Bankers. 24
5.14. Material Contracts. 24
5.15. Employee Benefit Plans. 24
5.16. Taxes and Returns. 25
5.17. No Adverse Actions. 26
5.18. Fairness Opinion. 26
5.19. Takeover Statutes and Charter. 26
5.20. Ralcorp Rights Plan. 27
ARTICLE VI. ADDITIONAL COVENANTS OF AGRIBRANDS 27
6.1. Conduct of Business of Agribrands and the Agribrands Subsidiaries. 27
6.2. Notification of Certain Matters. 29
6.3. Access and Information. 29
6.4. Shareholder Approval. 30
6.5. Reasonable Best Efforts. 30
6.6. Public Announcements. 31
6.7. Compliance. 31
6.8. Tax Treatment. 31
6.9. Agribrands Benefit Plans. 31
6.10. No Solicitation of Acquisition Proposal. 31
6.11. SEC and Shareholder Filings. 33
6.12. Affiliate Agreements. 33
6.13. Takeover Statutes. 33
6.14. Comfort Letters. 33
ARTICLE VII. ADDITIONAL COVENANTS OF RALCORP 34
7.1. Conduct of Business of Ralcorp and the Ralcorp Subsidiaries. 34
7.2. Notification of Certain Matters. 36
7.3. Access and Information. 36
7.4. Shareholder Approval. 37
7.5. Reasonable Best Efforts. 37
7.6. Public Announcements. 37
7.7. Compliance. 38
7.8. Tax Treatment. 38
7.9. Ralcorp Benefit Plans. 38
7.10. No Solicitation of Acquisition Proposal. 38
7.11. SEC and Shareholder Filings. 39
7.12. Affiliate Agreements. 40
7.13. Takeover Statutes. 40
7.14. Comfort Letters. 40
ARTICLE VIII. ADDITIONAL COVENANTS OF AGRIBRANDS AND RALCORP
WITH RESPECT TO HOLDING COMPANY 40
8.1. Director and Officer Liability. 40
8.2. Listing of Stock. 41
8.3. Registration Statement; Prospectus/Proxy Statement. 42
8.4. Tax Treatment. 43
8.5. Shareholder Rights Agreement. 43
ARTICLE IX. CONDITIONS 43
9.1. Conditions to Each Party's Obligations. 43
9.1.1. Shareholder Approvals. 43
9.1.2. No Injunction or Action. 43
9.1.3. Governmental Approvals. 43
9.1.4. HSR Act. 44
9.1.5. Required Consents. 44
9.1.6. Registration Statement. 44
9.1.7. Spin-Off Covenant. 44
9.1.8. Tax Opinion. 45
9.1.9. Dissenting Shares. 45
9.1.10. Holding Company Acts. 45
9.2. Conditions to Obligations of Agribrands. 45
9.2.1. Ralcorp Representations and Warranties. 45
9.2.2. Performance by Ralcorp. 45
9.2.3. No Material Adverse Change. 45
9.2.4. Certificates and Other Deliveries. 46
9.2.5. Opinion of Ralcorp Counsel. 46
9.3. Conditions to Obligations of Ralcorp. 46
9.3.1. Agribrands Representations and Warranties. 46
9.3.2. Performance by Agribrands. 46
9.3.3. No Material Adverse Change. 46
9.3.4. Certificates and Other Deliveries. 47
9.3.5. Opinion of Agribrands Counsel. 47
ARTICLE X. TERMINATION AND ABANDONMENT 47
10.1. Termination. 47
10.2. Effect of Termination. 48
ARTICLE XI. MISCELLANEOUS 50
11.1. Confidentiality. 50
11.2. Amendment and Modification. 51
11.3. Waiver of Compliance; Consents. 51
11.4. Survival of Representations and Warranties. 51
11.5. Notices. 51
11.6. Binding Effect; Assignment. 53
11.7. Expenses. 53
11.8. Governing Law. 53
11.9. Counterparts. 53
11.10. Interpretation. 53
11.11. Entire Agreement. 53
11.12. Specific Performance. 54
11.13. Third Parties. 54
GLOSSARY OF DEFINED TERMS
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PAGE WHERE
TERM DEFINED
Affiliate 53
Agreement 1
Agribrands 1
Agribrands Acquisition Proposal 32
Agribrands Ancillary Agreements 11
Agribrands Cash Consideration 4
Agribrands Cash Election 4
Agribrands Common Stock 4
Agribrands Dissenting Shares 5
Agribrands Financial Statements 13
Agribrands Holders 7
Agribrands Material Adverse Effect 10
Agribrands Material Contract 15
Agribrands Merger 2
Agribrands Merger Agreement 2
Agribrands Merger Consideration 4
Agribrands Options 9
Agribrands Permits 14
Agribrands Preferred Stock 10
Agribrands Proposals 30
Agribrands Rights Agreement 19
Agribrands Securities Filings 13
Agribrands Shareholders Meeting 30
Agribrands Stock Consideration 4
Agribrands Stock Election 4
Agribrands Subsidiaries 10
Agribrands Superior Proposal 32
Agribrands Termination Fee 48
Articles of Merger 3
Benefit Plan 15
Cash Election 5
Certificates 5
Closing 3
Closing Date 3
Consent 11
Continuing Directors 19
Dissenting Shares 5
Effective Time 3
Election Deadline 6
Election Form 6
Enforceability Exceptions 11
ERISA 15
Event 13
Exchange Agent 6
Exchange Fund 6
Final Order 44
Form S-4 42
Governmental Authority 12
Holding Company 1
Holding Company Common Stock 1
Holding Company Material Adverse Effect 44
HSR Act 12
Indemnified Losses 41
Indemnified Person 40
IRS 12
Law 12
Litigation 13
Merger Agreements 2
Merger Consideration 5
Merger Sub A 2
Merger Sub R 2
Merger Subsidiaries 2
Mergers 1, 3
Missouri Code 2
Multi-Employer Plan 15
New Agribrands Options 9
New Ralcorp Options 9
NYSE 12
person 53
Proxy Statement/Prospectus 42
Ralcorp 1
Ralcorp Acquisition Proposal 39
Ralcorp Ancillary Agreements 21
Ralcorp Cash Consideration 5
Ralcorp Cash Election 5
Ralcorp Common Stock 5
Ralcorp Dissenting Shares 5
Ralcorp Financial Statements 22
Ralcorp Holders 7
Ralcorp Material Adverse Effect 20
Ralcorp Material Contract 24
Ralcorp Merger 3
Ralcorp Merger Agreement 2
Ralcorp Merger Consideration 5
Ralcorp Options 9
Ralcorp Permits 23
Ralcorp Preferred Stock 20
Ralcorp Proposals 37
Ralcorp Rights Agreement 27
Ralcorp Securities Filings 22
Ralcorp Shareholders Meeting 37
Ralcorp Stock Consideration 5
Ralcorp Stock Election 5
Ralcorp Subsidiaries 19
Ralcorp Superior Proposal 39
Ralcorp Termination Fee 49
▇▇▇▇▇▇▇ Purina 33
Reorganization 1
Stock Election 5
subsidiary 53
Takeover Statute 19
AGREEMENT AND PLAN OF REORGANIZATION
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This Agreement and Plan of Reorganization (the "Agreement") is made and
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entered into as of August 7, 2000, by and between Ralcorp Holdings, Inc., a
Missouri corporation ("Ralcorp") and Agribrands International, Inc., a Missouri
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corporation ("Agribrands").
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Recitals
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A. The respective Special Committees of the Boards of Directors of
Agribrands and Ralcorp have recommended and the Boards of Directors of
Agribrands and Ralcorp have approved and deem it advisable and in the best
interests of their respective companies and shareholders to consummate the
reorganization (the "Reorganization") provided for herein, pursuant to which a
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newly formed holding company ("Holding Company"), will acquire all of the common
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stock of each of Agribrands and Ralcorp through mergers of separate subsidiaries
of Holding Company with and into each of Agribrands and Ralcorp (the "Mergers").
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Upon consummation of the Reorganization, the shareholders of each of Agribrands
and Ralcorp will become shareholders of Holding Company.
B. For federal income tax purposes, it is intended that (i) the Ralcorp
Merger qualify as a reorganization described in Section 368(a) of the United
States Internal Revenue Code of 1986, as amended (the "Code"), or, taken
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together with the Agribrands Merger, qualifies as an exchange described in
Section 351(a) of the Code and (ii) the Agribrands Merger qualify as a
reorganization described in Section 368(a) of the Code or , taken together with
the Ralcorp Merger, qualifies as an exchange described in Section 351(a) of the
Code.
C. Agribrands and Ralcorp desire to make certain representations,
warranties, covenants and agreements in connection with the Mergers.
NOW, THEREFORE, in consideration of the foregoing, and of the representations,
warranties, covenants and agreements contained herein, the parties hereto agree
as follows:
ARTICLE I
FORMATION OF HOLDING COMPANY AND SUBSIDIARIES
1.1. ORGANIZATION OF HOLDING COMPANY.
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As promptly as practicable following the execution of this Agreement,
Agribrands and Ralcorp will cause Holding Company to be organized under Missouri
law. The authorized capital stock of Holding Company will consist of 100 shares
of common stock, par value $ 0.01 per share (the "Holding Company Common
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Stock").
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1.2. DIRECTORS AND OFFICERS OF HOLDING COMPANY.
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Agribrands and Ralcorp agree that the directors of Holding Company will be
as set forth on Schedule 1.2 attached hereto and the officers of Holding Company
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will be as the Holding Company Board of Directors shall determine.
1.3. ORGANIZATION OF MERGER SUBSIDIARIES.
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As promptly as practicable following the execution of this Agreement,
Agribrands and Ralcorp shall cause the following companies to be organized for
the sole purpose of effectuating the Agribrands Merger and the Ralcorp Merger
contemplated herein:
(i) Holding Company Subsidiary A, a corporation organized under the
laws of the State of Missouri ("Merger Sub A"). The authorized capital stock of
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Merger Sub A shall initially consist of 100 shares of common stock, $.01 par
value per share, one share of which shall be issued to Holding Company at a
price of $1.00. Holding Company shall own directly all of the outstanding
capital stock of Merger Sub A.
(ii) Holding Company Subsidiary R, a corporation organized under the
laws of the State of Missouri ("Merger Sub R" and, together with Merger Sub A,
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the "Merger Subsidiaries"). The authorized capital stock of Merger Sub R shall
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initially consist of 100 shares of common stock, par value $.01 per share, one
share of which shall be issued to Holding Company at a price of $1.00. Holding
Company shall own directly all of the outstanding capital stock of Merger Sub R.
1.4. ACTIONS OF AGRIBRANDS, RALCORP AND HOLDING COMPANY.
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As promptly as practicable following the execution of this Agreement,
Agribrands and Ralcorp shall cause (i) Holding Company to elect the directors of
the Merger Subsidiaries, (ii) the directors of Merger Sub A and Merger Sub R to
elect their respective officers, (iii) the directors of Holding Company to
ratify and approve this Agreement and to approve the forms of the Merger
Agreements (as hereinafter defined), (iv) the directors and officers of the
Merger Subsidiaries to take such steps as may be necessary or appropriate to
complete the organization of the Merger Subsidiaries and to approve the Merger
Agreements; and (v) the Merger Agreements to be executed on behalf of the
parties thereto.
ARTICLE II.
THE MERGERS; CLOSING
2.1. THE MERGERS.
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Pursuant to plans of merger, each in substantially the form attached hereto
as Exhibit A (sometimes hereinafter referred to individually as the "Agribrands
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Merger Agreement" and the "Ralcorp Merger Agreement," respectively, and
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collectively as the "Merger Agreements"), upon the terms and subject to the
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conditions set forth in this Agreement and in the Merger Agreements:
(a) Merger Sub A shall be merged with and into Agribrands (the
"Agribrands Merger") in accordance with the applicable provisions of the General
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and Business Corporation Law of Missouri (the "Missouri Code"). Agribrands
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shall be the surviving corporation in the Agribrands Merger and shall continue
its corporate existence under the laws of the State of Missouri. As a result of
the Agribrands Merger, Agribrands shall become a direct, wholly owned Subsidiary
of Holding Company. The effects and consequences of the Agribrands Merger shall
be as set forth in the Agribrands Merger Agreement.
(b) Merger Sub R will be merged with and into Ralcorp (the "Ralcorp
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Merger"), in accordance with the applicable provisions of the Missouri Code.
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Ralcorp shall be the surviving corporation in the Ralcorp Merger and shall
continue its corporate existence under the laws of the State of Missouri. As a
result of the Ralcorp Merger, Ralcorp shall become a direct, wholly owned
Subsidiary of Holding Company. The effects and consequences of the Ralcorp
Merger shall be as set forth in the Ralcorp Merger Agreement. The term
"Mergers" shall mean, collectively, the Agribrands Merger and the Ralcorp
Merger.
(c) Subject to the terms and conditions of this Agreement, the closing
of the Mergers (the "Closing") shall take place (a) at the offices of ▇▇▇▇▇ ▇▇▇▇
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LLP, One ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇, ▇▇. ▇▇▇▇▇, ▇▇▇▇▇▇▇▇, at 10:00 a.m.
local time, on the fifth Business Day following the day on which the last to be
fulfilled or waived of the conditions set forth in Article IX (excluding
conditions that, by their terms cannot be satisfied until the Closing Date, but
subject to the fulfillment or waiver of such conditions) shall be fulfilled or
waived in accordance herewith or (b) at such other time, date or place as
Agribrands and Ralcorp may agree. The date on which the Closing occurs is
hereinafter referred to as the "Closing Date."
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(d) As soon as practicable following the Closing, the parties shall (i)
file articles of merger with respect to each of the Mergers (the "Articles of
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Merger") in such form as is required by and executed in accordance with the
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Missouri Code and (ii) make all other filings or recordings required under the
laws of Missouri. The Mergers shall become effective at such time and date (the
"Effective Time") which is the later of (i) the date and time of the filing of
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the Articles of Merger with respect to the Agribrands Merger (or such other date
and time as may be specified in such certificate as may be permitted by the
Missouri Code) and (ii) the date and time of the filing of the Articles of
Merger with respect to the Ralcorp Merger (or such other date and time as may be
specified in such certificate as may be permitted by the Missouri Code).
(e) The consummation of the Agribrands Merger shall be conditioned on
the simultaneous consummation of the Ralcorp Merger, and the consummation of the
Ralcorp Merger shall be conditioned on the simultaneous consummation of the
Agribrands Merger.
2.2. DIRECTORS AND OFFICERS.
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The directors and officers of Merger Sub A and Merger Sub R immediately
prior to the Effective Time shall be the directors and officers of the surviving
corporations of the Agribrands Merger and the Ralcorp Merger, respectively, as
of the Effective Time and until their successors are duly appointed or elected
in accordance with the laws of Missouri or until their earlier death,
resignation or removal.
2.3. CERTIFICATE OF INCORPORATION AND BYLAWS.
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The articles of incorporation and bylaws of Merger Sub A and Merger Sub R
immediately prior to the Effective Time shall be the articles of incorporation
and bylaws of the surviving corporation of the Agribrands Merger and the Ralcorp
Merger, respectively, as of the Effective Time.
ARTICLE III.
EFFECT OF THE MERGERS ON SECURITIES OF AGRIBRANDS, RALCORP
AND THE MERGER SUBSIDIARIES
3.1 CONVERSION OF MERGER SUBSIDIARIES STOCK.
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At the Effective Time, by virtue of the Agribrands Merger and without any
action on the part of any of the parties, each share of the common stock of
Merger Sub A outstanding immediately prior to the Effective Time shall be
converted into and shall become one share of common stock of the surviving
corporation of the Agribrands Merger. At the Effective Time, by virtue of the
Ralcorp Merger and without any action on the part of any of the parties, each
share of the common stock of Merger Sub R outstanding immediately prior to the
Effective Time shall be converted into and shall become one share of common
stock of the surviving corporation of the Ralcorp Merger.
3.2. CANCELLATION OF HOLDING COMPANY CAPITAL STOCK.
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At the Effective Time, the shares of the capital stock of Holding Company
issued and outstanding immediately prior to the Effective Time shall be canceled
and cease to exist.
3.3. CONVERSION OF COMMON STOCK.
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(a) Subject to the provisions of this Agreement, at the Effective
Time each issued and outstanding share of common stock, par value $.01 per
share, of Agribrands together with the associated rights issued pursuant to the
Agribrands Rights Agreement (as hereinafter defined) (the "Agribrands Common
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Stock"), shall be converted into, at the election of the holder thereof, one of
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the following (as may be adjusted pursuant to Section 3.3(e), the "Agribrands
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Merger Consideration"):
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(i) for each such share of Agribrands Common Stock with respect to
which an election to receive cash has been effectively made and not revoked or
lost, pursuant to Section 3.3(c) and (d) (the "Agribrands Cash Election"), the
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right to receive in cash from Holding Company, without interest, an amount equal
to $39.00 (the "Agribrands Cash Consideration");
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(ii) for each such share of Agribrands Common Stock (other than
shares as to which an Agribrands Cash Election has been made) ("Agribrands Stock
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Election"), the right to receive three (3) shares of Holding Company Common
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Stock (the "Agribrands Stock Consideration").
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(b) Subject to the provisions of this Agreement, at the Effective Time
each issued and outstanding share of common stock, par value $.01 per share, of
Ralcorp together with the associated rights issued pursuant to the Ralcorp
Rights Agreement (as hereinafter defined) (the "Ralcorp Common Stock"), shall be
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converted into, at the election of the holder thereof, one of the following (as
may be adjusted pursuant to Section 3.3(e), the "Ralcorp Merger Consideration",
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together with Agribrands Merger Consideration, the "Merger Consideration"):
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(i) for each such share of Ralcorp Common Stock with respect to
which an election to receive cash has been effectively made and not revoked or
lost, pursuant to Section 3.3(c) and (d) (the "Ralcorp Cash Election", together
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with Agribrands Cash Election, the "Cash Election"), the right to receive in
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cash from Holding Company, without interest, an amount equal to $15.00 (the
"Ralcorp Cash Consideration").
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(ii) for each such share of Ralcorp Common Stock (other than
shares as to which a Ralcorp Cash Election has been made) (a "Ralcorp Stock
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Election", together with Agribrands Stock Election, the "Stock Election"), the
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right to receive one (1) share of Holding Company Common Stock (the "Ralcorp
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Stock Consideration");
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(c) As a result of the Agribrands Merger and the Ralcorp Merger and
without any action on the part of the holder thereof, at the Effective Time all
shares of Agribrands Common Stock and Ralcorp Common Stock shall cease to be
outstanding and shall be canceled and retired and shall cease to exist, and each
holder of shares of Agribrands Common Stock and Ralcorp Common Stock shall
thereafter cease to have any rights with respect to such shares of Agribrands
Common Stock and Ralcorp Common Stock, except the right to receive, without
interest, the applicable Merger Consideration and cash for fractional shares in
accordance with Section 3.6 upon the surrender of a certificate or an election
form by Agribrands shareholders holding stock in book-entry form representing
such shares of Agribrands Common Stock and/or Ralcorp Common Stock (the
"Certificates"). To the extent that objecting shareholders' rights are
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available under Section 351.455 of the Missouri Code, shares of Agribrands
Common Stock (the "Agribrands Dissenting Shares") or Ralcorp Common Stock (the
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"Ralcorp Dissenting Shares") that are issued and outstanding immediately prior
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to the Effective Time and that have not voted for the adoption of this Agreement
and with respect to which such rights have been properly demanded in accordance
with Section 351.455 of the Missouri Code (collectively, the "Dissenting
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Shares") shall not be converted into the right to receive Merger Consideration
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at or after the Effective Time unless and until the holder of such shares
becomes ineligible for such rights. If a holder of Dissenting Shares becomes
ineligible under Section 351.455, then, as of the Effective Time or the
occurrence of such event whichever later occurs, such holder's Dissenting Shares
shall cease to be Dissenting Shares and shall be converted into and represent
the right to receive the Merger Consideration upon surrender of the Certificates
representing such Dissenting Shares in accordance with Section 3.4. Agribrands
and Ralcorp shall give prompt notice to the other of any demand received by
Agribrands or Ralcorp, as the case may be, from an objecting shareholder
demanding fair value for the Agribrands Common Stock or Ralcorp Common Stock.
Prior to the Effective Time, except with the prior written consent of the other,
which consent shall not be unreasonably withheld or delayed, or as may otherwise
be required under applicable law, neither Agribrands nor Ralcorp, as the case
may be, shall make any payment with respect to, or settle or offer to settle,
any such demands.
(d) Notwithstanding anything contained in this Section to the contrary,
each share of Agribrands Common Stock and Ralcorp Common Stock issued and held
in the respective company's treasury immediately prior to the Effective Time
shall, by virtue of the Agribrands Merger and the Ralcorp Merger, cease to be
outstanding and shall be canceled and retired without payment of any
consideration therefor and will not be deemed outstanding for purposes of
Section 3.4.
(e) Notwithstanding the foregoing, each share of Agribrands Common
Stock or Ralcorp Common Stock owned by Agribrands or Ralcorp or their respective
subsidiaries at the Effective Time shall, by virtue of the Agribrands Merger and
the Ralcorp Merger, be canceled and retired without payment of any consideration
therefor and will not be deemed outstanding for purposes of Section 3.4.
(f) The Stock Election shall be subject to appropriate adjustment in
the event of a stock split, stock dividend or recapitalization after the date of
this Agreement applicable to the Ralcorp Common Stock or the Agribrands Common
Stock.
3.4. SURRENDER AND PAYMENT.
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(a) Prior to the Effective Time, Agribrands and Ralcorp shall
cause Holding Company to appoint an agent as designated by Agribrands and
Ralcorp (the "Exchange Agent") for the purpose of exchanging the Certificates
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for the Merger Consideration. Immediately after the Effective Time, Agribrands
and Ralcorp shall cause Holding Company to deposit with or make available to the
Exchange Agent the Merger Consideration to be paid in respect of the shares (the
"Exchange Fund"). If deposited, upon receipt, the Exchange Agent will invest
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the cash portion of the Exchange Fund in United States government securities
maturing at the Election Deadline or such other investments as Holding Company
may direct. Promptly after the Effective Time, Holding Company will send, or
will cause the Exchange Agent to send, (A) to each record holder of shares of
Agribrands Common Stock and Ralcorp Common Stock, at the Effective Time, a
letter of transmittal and instructions (which shall specify that the delivery
shall be effected, and risk of loss and title shall pass, only upon proper
delivery of the Certificates to the Exchange Agent) for use in such exchange,
and (B) to each record holder of shares of Agribrands Common Stock and Ralcorp
Common Stock, an election form (the "Election Form") providing for such holders
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to make a Stock Election or a Cash Election. Any Stock Election or Cash
Election shall be validly made only if the Exchange Agent shall have received by
5:00 p.m., St. Louis time, on a date (the "Election Deadline") to be mutually
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agreed upon by Agribrands and Ralcorp (which date shall not be later than the
twentieth Business Day after the Effective Time), an Election Form properly
completed and executed (with the signature or signatures thereon guaranteed to
the extent required by the Election Form) by such holder accompanied by such
holder's Certificates, or by an appropriate guarantee of delivery of such
Certificates from a member of any registered national securities exchange or of
the National Association of Securities Dealers, Inc. or a commercial bank or
trust company in the United States as set forth in such Election Form. Any
holder of Agribrands Common Stock or Ralcorp Common Stock who has made an
election by submitting an Election Form to the Exchange Agent shall be deemed to
have irrevocably made such election. Any holder of Agribrands Common Stock or
Ralcorp Common Stock who fails to properly make the required election shall be
deemed to have made a Stock Election with respect to the shares (other than
Dissenting Shares) owned by such holder for which no such election has been
made.
(b) Upon surrender to the Exchange Agent of his Certificate together
with a properly completed letter of transmittal, each holder of shares of
Agribrands Common Stock (the "Agribrands Holders") or Ralcorp Common Stock (the
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"Ralcorp Holders") will be entitled to receive promptly after the Election
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Deadline the Merger Consideration in respect of the shares of the Agribrands
Common Stock or Ralcorp Common Stock represented by his Certificate. Until so
surrendered, each such Certificate shall represent after the Effective Time, for
all purposes, only the right to receive the Merger Consideration.
(c) If any portion of the Merger Consideration is to be paid to a
Person other than the Person in whose name the Certificate so surrendered is
registered, it shall be a condition to such payment that such Certificate shall
be properly endorsed or otherwise be in proper form for transfer and that the
Person requesting such payment shall pay to the Exchange Agent any transfer or
other taxes required as a result of such payment to a Person other than the
registered holder of such Certificate, or establish to the satisfaction of the
Exchange Agent that such tax has been paid or is not payable.
(d) Any portion of the Exchange Fund made available to or deposited
with the Exchange Agent pursuant to Section 3.4 that remains unclaimed by the
Agribrands Holders and Ralcorp Holders, six months after the Effective Time
shall be returned to Holding Company, upon demand, and any such holder who has
not exchanged his shares for the Merger Consideration in accordance with this
Section 3.4 prior to that time shall thereafter look only to Holding Company for
payment of such consideration, and any dividends and distributions in respect of
such shares, in each case without any interest thereon. Notwithstanding the
foregoing, Holding Company shall not be liable to any Agribrands Holder or
Ralcorp Holder for any amounts paid to a public official pursuant to applicable
abandoned property, escheat or similar laws. Any amounts remaining unclaimed by
the Agribrands Holders or Ralcorp Holders five years after the Effective Time
(or such earlier date, immediately prior to such time when the amounts would
otherwise escheat to or become property of any Governmental Authority) shall
become, to the extent permitted by applicable law, the property of Holding
Company free and clear of any claims or interest of any Person previously
entitled thereto.
(e) No dividends or other distributions with respect to any Holding
Company Common Stock and no cash payment in lieu of fractional shares as
provided in Section 3.6, shall be paid to the holder of any unsurrendered
Certificates until such Certificates are surrendered as provided in Section 3.4.
Following such surrender, there shall be paid, without interest, to the Person
in whose name such Holding Company Common Stock has been registered, (i) at the
time of such surrender, (A) in the case of Certificates, the amount of any cash
payable in lieu of fractional shares to which such Person is entitled pursuant
to Section 3.6, and (B) the amount of all dividends or other distributions with
a record date after the Effective Time previously paid or payable on the date of
such surrender, with respect to such Holding Company Common Stock, and (ii) at
the appropriate payment date, the amount of dividends or other distributions
with a record date after the Effective Time but prior to surrender, and with a
payment date subsequent to surrender, payable with respect to such Holding
Company Common Stock.
(f) (i) If the percentage of shares of Agribrands Common Stock
outstanding immediately prior to the Effective Time for which Agribrands Stock
Elections were made (the "Agribrands Stock Election Percentage") is equal to or
------------------------------------
greater than 80%, then all shares of Agribrands Common Stock covered by
Agribrands Stock Elections shall be converted into the right to receive shares
of Holding Company Common Stock, and all shares of Agribrands Common Stock
covered by Agribrands Cash Elections shall be converted into the right to
receive the Agribrands Cash Consideration.
(ii) If the Agribrands Stock Election Percentage is less than 80%,
then all shares of Agribrands Common Stock covered by Agribrands Stock Elections
shall be converted into the right to receive shares of Holding Company Common
Stock, and the shares for which each holder made an Agribrands Cash Election
(the "Agribrands Cash Election Shares") shall be treated as follows:
----------------------------------
(A) Such holder shall be deemed to have made the Agribrands Stock
Election in respect of a fraction (not greater than one) of such holder's
Agribrands Cash Election Shares, (x) the numerator of which is the difference of
80% minus the Agribrands Stock Election Percentage, and (y) the denominator of
which is the percentage of shares of Agribrands Common Stock outstanding
immediately prior to the Effective Time for which Agribrands Cash Elections were
made; and
(B) The balance of such holder's Agribrands Cash Election Shares
shall be converted into the right to receive the Agribrands Cash Consideration.
(g) (i) If the percentage of shares of Ralcorp Common Stock outstanding
immediately prior to the Effective Time for which Ralcorp Stock Elections were
made (the "Ralcorp Stock Election Percentage") is equal to or greater than 80%,
---------------------------------
then all shares of Ralcorp Common Stock covered by Ralcorp Stock Elections shall
be converted into the right to receive shares of Holding Company Common Stock,
and all shares of Ralcorp Common Stock covered by Ralcorp Cash Elections shall
be converted into the right to receive the Ralcorp Cash Consideration.
(ii) If the Ralcorp Stock Election Percentage is less than 80%, then
all shares of Ralcorp Common Stock covered by Ralcorp Stock Elections shall be
converted into the right to receive shares of Holding Company Common Stock, and
the shares for which each holder made a Ralcorp Cash Election (the "Ralcorp Cash
------------
Election Shares") shall be treated as follows:
----------------
(A) Such holder shall be deemed to have made the Ralcorp Stock
Election in respect of a fraction (not greater than one) of such holder's
Ralcorp Cash Election Shares, (x) the numerator of which is the difference of
80% minus the Ralcorp Stock Election Percentage, and (y) the denominator of
which is the percentage of shares of Ralcorp Common Stock outstanding
immediately prior to the Effective Time for which Ralcorp Cash Elections were
made; and
(B) The balance of such holder's Ralcorp Cash Election Shares
shall be converted into the right to receive the Ralcorp Cash Consideration.
3.5. OPTIONS.
-------
(a) At the Effective Time, each option granted by Agribrands to
purchase shares of Agribrands Common Stock (the "Agribrands Options") which is
------------------
outstanding and unexercised immediately prior to the Effective Time shall either
be assumed by Holding Company or converted into an option ("New Agribrands
--------------
Options") to purchase shares of Holding Company Common Stock having the same
-------
terms and conditions as are in effect immediately prior to the Effective Time
(including such terms and conditions as may be incorporated by reference into
the agreements evidencing Agribrands Options pursuant to the plans or
arrangements pursuant to which such Agribrands Options were granted and taking
into account the provisions of Section 6.9 hereof) except that the exercise
price and number of shares issuable upon exercise shall be divided and
multiplied, respectively, by 3.00.
(b) At the Effective Time, each option granted by Ralcorp to purchase
shares of Ralcorp Common Stock (the "Ralcorp Options") which is outstanding and
---------------
unexercised immediately prior to the Effective Time shall either be assumed by
Holding Company or converted into an option ("New Ralcorp Options") to purchase
-------------------
shares of Holding Company Common Stock having the same terms and conditions as
are in effect immediately prior to the Effective Time (including such terms and
conditions as may be incorporated by reference into the agreements evidencing
Ralcorp Options pursuant to the plans or arrangements pursuant to which such
Ralcorp Options were granted and taking into account the provisions of Section
7.9 hereof) except that the exercise price and number of shares issuable upon
exercise shall be divided and multiplied, respectively, by 1.03.
3.6. FRACTIONAL SHARES.
------------------
No fractional shares of Holding Company Common Stock shall be issued in the
Mergers. All fractional shares of Holding Company Common Stock that a holder of
shares of Agribrands Common Stock or Ralcorp Common Stock would otherwise be
entitled to receive as a result of the Mergers shall be aggregated and if a
fractional share results from such aggregation, such holder shall be entitled to
receive, in lieu thereof, an amount in cash without interest determined by
multiplying the fraction of a share of Holding Company Common Stock to which
such holder would otherwise have been entitled by $15.00.
3.7. WITHHOLDING RIGHTS.
-------------------
Holding Company shall be entitled to deduct and withhold from the
consideration otherwise payable to any Person pursuant to this Article 3 such
amounts as it is required to deduct and withhold with respect to the making of
such payment under any provision of federal, state, local or foreign tax law.
If Holding Company so withholds amounts, such amounts shall be treated for all
purposes of this Agreement as having been paid to the Agribrands Holder or
Ralcorp Holder, as the case may be, in respect of which Holding Company made
such deduction and withholding.
ARTICLE IV.
REPRESENTATIONS AND WARRANTIES OF AGRIBRANDS
Agribrands represents and warrants to Ralcorp that the statements contained
in this Article IV are true and correct, except as set forth in the disclosure
schedule delivered by Agribrands to Ralcorp prior to the execution of this
Agreement (the "Agribrands Disclosure Schedule") or as otherwise expressly
--------------------------------
contemplated by this Agreement.
4.1. ORGANIZATION AND GOOD STANDING.
---------------------------------
Agribrands is a corporation duly organized, validly existing and in good
standing under the laws of the State of Missouri. Each of the subsidiaries of
Agribrands (the "Agribrands Subsidiaries") is a corporation duly organized,
------------------------
validly existing and in good standing under the laws of the jurisdiction of its
incorporation. Each of Agribrands and the Agribrands Subsidiaries is qualified
to do business as a foreign corporation in each jurisdiction in which the
failure to be so qualified would have an Agribrands Material Adverse Effect.
For purposes of this Agreement, "Agribrands Material Adverse Effect" shall mean
----------------------------------
a material adverse effect on (i) the business, assets, condition (financial or
otherwise), properties, liabilities or the results of operations of Agribrands
and the Agribrands Subsidiaries, taken as a whole, (ii) the ability of
Agribrands to perform its obligations set forth in this Agreement, or (iii) the
ability of Agribrands to timely consummate the transactions contemplated by this
Agreement. The Articles of Incorporation and Bylaws of Agribrands and the
Agribrands Subsidiaries will not be amended prior to the Closing Date.
Agribrands and the Agribrands Subsidiaries have all corporate power and all
material governmental licenses, authorizations, consents and approvals required
to carry on their respective businesses substantially as now being conducted and
necessary to own, operate and lease their properties and assets.
4.2. CAPITALIZATION.
--------------
As of the date hereof, the authorized capital stock of Agribrands consists
of 50,000,000 shares of Agribrands Common Stock and 10,000,000 shares of
preferred stock, par value $.01 per share (the "Agribrands Preferred Stock").
--------------------------
Of such authorized shares, as of the date hereof, there are issued and
outstanding 9,813,101 shares of Agribrands Common Stock, 854,810 shares of
Agribrands Common Stock are issued and held in the treasury of Agribrands, no
shares of the Agribrands Preferred Stock have been designated or issued, and no
other capital stock of Agribrands is issued or outstanding. All issued and
outstanding shares of Agribrands Common Stock are duly authorized, validly
issued and outstanding, fully paid and nonassessable and were issued free of
preemptive rights in compliance with applicable corporate and securities Laws.
Except as set forth in the Agribrands Securities Filings (as hereinafter
defined), as of the date hereof there are no outstanding rights, subscriptions,
warrants, puts, calls, unsatisfied preemptive rights, options or other
agreements of any kind relating to any of the outstanding, authorized but not
issued, unauthorized or treasury shares of the capital stock or any other
security of Agribrands, and there is no authorized or outstanding security of
any kind convertible into or exchangeable for any such capital stock or other
security. Except as disclosed in the Agribrands Securities Filings, there are
no restrictions upon the transfer of or otherwise pertaining to the securities
(including, but not limited to, the ability to pay dividends thereon) or
retained earnings of Agribrands and the Agribrands Subsidiaries or the ownership
thereof other than those imposed by the Securities Act, the Securities Exchange
Act, applicable state securities Laws or applicable corporate Law.
4.3. SUBSIDIARIES.
------------
Each Agribrands Subsidiary is wholly owned by Agribrands and all of the
capital stock and other interests of the Agribrands Subsidiaries so held by
Agribrands are directly or indirectly owned by it, free and clear of any claim,
lien, encumbrance, security interest or agreement with respect thereto. All of
the outstanding shares of capital stock in each of the Agribrands Subsidiaries
directly or indirectly held by Agribrands are duly authorized, validly issued
and outstanding, fully paid and nonassessable and were issued free of preemptive
rights in compliance with applicable corporate and securities Laws. There are
no irrevocable proxies or similar obligations with respect to such capital stock
of the Agribrands Subsidiaries held by Agribrands and no equity securities or
other interests of any of the Agribrands Subsidiaries are or may become required
to be issued or purchased by reason of any options, warrants, rights to
subscribe to, puts, calls or commitments of any character whatsoever relating
to, or securities or rights convertible into or exchangeable for, shares of any
capital stock of any Agribrands Subsidiary, and there are no contracts,
commitments, understandings or arrangements by which any Agribrands Subsidiary
is bound to issue additional shares of its capital stock, or options, warrants
or rights to purchase or acquire any additional shares of its capital stock or
securities convertible into or exchangeable for such shares.
4.4. AUTHORIZATION; BINDING AGREEMENT.
----------------------------------
Agribrands has all requisite corporate power and authority to execute and
deliver this Agreement and to consummate the transactions contemplated hereby.
The execution and delivery of this Agreement and the other agreements and
documents referred to herein to which Agribrands is or will be a party or a
signatory (the "Agribrands Ancillary Agreements") and the consummation of the
--------------------------------
transactions contemplated hereby and thereby, including, but not limited to, the
Agribrands Merger, have been duly and validly authorized by Agribrands' Board of
Directors, and no other corporate proceedings on the part of Agribrands or any
Agribrands Subsidiary are necessary to authorize the execution and delivery of
this Agreement or to consummate the transactions contemplated hereby (other than
the approval and adoption of this Agreement, the Agribrands Merger Agreement and
the transactions contemplated hereby and thereby by the shareholders of
Agribrands in accordance with the Missouri Code and the Articles of
Incorporation and Bylaws of Agribrands). This Agreement has been duly and
validly executed and delivered by Agribrands and constitutes, and upon execution
and delivery thereof as contemplated by this Agreement, the Agribrands Ancillary
Agreements will constitute, the legal, valid and binding agreements of
Agribrands, enforceable against Agribrands in accordance with its and their
respective terms, except to the extent that enforceability thereof may be
limited by applicable bankruptcy, insolvency, reorganization or other similar
laws affecting the enforcement of creditors' rights generally and by principles
of equity ("Enforceability Exceptions").
--------------------------
4.5. GOVERNMENTAL APPROVALS.
-----------------------
No consent, approval, waiver or authorization of, notice to or declaration
or filing with ("Consent") any nation or government, any state or other
-------
political subdivision thereof, any person, authority or body exercising
executive, legislative, judicial, regulatory or administrative functions of or
pertaining to government including, without limitation, any governmental or
regulatory authority, agency, department, board, commission or instrumentality,
any court, tribunal or arbitrator and any self-regulatory organization
("Governmental Authority") on the part of Agribrands or any of the Agribrands
-----------------------
Subsidiaries is required in connection with the execution or delivery by
Agribrands of this Agreement or the consummation by Agribrands of the
transactions contemplated hereby other than (i) the filing of the Articles of
Merger with the Secretary of State of the State of Missouri in accordance with
the Missouri Code, (ii) filings with the SEC, state securities laws
administrators, and the New York Stock Exchange (the "NYSE"), (iii) Consents
----
from or with Governmental Authorities set forth on the Agribrands Disclosure
Schedule, (iv) filings under the ▇▇▇▇-▇▇▇▇▇-▇▇▇▇▇▇ Antitrust Improvements Act of
1976, as amended, and the rules and regulations promulgated thereunder (the "HSR
---
Act"), (v) the supplemental ruling from the Internal Revenue Service (the "IRS")
--- ---
referred to in Section 6.15 below; and (vi) those Consents that, if they were
not obtained or made, do not or would not reasonably be expected to have an
Agribrands Material Adverse Effect.
4.6. NO VIOLATIONS.
--------------
The execution and delivery of this Agreement and the Agribrands Ancillary
Agreements, the consummation of the transactions contemplated hereby and thereby
and compliance by Agribrands with any of the provisions hereof or thereof will
not (i) conflict with or result in any breach of any provision of the Articles
and/or Certificate of Incorporation or Bylaws or other governing instruments of
Agribrands or any of the Agribrands Subsidiaries, (ii) require any Consent under
or result in a violation or breach of, or constitute (with or without due notice
or lapse of time or both) a default (or give rise to any right of termination,
cancellation or acceleration or augment the performance required) under any of
the terms, conditions or provisions of any Agribrands Material Contract (as
hereinafter defined) or other material obligation to which Agribrands or any
Agribrands Subsidiary is a party or by which any of them or any of their
properties or assets may be bound, (iii) result in the creation or imposition of
any lien or encumbrance of any kind upon any of the assets of Agribrands or any
Agribrands Subsidiary, or (iv) subject to obtaining the Consents from
Governmental Authorities referred to in Section 4.5, above, contravene any
applicable provision of any constitution, treaty, statute, law, code, rule,
regulation, ordinance, policy or order of any Governmental Authority or other
matters having the force of law including, but not limited to, any orders,
decisions, injunctions, judgments, awards and decrees of or agreements with any
court or other Governmental Authority ("Law") currently in effect to which
---
Agribrands or any Agribrands Subsidiary or its or any of their respective assets
or properties are subject, except in the case of clauses (ii), (iii) and (iv)
above, for any deviations from the foregoing which do not or would not
reasonably be expected to have an Agribrands Material Adverse Effect.
4.7. SECURITIES FILINGS AND LITIGATION.
------------------------------------
Agribrands has made available to Ralcorp true and complete copies of (i) its
Annual Reports on Form 10-K, as amended, for the years ended August 31, 1998 and
1999, as filed with the SEC, (ii) its proxy statements relating to all of the
meetings of shareholders (whether annual or special) of Agribrands since April
1, 1998, as filed with the SEC, and (iii) all other reports, statements and
registration statements and amendments thereto (including, without limitation,
Quarterly Reports on Form 10-Q and Current Reports on Form 8-K, as amended)
filed by Agribrands with the SEC since April 1, 1998. The reports and
statements set forth in clauses (i) through (iii), above, and those subsequently
provided or required to be provided pursuant to this Section, are referred to
collectively herein as the "Agribrands Securities Filings." As of their
-------------------------------
respective dates, or as of the date of the last amendment thereof, if amended
after filing, none of the Agribrands Securities Filings (including all schedules
thereto and disclosure documents incorporated by reference therein), contained
or, as to Agribrands Securities Filings subsequent to the date hereof, will
contain any untrue statement of a material fact or omitted or, as to Agribrands
Securities Filings subsequent to the date hereof, will omit to state a material
fact required to be stated therein or necessary to make the statements therein,
in light of the circumstances under which they were made, not misleading. Each
of the Agribrands Securities Filings was filed in a timely manner and at the
time of filing or as of the date of the last amendment thereof, if amended after
filing, complied or, as to Agribrands Securities Filings subsequent to the date
hereof, will comply in all material respects with the Securities Exchange Act or
the Securities Act, as applicable. There is no action, cause of action, claim,
demand, suit, proceeding, citation, summons, subpoena, inquiry or investigation
of any nature, civil, criminal, regulatory or otherwise, in law or in equity, by
or before any court, tribunal, arbitrator or other Governmental Authority
("Litigation") pending or, to the knowledge of Agribrands, threatened against
----------
Agribrands or any of its subsidiaries, any officer, director, employee or agent
thereof, in his or her capacity as such, or as a fiduciary with respect to any
Agribrands Benefit Plan, as hereinafter defined, or otherwise relating to
Agribrands or any of its subsidiaries or the securities of any of them, or any
properties or rights of Agribrands or any of its subsidiaries or any Agribrands
Benefit Plan which is required to be described in any Agribrands Securities
Filing that is not so described. No event has occurred as a consequence of
which Agribrands would be required to file a Current Report on Form 8-K pursuant
to the requirements of the Securities Exchange Act as to which such a report has
not been timely filed with the SEC. Any reports, statements and registration
statements and amendments thereof (including, without limitation, Reports on
Form 10-K, Quarterly Reports on Form 10-Q and Current Reports on Form 8-K, as
amended) filed by Agribrands with the SEC after the date hereof shall be
provided to Ralcorp on the date of such filing.
4.8. AGRIBRANDS FINANCIAL STATEMENTS.
---------------------------------
The audited consolidated financial statements and unaudited interim
financial statements of Agribrands included in the Agribrands Securities Filings
(the "Agribrands Financial Statements") have been prepared in accordance with
---------------------------------
generally accepted accounting principles applied on a consistent basis (except
as may be indicated therein or in the notes thereto) and present fairly, in all
material respects, the financial position of Agribrands and the Agribrands
Subsidiaries as at the dates thereof and the results of their operations and
cash flows for the periods then ended subject, in the case of the unaudited
interim financial statements, to normal year-end audit adjustments, any other
adjustments described therein and the fact that certain information and notes
have been condensed or omitted in accordance with the Securities Exchange Act.
4.9. ABSENCE OF CERTAIN CHANGES OR EVENTS.
-----------------------------------------
Except as set forth in the Agribrands Securities Filings, since August 31,
1999, there has not been: (i) any event, occurrence, fact, condition, change,
development or effect ("Event") (except for those Events caused by (x)
-----
conditions affecting national, regional or world economies such as currency
fluctuations (but excluding extraordinary disruptions in regional or world
economies or markets or US/foreign currency exchange ratios involving multiple
countries), (y) conditions affecting the animal feed industry in the regions in
which Agribrands operates, or (z) the pendency or announcement of this
Agreement, or the transactions contemplated hereby) that has had or would
reasonably be expected to have an Agribrands Material Adverse Effect; (ii) any
declaration, payment or setting aside for payment of any dividend (except to
Agribrands or an Agribrands Subsidiary wholly owned by Agribrands) or other
distribution or any redemption, purchase or other acquisition of any shares of
capital stock or securities of Agribrands or any Agribrands Subsidiary; (iii)
any return of any capital or other distribution of assets to shareholders of
Agribrands or any Agribrands Subsidiary (except to Agribrands or an Agribrands
Subsidiary wholly owned by Agribrands); (iv) any acquisition (by merger,
consolidation, acquisition of stock or assets or otherwise) of any person or
business; or (v) any other action or agreement or undertaking by Agribrands or
any Agribrands Subsidiary that, if taken or done on or after the date hereof
without Ralcorp's consent, would result in a breach of Section 6.1, below, and
that has had or would reasonably be expected to have an Agribrands Material
Adverse Effect.
4.10. RELATED PARTY TRANSACTIONS.
----------------------------
Except as set forth in the Agribrands Securities Filings, since November
23, 1999, Agribrands has not entered into any relationship or transaction of a
sort that would be required to be disclosed pursuant to Item 404 of Regulation
S-K by Agribrands in a proxy statement in connection with an annual meeting of
shareholders.
4.11. COMPLIANCE WITH LAWS.
----------------------
The business of Agribrands and each Agribrands Subsidiary has been operated
in compliance with all Laws applicable thereto, except for any instances of
non-compliance which do not and would not reasonably be expected to have an
Agribrands Material Adverse Effect. Without limiting the generality of the
foregoing, neither Agribrands nor any Agribrands Subsidiary has conducted its
business in violation of applicable Laws, tariffs, rules and regulations in any
jurisdiction, foreign or domestic, which violation has had or would reasonably
be expected to have an Agribrands Material Adverse Effect.
4.12 PERMITS.
-------
Agribrands and the Agribrands Subsidiaries have all material permits,
certificates, licenses, approvals, tariffs and other authorizations required in
connection with the operation of their respective businesses (collectively,
"Agribrands Permits"), and neither Agribrands nor any Agribrands Subsidiary is
-------------------
in violation of any Agribrands Permit, and no proceedings are pending or, to the
knowledge of Agribrands, threatened, to revoke or limit any Agribrands Permit,
except any such violation or proceeding which does not and would not reasonably
be expected to have an Agribrands Material Adverse Effect.
4.13. FINDERS AND INVESTMENT BANKERS.
---------------------------------
Neither Agribrands nor any of its officers or directors has employed any
broker or finder or incurred any liability for any brokerage fees, commissions
or finders' fees in connection with the transactions contemplated hereby other
than pursuant to the agreements with ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co., Inc. and
▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ & ▇▇▇▇▇, accurate and complete copies of which have been
provided to Ralcorp.
4.14. MATERIAL CONTRACTS.
-------------------
Neither Agribrands nor any Agribrands Subsidiary is a party or is subject
to any note, bond, mortgage, indenture, contract, lease, license, agreement,
understanding, instrument, bid or proposal that is required to be described in
or filed as an exhibit to any Agribrands Securities Filing ("Agribrands Material
-------------------
Contract") that is not so described in or filed as required by the Securities
--------
Act or the Securities Exchange Act, as the case may be. Agribrands has made
available to Ralcorp true and accurate copies of the Agribrands Material
Contracts. All such Agribrands Material Contracts are valid and binding and are
in full force and effect and enforceable against Agribrands or such subsidiary
in accordance with their respective terms, subject to the Enforceability
Exceptions. Except as referenced in Section 4.6 above, (i) no Consent of any
person is needed in order that each such Agribrands Material Contract shall
continue in full force and effect in accordance with its terms without penalty,
acceleration or rights of early termination by reason of the consummation of the
transactions contemplated by this Agreement, except for Consents the absence of
which would not have an Agribrands Material Adverse Effect, and (ii) neither
Agribrands nor any of its subsidiaries is in violation or breach of or default
under any such Agribrands Material Contract; nor to Agribrands' knowledge is any
other party to any such Agribrands Material Contract in violation or breach of
or default under any such Agribrands Material Contract in each case where such
violation or breach would have an Agribrands Material Adverse Effect.
4.15. EMPLOYEE BENEFIT PLANS.
------------------------
(a) There are no Benefit Plans (as defined below) or Foreign Plans (as
defined below) maintained or contributed to by Agribrands or an Agribrands
Subsidiary under which Agribrands or an Agribrands Subsidiary could incur any
material liability. A "Benefit Plan" shall include (i) an employee benefit plan
------------
as defined in Section 3(3) of the Employee Retirement Income Security Act of
1974, as amended, together with all regulations thereunder ("ERISA"), even if,
-----
because of some other provision of ERISA, such plan is not subject to any or all
of ERISA's provisions, and (ii) whether or not described in the preceding
clause, (a) any pension, profit sharing, stock bonus, deferred or supplemental
compensation, retirement, thrift, stock purchase, stock appreciation or stock
option plan, or any other compensation, welfare, fringe benefit or retirement
plan, program, policy, course of conduct, understanding or arrangement of any
kind whatsoever, whether formal or informal, oral or written, providing for
benefits for or the welfare of any or all of the current or former employees or
agents of a specified person or their beneficiaries or dependents, (b) a
multi-employer plan as defined in Section 3(37) of ERISA (a "Multi-Employer
--------------
Plan"), or (c) a multiple employer plan as defined in Section 413 of the Code.
----
(b) With respect to each Benefit Plan (where applicable): Agribrands has
made available to Ralcorp complete and accurate copies of (i) all plan and trust
texts and agreements, insurance contracts and other funding arrangements; (ii)
the most recent annual report on the Form 5500 series; (iii) the most recent
financial statement and/or annual and periodic accounting of plan assets; (iv)
the most recent determination letter received from the IRS; and (v) the most
recent summary plan description as defined in ERISA.
(c) With respect to each Benefit Plan while maintained or contributed
to by Agribrands: (i) if intended to qualify under Code Sections 401(a) or
403(a), such Benefit Plan has received a favorable determination letter from the
IRS that it so qualifies, and its trust is exempt from taxation under Code
Section 501(a) and, to the knowledge of Agribrands, nothing has since occurred
to cause the loss of the Benefit Plan's qualification; (ii) except for payment
of benefits made in the ordinary course of the plan administration, no event has
occurred and, to the knowledge of Agribrands, there exists no circumstance under
which Agribrands or Holding Company could incur liability under ERISA, the Code
or otherwise; (iii) no non-exempt prohibited transaction as defined under ERISA
and the Code has occurred; (iv) all contributions and premiums due have fully
been made and paid on a timely basis; and (v) all contributions made or required
to be made under any Benefit Plan meet the requirements for deductibility under
the Code, and all contributions accrued prior to the Effective Time which have
not been made have been properly recorded on the Agribrands Financial Statements
in a manner satisfying the requirements of Financial Accounting Standards 87 and
88 except, in each case, for any deviations from the foregoing which do not and
would not reasonably be expected to have an Agribrands Material Adverse Effect.
(d) No Benefit Plan is a pension plan subject to Title IV of ERISA or
Section 412 of the Code. Each of the Benefit Plans has been maintained in
compliance with its terms and all applicable Law, except where the failure to do
so would not reasonably be expected to have an Agribrands Material Adverse
Effect. Agribrands does not contribute to, or have any outstanding liability
with respect to, any Multi-employer Plan.
(e) With respect to each Benefit Plan which is a welfare plan (as
defined in ERISA Section 3(1)): (i) any liability for medical or death benefits
with respect to current or former employees beyond their termination of
employment (except as may be required by applicable Law) is provided for in the
Agribrands Financial Statements to the extent required by generally accepted
accounting principles; (ii) there are no reserves, assets, surplus or prepaid
premiums under any such plan; (iii) no term or provision of any such plan
prohibits the amendment or termination thereof; (iv) Agribrands has complied
with Code Section 4980B, except, in each case, for any deviations from the
foregoing which do not and would not reasonably be expected to have an
Agribrands Material Adverse Effect; and (v) each such Benefit Plan which is
intended to meet the requirements for tax-favored treatment under Subchapter B
of Chapter 1 of the Code meets such requirements.
(f) Except as provided in Section 6.9 below, the consummation of the
Agribrands Merger will not, either alone or in conjunction with another Event
under the terms of any Benefit Plan: (i) entitle any individual to severance
pay, (ii) accelerate the time of payment or vesting of benefits or increase the
amount of compensation due to any individual; or (iii) give rise to the payment
of any amount that would not be deductible pursuant to Section 280G of the Code.
(g) With respect to each Benefit Plan which is contributed to or
required to be maintained by the law or applicable custom or rule of the
relevant jurisdiction outside of the United States (the "Foreign Plans") except,
in each case, for any deviations from the below which do not and would not
reasonably be expected to have an Agribrands Material Adverse Effect:
(i) Each of the Foreign Plans is in compliance with the provisions
of the laws of each jurisdiction in which each such Foreign Plan is maintained,
to the extent those laws are applicable to the Foreign Plans;
(ii) All contributions to, and payments from, the Foreign Plans which
may have been required to be made in accordance with the terms of any such
Foreign Plan, and, when applicable, the law of the jurisdiction in which such
Foreign Plan is maintained, have been timely made or shall be made by the
Closing Date. All such contributions to the Foreign Plans, and all payments
under the Foreign Plans, for any period ending before the Closing Date that are
not yet, but will be, required to be made, are reflected as an accrued liability
on the Balance Sheet;
(iii) All reports, returns and similar documents, if any, with respect
to any Foreign Plan required to be filed with any governmental body or
distributed to any Foreign Plan participant have been duly and timely filed or
distributed or will be filed or distributed by the Closing Date, and all of the
Foreign Plans have obtained from the governmental body having jurisdiction with
respect to such plans any required determinations, if any, that such Foreign
Plans are in compliance with the laws of the relevant jurisdiction if such
determinations are required in order to give effect to the Foreign Plan;
(iv) Each of the Foreign Plans has been administered at all times in
accordance with its terms. To the knowledge of Agribrands, there are no pending
investigations by any governmental body involving the Foreign Plans, and no
pending claims (except for claims for benefits payable in the normal operations
of the Foreign Plans), suits or proceedings against any Foreign Plan or
asserting any rights or claims to benefits under any Foreign Plan; and
(v) The consummation of the transactions contemplated by this Agreement
will not by itself create or otherwise result in any liability with respect to
any Foreign Plan other than the triggering of payment to participants.
4.16. TAXES AND RETURNS.
-------------------
(a) Agribrands and each of the Agribrands Subsidiaries have timely
filed or caused to be filed all material Tax Returns required to be filed by it,
and all Tax Returns filed by Agribrands and the Agribrands Subsidiaries are
true, complete and correct in all material respects.
(b) Agribrands and the Agribrands Subsidiaries have each timely paid,
collected or withheld, or caused to be timely paid, collected or withheld, all
material amounts of Taxes required to be paid, collected or withheld, other than
such Taxes for which adequate reserves in the Agribrands Financial Statements
have been established.
(c) There are no claims or assessments pending against Agribrands or
any of the Agribrands Subsidiaries for any alleged deficiency in any Tax, and
Agribrands has not been notified in writing of any proposed Tax claims or
assessments against Agribrands or any of the Agribrands Subsidiaries (other than
in each case, claims or assessments for which adequate reserves in the
Agribrands Financial Statements have been established or which are being
contested in good faith or are immaterial in amount).
(d) There are no material federal, state, local or foreign audits or
administrative proceedings pending with regard to any material amounts of Tax or
Tax Return of Agribrands or the Agribrands Subsidiaries and none of them has
received a written notice of any proposed material audit or proceeding.
(e) Neither Agribrands nor any of the Agribrands Subsidiaries has any
waivers or extensions of any applicable statute of limitations to assess any
material amount of Taxes.
(f) There are no outstanding requests by Agribrands or any of the
Agribrands Subsidiaries for any extension of time within which to file any
material Tax Return or within which to pay any material amounts of Taxes shown
to be due on any return.
(g) There are no liens for material amounts of Taxes on the assets of
Agribrands or any of the Agribrands Subsidiaries except for statutory liens for
current Taxes not yet due and payable.
(h) Neither Agribrands nor any Agribrands Subsidiary is a party to any
agreement, contract, arrangement, or plan that has resulted or would result,
individually or in the aggregate, in connection with this Agreement or any
change of control of Agribrands or any of the Agribrands Subsidiaries in the
payment of any "excess parachute payments" within the meaning of Section 280G of
the Code.
(i) For purposes of this Agreement, the term "Tax" shall mean any
federal, state, local, foreign or provincial income, gross receipts, property,
sales, use, license, excise, franchise, employment, payroll, alternative or
added minimum, ad valorem, withholding, estimated, transfer or excise tax, or
any other tax, custom, duty, governmental fee or other like assessment or charge
of any kind whatsoever, together with any interest or penalty imposed by any
Governmental Authority. The term "Tax Return" shall mean a report, return or
other information (including any attached schedules or any amendments to such
report, return or other information) required to be supplied to or filed with a
governmental entity with respect to any Tax, including an information return,
claim for refund, amended return or declaration of estimated Tax.
4.17. NO ADVERSE ACTIONS.
--------------------
There is no existing, pending or, to the knowledge of Agribrands,
threatened termination, cancellation, limitation, modification or change in the
business relationship of Agribrands or any of the Agribrands Subsidiaries, with
any supplier, customer or other person except such as would not reasonably be
expected to have an Agribrands Material Adverse Effect. None of Agribrands, any
Agribrands Subsidiary or, to the knowledge of Agribrands, any director, officer,
agent, employee or other person acting on behalf of any of the foregoing has
used any corporate funds for unlawful contributions, payments, gifts or
entertainment or for the payment of other unlawful expenses relating to
political activity, or made any direct or indirect unlawful payments to
governmental or regulatory officials or others, which would reasonably be
expected to have an Agribrands Material Adverse Effect.
4.18. FAIRNESS OPINIONS.
------------------
Agribrands' Board of Directors and the Independent Committee of the
Agribrands Board of Directors received from their respective financial advisors,
▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co., Inc. and ▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ & ▇▇▇▇▇, opinions to
the effect that the Merger Consideration is fair to the holders of the
Agribrands Shares (other than common directors of both Agribrands and Ralcorp)
from a financial point of view.
4.19. TAKEOVER STATUTES AND CHARTER.
--------------------------------
No "business combination," "fair price," "moratorium," "control share
acquisition" or other similar antitakeover statute or regulation enacted under
state or federal laws in the United States (each a "Takeover Statute"),
----------------
including, without limitation, Sections 351.407 and 351.459 of the Missouri
Code, applicable to Agribrands or any of the Agribrands Subsidiaries is
applicable to the Agribrands Merger, this Agreement, the Agribrands Ancillary
Agreements or the other transactions contemplated hereby or thereby (inasmuch as
Agribrands has approved the transactions contemplated by this Agreement and the
Agribrands Ancillary Agreements for purposes of Section 351.459 of the Missouri
Code and has taken all other requisite corporate action under the Takeover
Statutes). The provisions of Article Four of the Articles of Incorporation of
Agribrands are not applicable to the Agribrands Merger, this Agreement, the
Agribrands Ancillary Agreements or the other transactions contemplated hereby or
thereby (inasmuch as there are one or more "Continuing Directors" (as defined in
the Articles of Incorporation of Agribrands) and the Agribrands Merger has been
approved by a majority of them).
4.20. AGRIBRANDS RIGHTS PLAN.
------------------------
Under the Rights Agreement between Agribrands and Continental Stock
Transfer & Trust Company, dated as of March 31, 1998 and as amended on August 7,
2000 (the "Agribrands Rights Agreement"), neither Merger Sub A nor Holding
-----------------------------
Company will become an "Acquiring Person," no "Shares Acquisition Date" or
"Distribution Date" (as such terms are defined in the Agribrands Rights
Agreement) will occur, and the holders of any rights issued pursuant to the
Agribrands Rights Agreement will not be entitled to receive any benefits under
the Agribrands Rights Agreement as a result of the approval, execution or
delivery of this Agreement, the Agribrands Merger Agreement or any of the
Agribrands Ancillary Agreements or the consummation of the transactions
contemplated hereby and thereby.
ARTICLE V.
REPRESENTATIONS AND WARRANTIES OF RALCORP
Ralcorp represents and warrants to Agribrands that the statements contained
in this Article V are true and correct, except as set forth in the disclosure
schedule delivered by Ralcorp to Agribrands prior to the execution of this
Agreement (the "Ralcorp Disclosure Schedule") or as otherwise expressly
-----------------------------
contemplated by this Agreement.
5.1. ORGANIZATION AND GOOD STANDING.
---------------------------------
Ralcorp is a corporation duly organized, validly existing and in good
standing under the laws of the State of Missouri. Each of the subsidiaries of
Ralcorp (the "Ralcorp Subsidiaries") is a corporation duly organized, validly
---------------------
existing and in good standing under the laws of the jurisdiction of its
incorporation. Each of Ralcorp and the Ralcorp Subsidiaries is qualified to do
business as a foreign corporation in each jurisdiction in which the failure to
be so qualified would have a Ralcorp Material Adverse Effect. For purposes of
this Agreement, "Ralcorp Material Adverse Effect" shall mean a material adverse
-------------------------------
effect on (i) the business, assets, condition (financial or otherwise),
properties, liabilities or the results of operations of Ralcorp and the Ralcorp
Subsidiaries, taken as a whole, (ii) the ability of Ralcorp to perform its
obligations set forth in this Agreement, or (iii) the ability of Ralcorp to
timely consummate the transactions contemplated by this Agreement. The Articles
of Incorporation and Bylaws of Ralcorp and the Ralcorp Subsidiaries will not be
amended prior to the Closing Date. Ralcorp and the Ralcorp Subsidiaries have
all corporate power and all material governmental licenses, authorizations,
consents and approvals required to carry on their respective businesses
substantially as now being conducted and necessary to own, operate and lease
their properties and assets.
5.2. CAPITALIZATION.
--------------
As of the date hereof, the authorized capital stock of Ralcorp consists of
300,000,000 shares of Ralcorp Common Stock and 10,000,000 shares of preferred
stock, par value $.01 per share (the "Ralcorp Preferred Stock"). Of such
-----------------------
authorized shares, as of the date hereof, there are issued and outstanding
29,859,907 shares of Ralcorp Common Stock, 3,151,410 shares of Ralcorp Common
Stock are issued and held in the treasury of Ralcorp, no shares of the Ralcorp
Preferred Stock have been designated or issued, and no other capital stock of
Ralcorp is issued or outstanding. All issued and outstanding shares of Ralcorp
Common Stock are duly authorized, validly issued and outstanding, fully paid and
nonassessable and were issued free of preemptive rights in compliance with
applicable corporate and securities Laws. Except as set forth in the Ralcorp
Securities Filings (as hereinafter defined), as of the date hereof there are no
outstanding rights, subscriptions, warrants, puts, calls, unsatisfied preemptive
rights, options or other agreements of any kind relating to any of the
outstanding, authorized but not issued, unauthorized or treasury shares of the
capital stock or any other security of Ralcorp, and there is no authorized or
outstanding security of any kind convertible into or exchangeable for any such
capital stock or other security. Except as disclosed in the Ralcorp Securities
Filings, there are no restrictions upon the transfer of or otherwise pertaining
to the securities (including, but not limited to, the ability to pay dividends
thereon) or retained earnings of Ralcorp and the Ralcorp Subsidiaries or the
ownership thereof other than those imposed by the Securities Act, the Securities
Exchange Act, applicable state securities Laws or applicable corporate Law.
5.3. SUBSIDIARIES.
------------
Each Ralcorp Subsidiary is wholly owned by Ralcorp and all of the capital
stock and other interests of the Ralcorp Subsidiaries so held by Ralcorp are
directly or indirectly owned by it, free and clear of any claim, lien,
encumbrance, security interest or agreement with respect thereto. All of the
outstanding shares of capital stock in each of the Ralcorp Subsidiaries directly
or indirectly held by Ralcorp are duly authorized, validly issued and
outstanding, fully paid and nonassessable and were issued free of preemptive
rights in compliance with applicable corporate and securities Laws. There are
no irrevocable proxies or similar obligations with respect to such capital stock
of the Ralcorp Subsidiaries held by Ralcorp and no equity securities or other
interests of any of the Ralcorp Subsidiaries are or may become required to be
issued or purchased by reason of any options, warrants, rights to subscribe to,
puts, calls or commitments of any character whatsoever relating to, or
securities or rights convertible into or exchangeable for, shares of any capital
stock of any Ralcorp Subsidiary, and there are no contracts, commitments,
understandings or arrangements by which any Ralcorp Subsidiary is bound to issue
additional shares of its capital stock, or options, warrants or rights to
purchase or acquire any additional shares of its capital stock or securities
convertible into or exchangeable for such shares.
5.4. AUTHORIZATION; BINDING AGREEMENT.
----------------------------------
Ralcorp has all requisite corporate power and authority to execute and
deliver this Agreement and to consummate the transactions contemplated hereby.
The execution and delivery of this Agreement and the other agreements and
documents referred to herein to which Ralcorp is or will be a party or a
signatory (the "Ralcorp Ancillary Agreements") and the consummation of the
------------------------------
transactions contemplated hereby and thereby, including, but not limited to, the
Ralcorp Merger, have been duly and validly authorized by Ralcorp's Board of
Directors, and no other corporate proceedings on the part of Ralcorp or any
Ralcorp Subsidiary are necessary to authorize the execution and delivery of this
Agreement or to consummate the transactions contemplated hereby (other than the
approval and adoption of this Agreement, the Ralcorp Merger Agreement and the
transactions contemplated hereby and thereby by the shareholders of Ralcorp in
accordance with the Missouri Code and the Articles of Incorporation and Bylaws
of Ralcorp). This Agreement has been duly and validly executed and delivered by
Ralcorp and constitutes, and upon execution and delivery thereof as contemplated
by this Agreement, the Ralcorp Ancillary Agreements will constitute, the legal,
valid and binding agreements of Ralcorp, enforceable against Ralcorp in
accordance with its and their respective terms, subject to the Enforceability
Exceptions.
5.5. GOVERNMENTAL APPROVALS.
-----------------------
No Consent from or with any Governmental Authority on the part of Ralcorp
or any of the Ralcorp Subsidiaries is required in connection with the execution
or delivery by Ralcorp of this Agreement or the consummation by Ralcorp of the
transactions contemplated hereby other than (i) the filing of the Articles of
Merger with the Secretary of State of the State of Missouri in accordance with
the Missouri Code, (ii) filings with the SEC, state securities laws
administrators, the NYSE and any securities exchange on which the Ralcorp Common
Stock is listed, (iii) Consents from or with Governmental Authorities set forth
on the Ralcorp Disclosure Schedule, (iv) filings under the HSR Act, and (v)
those Consents that, if they were not obtained or made, do not or would not
reasonably be expected to have a Ralcorp Material Adverse Effect.
5.6. NO VIOLATIONS.
--------------
The execution and delivery of this Agreement and the Ralcorp Ancillary
Agreements, the consummation of the transactions contemplated hereby and thereby
and compliance by Ralcorp with any of the provisions hereof or thereof will not
(i) conflict with or result in any breach of any provision of the Articles
and/or Certificate of Incorporation or Bylaws or other governing instruments of
Ralcorp or any of the Ralcorp Subsidiaries, (ii) require any Consent under or
result in a violation or breach of, or constitute (with or without due notice or
lapse of time or both) a default (or give rise to any right of termination,
cancellation or acceleration or augment the performance required) under any of
the terms, conditions or provisions of any Ralcorp Material Contract (as
hereinafter defined) or other material obligation to which Ralcorp or any
Ralcorp Subsidiary is a party or by which any of them or any of their properties
or assets may be bound, (iii) result in the creation or imposition of any lien
or encumbrance of any kind upon any of the assets of Ralcorp or any Ralcorp
Subsidiary, or (iv) subject to obtaining the Consents from Governmental
Authorities referred to in Section 5.5, above, contravene any Law currently in
effect to which Ralcorp or any Ralcorp Subsidiary or its or any of their
respective assets or properties are subject, except in the case of clauses (ii),
(iii) and (iv) above, for any deviations from the foregoing which do not or
would not reasonably be expected to have a Ralcorp Material Adverse Effect.
5.7. SECURITIES FILINGS AND LITIGATION.
------------------------------------
Ralcorp has made available to Agribrands true and complete copies of (i)
its Annual Reports on Form 10-K, as amended, for the years ended September 30,
1998 and 1999, as filed with the SEC, (ii) its proxy statements relating to all
of the meetings of shareholders (whether annual or special) of Ralcorp since
January 31, 1997, as filed with the SEC, and (iii) all other reports, statements
and registration statements and amendments thereto (including, without
limitation, Quarterly Reports on Form 10-Q and Current Reports on Form 8-K, as
amended) filed by Ralcorp with the SEC since January 31, 1997. The reports and
statements set forth in clauses (i) through (iii), above, and those subsequently
provided or required to be provided pursuant to this Section, are referred to
collectively herein as the "Ralcorp Securities Filings." As of their respective
--------------------------
dates, or as of the date of the last amendment thereof, if amended after filing,
none of the Ralcorp Securities Filings (including all schedules thereto and
disclosure documents incorporated by reference therein), contained or, as to
Ralcorp Securities Filings subsequent to the date hereof, will contain any
untrue statement of a material fact or omitted or, as to Ralcorp Securities
Filings subsequent to the date hereof, will omit to state a material fact
required to be stated therein or necessary to make the statements therein, in
light of the circumstances under which they were made, not misleading. Each of
the Ralcorp Securities Filings was filed in a timely manner and at the time of
filing or as of the date of the last amendment thereof, if amended after filing,
complied or, as to Ralcorp Securities Filings subsequent to the date hereof,
will comply in all material respects with the Securities Exchange Act or the
Securities Act, as applicable. There is no Litigation pending or, to the
knowledge of Ralcorp, threatened against Ralcorp or any of its subsidiaries, any
officer, director, employee or agent thereof, in his or her capacity as such, or
as a fiduciary with respect to any Ralcorp Benefit Plan, as hereinafter defined,
or otherwise relating to Ralcorp or any of its subsidiaries or the securities of
any of them, or any properties or rights of Ralcorp or any of its subsidiaries
or any Ralcorp Benefit Plan which is required to be described in any Ralcorp
Securities Filing that is not so described. No event has occurred as a
consequence of which Ralcorp would be required to file a Current Report on Form
8-K pursuant to the requirements of the Securities Exchange Act as to which such
a report has not been timely filed with the SEC. Any reports, statements and
registration statements and amendments thereof (including, without limitation,
Reports on Form 10-K, Quarterly Reports on Form 10-Q and Current Reports on Form
8-K, as amended) filed by Ralcorp with the SEC after the date hereof shall be
provided to Ralcorp on the date of such filing.
5.8. RALCORP FINANCIAL STATEMENTS.
------------------------------
The audited consolidated financial statements and unaudited interim
financial statements of Ralcorp included in the Ralcorp Securities Filings (the
"Ralcorp Financial Statements") have been prepared in accordance with generally
-----------------------------
accepted accounting principles applied on a consistent basis (except as may be
indicated therein or in the notes thereto) and present fairly, in all material
respects, the financial position of Ralcorp and the Ralcorp Subsidiaries as at
the dates thereof and the results of their operations and cash flows for the
periods then ended subject, in the case of the unaudited interim financial
statements, to normal year-end audit adjustments, any other adjustments
described therein and the fact that certain information and notes have been
condensed or omitted in accordance with the Securities Exchange Act.
5.9. ABSENCE OF CERTAIN CHANGES OR EVENTS.
-----------------------------------------
Except as set forth in the Ralcorp Securities Filings, since September 30,
1999, there has not been: (i) any Event (except for those Events caused by (y)
conditions affecting the store brand and value brand grocery product industry in
the regions in which Ralcorp operates, or (z) the pendency or announcement of
this Agreement, or the transactions contemplated hereby) that has had or would
reasonably be expected to have a Ralcorp Material Adverse Effect; (ii) any
declaration, payment or setting aside for payment of any dividend (except to
Ralcorp or a Ralcorp Subsidiary wholly owned by Ralcorp) or other distribution
or any redemption, purchase or other acquisition of any shares of capital stock
or securities of Ralcorp or any Ralcorp Subsidiary; (iii) any return of any
capital or other distribution of assets to shareholders of Ralcorp or any
Ralcorp Subsidiary (except to Ralcorp or a Ralcorp Subsidiary wholly owned by
Ralcorp); (iv) any acquisition (by merger, consolidation, acquisition of stock
or assets or otherwise) of any person or business; or (v) any other action or
agreement or undertaking by Ralcorp or any Ralcorp Subsidiary that, if taken or
done on or after the date hereof without Ralcorp's consent, would result in a
breach of Section 7.1, below, and that has had or would reasonably be expected
to have a Ralcorp Material Adverse Effect.
5.10. RELATED PARTY TRANSACTIONS.
----------------------------
Except as set forth in the Ralcorp Securities Filings, since December 20,
1999, Ralcorp has not entered into any relationship or transaction of a sort
that would be required to be disclosed pursuant to Item 404 of Regulation S-K by
Ralcorp in a proxy statement in connection with an annual meeting of
shareholders.
5.11. COMPLIANCE WITH LAWS.
----------------------
The business of Ralcorp and each Ralcorp Subsidiary has been operated in
compliance with all Laws applicable thereto, except for any instances of
non-compliance which do not and would not reasonably be expected to have a
Ralcorp Material Adverse Effect. Without limiting the generality of the
foregoing, neither Ralcorp nor any Ralcorp Subsidiary has conducted its business
in violation of applicable Laws, tariffs, rules and regulations in any
jurisdiction, foreign or domestic, which violation has had or would reasonably
be expected to have a Ralcorp Material Adverse Effect.
5.12. PERMITS.
-------
Ralcorp and the Ralcorp Subsidiaries have all material permits,
certificates, licenses, approvals, tariffs and other authorizations required in
connection with the operation of their respective businesses (collectively,
"Ralcorp Permits") and neither Ralcorp nor any Ralcorp Subsidiary is in
----------------
violation of any Ralcorp Permit, and no proceedings are pending or, to the
knowledge of Ralcorp, threatened, to revoke or limit any material Ralcorp
Permit, except any such violation or proceeding which does not and would not
reasonably be expected to have a Ralcorp Material Adverse Effect.
5.13. FINDERS AND INVESTMENT BANKERS.
---------------------------------
Neither Ralcorp nor any of its officers or directors has employed any
broker or finder or incurred any liability for any brokerage fees, commissions
or finders' fees in connection with the transactions contemplated hereby other
than pursuant to the agreements with Banc of America Securities LLC and ▇.▇.
▇▇▇▇▇▇▇ & Sons, Inc., accurate and complete copies of which have been provided
to Agribrands.
5.14. MATERIAL CONTRACTS.
-------------------
Neither Ralcorp nor any Ralcorp Subsidiary is a party or is subject to any
note, bond, mortgage, indenture, contract, lease, license, agreement,
understanding, instrument, bid or proposal that is required to be described in
or filed as an exhibit to any Ralcorp Securities Filing ("Ralcorp Material
----------------
Contract") that is not so described in or filed as required by the Securities
--------
Act or the Securities Exchange Act, as the case may be. Ralcorp has made
available to Agribrands true and accurate copies of the Ralcorp Material
Contracts. All such Ralcorp Material Contracts are valid and binding and are in
full force and effect and enforceable against Ralcorp or such subsidiary in
accordance with their respective terms, subject to the Enforceability
Exceptions. Except as referenced in Section 5.6 above, (i) no Consent of any
person is needed in order that each such Ralcorp Material Contract shall
continue in full force and effect in accordance with its terms without penalty,
acceleration or rights of early termination by reason of the consummation of the
transactions contemplated by this Agreement, except for Consents the absence of
which would not have a Ralcorp Material Adverse Effect, and (ii) neither Ralcorp
nor any of its subsidiaries is in violation or breach of or default under any
such Ralcorp Material Contract; nor to Ralcorp's knowledge is any other party to
any such Ralcorp Material Contract in violation or breach of or default under
any such Ralcorp Material Contract in each case where such violation or breach
would have a Ralcorp Material Adverse Effect.
5.15. EMPLOYEE BENEFIT PLANS.
------------------------
(a) There are no Benefit Plans maintained or contributed to by Ralcorp
or a Ralcorp Subsidiary under which Ralcorp, a Ralcorp Subsidiary or the
Surviving Corporation could incur any material liability.
(b) With respect to each Benefit Plan (where applicable): Ralcorp has made
available to Agribrands complete and accurate copies of (i) all plan and trust
texts and agreements, insurance contracts and other funding arrangements; (ii)
the most recent annual report on the Form 5500 series; (iii) the most recent
financial statement and/or annual and periodic accounting of plan assets; (iv)
the most recent determination letter received from the IRS; and (v) the most
recent summary plan description as defined in ERISA.
(c) With respect to each Benefit Plan while maintained or contributed
to by Ralcorp or a Ralcorp Subsidiary: (i) if intended to qualify under Code
Sections 401(a) or 403(a), such Benefit Plan has received a favorable
determination letter from the IRS that it so qualifies, and its trust is exempt
from taxation under Code Section 501(a) and, to the knowledge of Ralcorp,
nothing has since occurred to cause the loss of the Benefit Plan's
qualification; (ii) except for payment of benefits made in the ordinary course
of the plan administration, no event has occurred and, to the knowledge of
Ralcorp, there exists no circumstance under which Ralcorp, a Ralcorp Subsidiary
or Holding Company could incur liability under ERISA, the Code or otherwise;
(iii) no accumulated funding deficiency as defined in Code Section 412 has
occurred or exists, whether or not waived; (iv) no non-exempt prohibited
transaction as defined under ERISA and the Code has occurred; (v) no reportable
event as defined in Section 4043 of ERISA has occurred or will occur by virtue
of consummation of the transaction contemplated by this Agreement (other than
events as to which the 30-day notice period is waived pursuant to Section 4043
of ERISA); (vi) all contributions and premiums due including premiums to the
PBGC have fully been made and paid on a timely basis; and (vii) all
contributions made or required to be made under any Benefit Plan meet the
requirements for deductibility under the Code, and all contributions accrued
prior to the Effective Time which have not been made have been properly recorded
on the Ralcorp Financial Statements in a manner satisfying the requirements of
Financial Accounting Standards 87 and 88; (viii) the present value of all
"benefit liabilities" (as defined in ERISA Section 4001(a)(16) and determined
based on the actuarial assumptions and methods used under such Benefit Plan for
the most recent Benefit Plan actuarial valuation and assuming for such purposes
that all benefits provided under the Benefit Plan are fully vested) under each
such Benefit Plan did not exceed as of the most recent Benefit Plan actuarial
valuation date, and will not exceed as of the Closing Date, the then current
value of the assets of such Benefit Plan as determined pursuant to Code Section
412, and (ix) neither Ralcorp nor any Ralcorp Subsidiary has completely or
partially withdrawn from a Plan that is a Multi-employer Plan, and Ralcorp would
not become subject to liability under ERISA if Ralcorp were to withdraw
completely from all multi-employer plans in which it currently participates,
except, in each case, for any deviations from the foregoing which do not and
would not reasonably be expected to have a Ralcorp Material Adverse Effect.
5.16. TAXES AND RETURNS.
-------------------
(a) Ralcorp and each of the Ralcorp Subsidiaries has timely filed
or caused to be filed all material Tax Returns required to be filed by it, and
all Tax Returns filed by Ralcorp and the Ralcorp Subsidiaries are true, complete
and correct in all material respects.
(b) Ralcorp and the Ralcorp Subsidiaries have each timely paid,
collected or withheld, or caused to be timely paid, collected or withheld, all
material amounts of Taxes required to be paid, collected or withheld, other than
such Taxes for which adequate reserves in the Ralcorp Financial Statements have
been established.
(c) There are no claims or assessments pending against Ralcorp or any
of the Ralcorp Subsidiaries for any alleged deficiency in any Tax, and Ralcorp
has not been notified in writing of any proposed Tax claims or assessments
against Ralcorp or any of the Ralcorp Subsidiaries (other than in each case,
claims or assessments for which adequate reserves in the Ralcorp Financial
Statements have been established or which are being contested in good faith or
are immaterial in amount).
(d) There are no material federal, state, local or foreign audits or
administrative proceedings pending with regard to any material amounts of Tax or
Tax Returns of Ralcorp or the Ralcorp Subsidiaries and none of them has received
a written notice of any proposed material audit or proceeding.
(e) Neither Ralcorp nor any of the Ralcorp Subsidiaries has any waivers
or extensions of any applicable statute of limitations to assess any material
amount of Taxes.
(f) There are no outstanding requests by Ralcorp or any of Ralcorp
Subsidiaries for any extension of time within which to file any material Tax
Return or within which to pay any material amounts of Taxes shown to be due on
any return.
(g) There are no liens for material amounts of Taxes on the assets of
Ralcorp or any of Ralcorp Subsidiaries except for statutory liens for current
Taxes not yet due and payable.
(h) Neither Ralcorp nor any Ralcorp Subsidiary is a party to any
agreement, contract, arrangement, or plan that has resulted or would result,
individually or in the aggregate, in connection with this Agreement or any
change of control of Ralcorp or any of Ralcorp Subsidiaries in the payment of
any "excess parachute payments" within the meaning of Section 280G of the Code.
5.17. NO ADVERSE ACTIONS.
--------------------
There is no existing, pending or, to the knowledge of Ralcorp, overtly
threatened termination, cancellation, limitation, modification or change in the
business relationship of Ralcorp or any of the Ralcorp Subsidiaries, with any
supplier, customer or other person except such as would not reasonably be
expected to have a Ralcorp Material Adverse Effect. None of Ralcorp, any
Ralcorp Subsidiary or, to the knowledge of Ralcorp, any director, officer,
agent, employee or other person acting on behalf of any of the foregoing has
used any corporate funds for unlawful contributions, payments, gifts or
entertainment or for the payment of other unlawful expenses relating to
political activity, or made any direct or indirect unlawful payments to
governmental or regulatory officials or others, which would reasonably be
expected to have a Ralcorp Material Adverse Effect.
5.18. FAIRNESS OPINION.
-----------------
Ralcorp's Board of Directors and the Special Committee of the Ralcorp Board
of Directors received from their respective financial advisors, Banc of America
Securities LLC and ▇.▇. ▇▇▇▇▇▇▇ & Sons, Inc., opinions to the effect that the
Merger Consideration is fair to the holders of Ralcorp Common Stock from a
financial point of view.
5.19. TAKEOVER STATUTES AND CHARTER.
--------------------------------
No Takeover Statute, including, without limitation, Sections 351.407 and
351.459 of the Missouri Code, applicable to Ralcorp or any of the Ralcorp
Subsidiaries is applicable to the Ralcorp Merger, this Agreement, the Ralcorp
Ancillary Agreements or the other transactions contemplated hereby or thereby
(inasmuch as Ralcorp has approved the transactions contemplated by this
Agreement and the Ralcorp Ancillary Agreements for purposes of Section 351.459
of the Missouri Code and has taken all other requisite corporate action under
the Takeover Statutes). The provisions of Article Nine of the Articles of
Incorporation of Ralcorp are not applicable to the Ralcorp Merger, this
Agreement, the Ralcorp Ancillary Agreements or the other transactions
contemplated hereby or thereby (inasmuch as there are one or more "Continuing
----------
Directors" (as defined in the Articles of Incorporation of Ralcorp) and the
---------
Ralcorp Merger has been approved by a majority of them).
5.20. RALCORP RIGHTS PLAN.
---------------------
Under the Rights Agreement between Ralcorp and First Chicago Trust Company
of New York (as successor Rights Agent to Boatmen's Trust Company), dated as of
December 27,1996, as amended as of July 1, 1997 and as amended on August 7, 2000
(the "Ralcorp Rights Agreement"), neither Merger Sub R nor Holding Company will
------------------------
not become an "Acquiring Person," no "Stock Acquisition Date" or "Distribution
Date" (as such terms are defined in the Ralcorp Rights Agreement) will occur,
and the holders of any rights issued pursuant to the Ralcorp Rights Agreement
will not be entitled to receive any benefits under the Ralcorp Rights Agreement
as a result of the approval, execution or delivery of this Agreement, the
Ralcorp Merger Agreement or any of the Ralcorp Ancillary Agreements or the
consummation of the transactions contemplated hereby and thereby.
ARTICLE VI.
ADDITIONAL COVENANTS OF AGRIBRANDS
Agribrands covenants and agrees as follows:
6.1. CONDUCT OF BUSINESS OF AGRIBRANDS AND THE AGRIBRANDS SUBSIDIARIES.
---------------------------------------------------------------------
Except as expressly contemplated by this Agreement, disclosed in the
Agribrands Securities Filings filed as of the date hereof or set forth in the
Agribrands Disclosure Schedule, during the period from the date of this
Agreement to the Effective Time, Agribrands shall conduct, and it shall cause
the Agribrands Subsidiaries to conduct, its or their respective businesses in
the ordinary course and consistent with past practice, subject to the
limitations contained in this Agreement, and Agribrands shall, and it shall
cause the Agribrands Subsidiaries to, use its or their respective reasonable
best efforts to preserve intact its or their respective business organizations,
to keep available the services of its or their respective officers, agents and
employees and to maintain satisfactory relationships with all persons with whom
any of them does business. Without limiting the generality of the foregoing,
and except as otherwise expressly provided in this Agreement, after the date of
this Agreement and prior to the Effective Time, neither Agribrands nor any
Agribrands Subsidiary will, without the prior written consent of Ralcorp, which
shall not be unreasonably withheld or delayed:
(i) amend or propose to amend its Articles or Certificate of
Incorporation or Bylaws (or comparable governing instruments) in any material
respect;
(ii) authorize for issuance, issue, grant, sell, pledge, dispose of or
propose to issue, grant, sell, pledge or dispose of any shares of, or any
options, warrants, commitments, subscriptions or rights of any kind to acquire
or sell any shares of, the capital stock or other securities of Agribrands or
any Agribrands Subsidiary including, but not limited to, any securities
convertible into or exchangeable for shares of capital stock of any class of
Agribrands or any Agribrands Subsidiary, except for the issuance of shares of
Agribrands Common Stock pursuant to the exercise of Agribrands Options
outstanding on the date of this Agreement in accordance with their present
terms;
(iii) split, combine or reclassify any shares of its capital stock or
declare, pay or set aside any dividend or other distribution (whether in cash,
stock or property or any combination thereof) in respect of its capital stock,
other than dividends or distributions to Agribrands or an Agribrands Subsidiary
wholly owned by Agribrands, or redeem, purchase or otherwise acquire or offer to
acquire any shares of its capital stock or other securities;
(iv) other than in the ordinary course of business consistent with past
practice, (a) create, incur or assume any debt or obligations in respect of
capital leases, except refinancings of existing obligations on terms and
conditions prevailing in the market; (b) assume, guarantee, endorse or otherwise
become liable or responsible (whether directly, indirectly, contingently or
otherwise) for the obligations of any person; (c) make any capital expenditures
or make any loans, advances or capital contributions to, or investments in, any
other person (other than to an Agribrands Subsidiary and customary travel,
relocation or business advances to employees) made in the ordinary course of
business consistent with past practice; (d) acquire the stock or assets of, or
merge or consolidate with, any other person; (e) voluntarily incur any material
liability or obligation (absolute, accrued, contingent or otherwise); or (f)
sell, transfer, mortgage, pledge or otherwise dispose of, or encumber, or agree
to sell, transfer, mortgage, pledge or otherwise dispose of or encumber, any
assets or properties, real, personal or mixed material to Agribrands and the
Agribrands Subsidiaries taken as a whole other than to secure debt permitted
under (a) of this clause (iv), and except for transfers made for fair and
adequate consideration;
(v) increase in any manner the compensation of any of its officers or
employees or enter into, establish, amend or terminate any employment,
consulting, retention, change in control, collective bargaining, bonus or other
incentive compensation, profit sharing, health or other welfare, stock option or
other equity, pension, retirement, vacation, severance, deferred compensation or
other compensation or benefit plan, policy, agreement, trust, fund or
arrangement with, for or in respect of, any shareholder, officer, director,
other employee, agent, consultant or affiliate other than (a) as required
pursuant to the terms of agreements in effect on the date of this Agreement, (b)
with respect to non-officer employees, such as are in the ordinary course of
business consistent with past practice, or (c) in connection with the
acquisition by Agribrands of another company or business.
(i) enter into any lease or amend any lease of real property other than
in the ordinary course of business consistent with past practice;
(vii) make or rescind any express or deemed election relating to Taxes
of Agribrands, unless required to do so by applicable Law;
(viii) settle or compromise any Tax liability of Agribrands or agree to
an extension of a statute of limitations with respect to the assessment or
determination of Taxes;
(ix) file or cause to be filed any amended Tax Return with respect to
Agribrands or any Agribrands Subsidiaries or file or cause to be filed any claim
for refund of Taxes paid by or on behalf of Agribrands or any Agribrands
Subsidiaries; or
(x) prepare or file any Tax Return of Agribrands inconsistent with past
practice in preparing or filing similar Tax Returns in prior periods or, on any
such Tax Return, take any position, make any election, or adopt any method that
is inconsistent with positions taken, elections made or methods used in
preparing or filing similar Tax Returns in prior periods, in each case except to
the extent required by Law.
Furthermore, Agribrands covenants that from and after the date of this
Agreement, unless Ralcorp shall otherwise expressly consent in writing,
Agribrands shall, and Agribrands shall cause each of the Agribrands Subsidiaries
to, use its or their reasonable business efforts to comply in all material
respects with all Laws applicable to it or any of its properties, assets or
business and maintain in full force and effect all Agribrands Permits necessary
for, or otherwise material to, such business.
6.2. NOTIFICATION OF CERTAIN MATTERS.
----------------------------------
Agribrands shall give prompt notice to Ralcorp if any of the following
occurs after the date of this Agreement: (i) any notice of, or other
communication relating to, a material default or Event which, with notice or
lapse of time or both, would become a material default under any Agribrands
Material Contract; (ii) receipt of any notice or other communication in writing
from any third party alleging that the Consent of such third party is or may be
required in connection with the transactions contemplated by this Agreement,
other than a Consent disclosed pursuant to Section 4.5 or 4.6 above or not
required to be disclosed pursuant to the terms thereof; (iii) receipt of any
material notice or other communication from any Governmental Authority
(including, but not limited to, the NYSE or any other securities exchange) in
connection with the transactions contemplated by this Agreement; (iv) the
occurrence of an Event which would reasonably be expected to have an Agribrands
Material Adverse Effect; (v) the commencement or threat of any Litigation
involving or affecting Agribrands or any Agribrands Subsidiary, or any of their
respective properties or assets, or, to its knowledge, any employee, agent,
director or officer of Agribrands or any Agribrands Subsidiary, in his or her
capacity as such or as a fiduciary under a Benefit Plan of Agribrands, which, if
pending on the date hereof, would have been required to have been disclosed in
or pursuant to this Agreement or which relates to the consummation of the
Agribrands Merger, or any material development in connection with any Litigation
disclosed by Agribrands in or pursuant to this Agreement or the Agribrands
Securities Filings; (vi) the occurrence of any Event that would reasonably be
expected to cause a breach by Agribrands of any provision of this Agreement, and
(vii) the occurrence of any Event that, had it occurred prior to the date of
this Agreement without any additional disclosure hereunder, would have
constituted a breach by Agribrands of any provision of this Agreement.
6.3. ACCESS AND INFORMATION.
------------------------
Between the date of this Agreement and the Effective Time, Agribrands will
give, and will cause each of the Agribrands Subsidiaries to give, and shall
direct its financial advisors, accountants and legal counsel to give, upon
reasonable notice, Ralcorp, its lenders, financial advisors, accountants and
legal counsel and their respective authorized representatives at all reasonable
times access to all offices and other facilities and to all contracts,
agreements, commitments, books and records of or pertaining to Agribrands and
the Agribrands Subsidiaries, will permit the foregoing to make such reasonable
inspections as they may require and will cause its officers promptly to furnish
Ralcorp with (a) such financial and operating data and other information with
respect to the business and properties of Agribrands and the Agribrands
Subsidiaries as Ralcorp may from time to time reasonably request, including, but
not limited to, data and information required for inclusion in the Registration
Statement and/or other Ralcorp securities Law filings, and (b) a copy of each
material report, schedule and other document filed or received by Agribrands or
any of the Agribrands Subsidiaries pursuant to the requirements of applicable
securities laws or the NYSE. The foregoing access will be subject to
restrictions contained in confidentiality agreements to which Agribrands is
subject; provided that Agribrands shall use its reasonable best efforts to
obtain waivers of such restrictions.
6.4. SHAREHOLDER APPROVAL.
---------------------
As soon as practicable, Agribrands will take all steps necessary to duly
call, give notice of, convene and hold a meeting of its shareholders (the
"Agribrands Shareholders Meeting") for the purpose of approving this Agreement
---------------------------------
and the Agribrands Merger and the transactions contemplated hereby and thereby
and for such other purposes as may be necessary or desirable in connection with
effectuating the transactions contemplated hereby (the "Agribrands Proposals").
--------------------
Except as otherwise contemplated by this Agreement and subject to the exercise
of their fiduciary duties, the Board of Directors of Agribrands (i) will
recommend to the shareholders of Agribrands that they approve the Agribrands
Proposals, and (ii) will use its reasonable best efforts to obtain any necessary
approval by Agribrands' shareholders of the Agribrands Proposals including,
without limitation, voting the Agribrands Shares held by such Directors for such
adoption and approval.
6.5. REASONABLE BEST EFFORTS.
-------------------------
Subject to the terms and conditions herein provided, Agribrands agrees to
use its reasonable best efforts to take, or cause to be taken, all actions, and
to do, or cause to be done, all things necessary, proper or advisable to
consummate and make effective as promptly as practicable the Agribrands Merger
and the other transactions contemplated by this Agreement including, but not
limited to (i) obtaining any third party Consent required in connection with the
execution and delivery by Agribrands of this Agreement or the consummation by
Agribrands of the transactions contemplated hereby, (ii) the defending of any
Litigation against Agribrands or any Agribrands Subsidiary challenging this
Agreement or the consummation of the transactions contemplated hereby, (iii)
obtaining all Consents from Governmental Authorities required for the
consummation of the Agribrands Merger and the transactions contemplated hereby,
and (iv) timely making all necessary filings under the HSR Act. Upon the terms
and subject to the conditions hereof, Agribrands agrees to use its reasonable
best efforts to take, or cause to be taken, all actions and to do, or cause to
be done, all things necessary to satisfy the other conditions of the Closing set
forth herein. Agribrands will consult with counsel for Ralcorp as to, and will
permit such counsel to participate in, at Ralcorp's expense, any Litigation
referred to in clause (ii) above brought against or involving Agribrands or any
Agribrands Subsidiary.
6.6. PUBLIC ANNOUNCEMENTS.
---------------------
So long as this Agreement is in effect, Agribrands shall not, and shall
cause its affiliates not to, issue or cause the publication of any press release
or any other announcement with respect to the Mergers, the Agribrands Proposals,
the Ralcorp Proposals or the transactions contemplated by this Agreement without
the consent of Ralcorp which shall not be unreasonably withheld or delayed,
except when such release or announcement is required by applicable Law or any
applicable listing agreement with, or rules or regulations of, the NYSE or any
securities exchange, in which case Agribrands, to the extent practicable, prior
to making such announcement, shall consult with Ralcorp regarding the same.
6.7. COMPLIANCE.
----------
In consummating the Agribrands Merger and the transactions contemplated
hereby, Agribrands shall comply, and/or cause the Agribrands Subsidiaries to
comply or to be in compliance, in all material respects, with all applicable
Laws.
6.8. TAX TREATMENT.
--------------
Agribrands shall use its reasonable best efforts to cause the Ralcorp
Merger and the Agribrands Merger to qualify as either, and will not take any
action which to its knowledge could reasonably be expected to prevent the
Ralcorp Merger and the Agribrands Merger from qualifying as either, a
reorganization under Section 368(a) of the Code or an exchange under Section
351(a) of the Code. Prior to the Effective Time, Agribrands shall provide tax
counsel to Agribrands and Ralcorp rendering an opinion under Section 9.1.8 below
with such certificates concerning such factual matters as such counsel
identifies are relevant to its opinion and will use its reasonable best efforts
to obtain such a certificate from any shareholder of Agribrands identified by
such counsel.
6.9. AGRIBRANDS BENEFIT PLANS.
--------------------------
Between the date of this Agreement and through the Effective Time, no
discretionary award or grant under any Benefit Plan of Agribrands or an
Agribrands Subsidiary shall be made without the consent of Ralcorp which shall
not be unreasonably withheld or delayed, except options for shares of Agribrands
Common Stock (with exercise prices at or above the fair market value of the
underlying shares of Agribrands Common Stock on the date of grant) granted to
employees of Agribrands hired on or after the date of this Agreement in the
ordinary course of business consistent with past practice as heretofore
disclosed to Ralcorp; nor shall Agribrands or an Agribrands Subsidiary take any
action or permit any action to be taken to accelerate the vesting of any
warrants or options previously granted pursuant to any such Benefit Plan except
as specifically required pursuant to the terms thereof as in effect on the date
of this Agreement. Neither Agribrands nor any Agribrands Subsidiary shall make
any amendment to any Benefit Plan or any awards thereunder without the consent
of Ralcorp.
6.10. NO SOLICITATION OF ACQUISITION PROPOSAL.
-------------------------------------------
(a) Agribrands shall not, directly or indirectly, take any action to
(1) encourage (including by way of furnishing nonpublic information), solicit,
initiate or facilitate any Agribrands Acquisition Proposal (as defined in
Section 6.10(c)), (2) enter into any agreement with respect to any Agribrands
Acquisition Proposal or (3) participate in any way in discussions or
negotiations with, or furnish any information to, any person in connection with,
or take any other action to facilitate any inquiries or the making of any
proposal that constitutes, or could reasonably be expected to lead to, any
Agribrands Acquisition Proposal; provided, however, that if the Board of
Directors of Agribrands determines in good faith, after consultation with
outside counsel, that it is necessary to do so to discharge properly its
fiduciary duties to shareholders, Agribrands may, in response to an Agribrands
Acquisition Proposal that such Board determines in good faith is reasonably
likely to result in an Agribrands Superior Proposal (as defined in Section
6.10(c)), and subject to such party's compliance with Section 6.10(b), (A)
furnish information with respect to Agribrands to the person making such
Agribrands Acquisition Proposal pursuant to a customary confidentiality
agreement the terms of which are no more favorable to the other party to such
confidentiality agreement than those in place with Ralcorp and (B) participate
in discussions with respect to such Agribrands Acquisition Proposal. It is
expressly understood and agreed that with respect to the foregoing proviso,
Agribrands' legal and financial advisors shall be able to make inquiries, and
engage in discussions, with any party that has made an Agribrands Acquisition
Proposal (and such party's legal and financial advisors) in order to elicit
information to allow the Board of Directors of Agribrands to determine in good
faith if such Agribrands Acquisition Proposal is reasonably likely to result in
an Agribrands Superior Proposal.
(b) Agribrands will as promptly as practicable communicate to Ralcorp any
inquiry received by it relating to any potential Agribrands Acquisition Proposal
and the material terms of any proposal or inquiry, including the identity of the
person and its affiliates making the same, that it may receive in respect of any
such transaction, or of any such information requested from it or of any such
negotiations or discussions being sought to be initiated with it.
(c) "Agribrands Acquisition Proposal" means any offer or proposal concerning
-------------------------------
any (1) merger, consolidation, business combination, or similar transaction
involving Agribrands, (2) sale, lease or other disposition of assets of
Agribrands representing 20% or more of the consolidated assets of Agribrands and
the Agribrands Subsidiaries, (3) issuance, sale, or other disposition of
(including by way of merger, consolidation, business combination, share
exchange, joint venture, or any similar transaction) securities (or options,
rights or warrants to purchase, or securities convertible into or exchangeable
for, such securities) representing 20% or more of the voting power of Agribrands
or (4) transaction in which any person shall acquire beneficial ownership (as
such term is defined in Rule 13d-3 under the Exchange Act), or the right to
acquire beneficial ownership or any "group" (as such term is defined under the
Exchange Act) shall have been formed which beneficially owns or has the right to
acquire beneficial ownership of, 20% or more of the outstanding voting capital
stock of Agribrands. "Agribrands Superior Proposal" means a bona fide Agribrands
----------------------------
Acquisition Proposal made by a third party which was not solicited by
Agribrands, its subsidiaries, representatives or other affiliates and which, in
the good faith judgment of Agribrands' Board of Directors, taking into account,
to the extent deemed appropriate by Agribrands' Board of Directors, the various
legal, financial and regulatory aspects of the proposal and the person making
such proposal (A) if accepted, is reasonably likely to be consummated, and (B)
if consummated, is reasonably likely to result in a transaction that is more
favorable to Agribrands' shareholders (in their capacity as shareholders), from
a financial point of view, than the transactions contemplated by this Agreement.
(d) If the Agribrands Board of Directors is prepared to accept an
Agribrands Superior Proposal, then Agribrands shall give Ralcorp 48 hours notice
that Agribrands is prepared to accept the Agribrands Superior Proposal, provided
that Agribrands may not definitively accept an Agribrands Superior Proposal
unless Agribrands concurrently therewith terminates this Agreement pursuant to
Section 10.1(f) and, concurrently with such termination, makes the payment
required by Section 10.2(d).
6.11. SEC AND SHAREHOLDER FILINGS.
------------------------------
Agribrands shall send to Ralcorp a copy of all public reports and materials
as and when it sends the same to its shareholders, the SEC or any state or
foreign securities commission.
6.12. AFFILIATE AGREEMENTS.
---------------------
Agribrands shall use reasonable best efforts to ensure that each person who
is or may be an "affiliate" of Agribrands within the meaning of Rule 145
promulgated under the Securities Act shall enter into an agreement in customary
form.
6.13. TAKEOVER STATUTES.
------------------
If any Takeover Statute is or may become applicable to the Agribrands
Merger or the transactions contemplated hereby, Agribrands and the members of
its Board of Directors will grant such approvals and will take such other
actions as are necessary so that the Agribrands Merger and the other
transactions contemplated by this Agreement may be consummated as promptly as
practicable on the terms contemplated hereby and will otherwise act to eliminate
or minimize the effects of any Takeover Statute on the Agribrands Merger and any
of the transactions contemplated hereby.
6.14. COMFORT LETTERS.
----------------
Upon the request of Ralcorp, Agribrands shall use its reasonable best
efforts to provide to Ralcorp on or prior to the Closing Date "comfort letters"
from the independent certified public accountants for Agribrands dated the date
on which the Registration Statement, or last amendment thereto, shall become
effective, and dated the Closing Date, addressed to the Board of Directors of
each of Agribrands and Ralcorp, covering such matters as Ralcorp shall
reasonably request with respect to facts concerning the financial condition of
Agribrands and the Agribrands Subsidiaries as are customary for certified public
accountants to deliver in connection with a transaction similar to the
Agribrands Merger.
6.15. SPIN-OFF COVENANT. Agribrands shall satisfy its post spin-off covenant
------------------
to ▇▇▇▇▇▇▇ Purina Company ("▇▇▇▇▇▇▇ Purina") by delivering to ▇▇▇▇▇▇▇ Purina (i)
--------------
an opinion of tax counsel in form and substance satisfactory to ▇▇▇▇▇▇▇ Purina
(which opinion shall recite that it may be relied upon by Ralcorp) or (ii) a
supplemental ruling from the IRS that the transactions contemplated by this
Agreement would not cause Agribrands' spin-off from ▇▇▇▇▇▇▇ Purina to be a
taxable transaction.
ARTICLE VII.
ADDITIONAL COVENANTS OF RALCORP
Ralcorp covenants and agrees as follows:
7.1. CONDUCT OF BUSINESS OF RALCORP AND THE RALCORP SUBSIDIARIES.
-------------------------------------------------------------------
Except as expressly contemplated by this Agreement, disclosed in the
Ralcorp Securities Filings filed as of the date hereof or set forth in the
Ralcorp Disclosure Schedule, during the period from the date of this Agreement
to the Effective Time, Ralcorp shall conduct, and it shall cause the Ralcorp
Subsidiaries to conduct, its or their respective businesses in the ordinary
course and consistent with past practice, subject to the limitations contained
in this Agreement, and Ralcorp shall, and it shall cause the Ralcorp
Subsidiaries to, use its or their respective reasonable best efforts to preserve
intact its or their respective business organizations, to keep available the
services of its or their respective officers, agents and employees and to
maintain satisfactory relationships with all persons with whom any of them does
business. Without limiting the generality of the foregoing, and except as
otherwise expressly provided in this Agreement, after the date of this Agreement
and prior to the Effective Time, neither Ralcorp nor any Ralcorp Subsidiary
will, without the prior written consent of Agribrands, which shall not be
unreasonably withheld or delayed:
(i) amend or propose to amend its Articles or Certificate of
Incorporation or Bylaws (or comparable governing instruments) in any material
respect;
(ii) authorize for issuance, issue, grant, sell, pledge, dispose of or
propose to issue, grant, sell, pledge or dispose of any shares of, or any
options, warrants, commitments, subscriptions or rights of any kind to acquire
or sell any shares of, the capital stock or other securities of Ralcorp or any
Ralcorp Subsidiary including, but not limited to, any securities convertible
into or exchangeable for shares of capital stock of any class of Ralcorp or any
Ralcorp Subsidiary, except for the issuance of shares of Ralcorp Common Stock
pursuant to the exercise of Ralcorp Options outstanding on the date of this
Agreement in accordance with their present terms;
(iii) split, combine or reclassify any shares of its capital stock or
declare, pay or set aside any dividend or other distribution (whether in cash,
stock or property or any combination thereof) in respect of its capital stock,
other than dividends or distributions to Ralcorp or a Ralcorp Subsidiary wholly
owned by Ralcorp, or redeem, purchase or otherwise acquire or offer to acquire
any shares of its capital stock or other securities;
(iv) other than in the ordinary course of business consistent with past
practice, (a) create, incur or assume any debt or obligations in respect of
capital leases, except refinancings of existing obligations on terms and
conditions prevailing in the market; (b) assume, guarantee, endorse or otherwise
become liable or responsible (whether directly, indirectly, contingently or
otherwise) for the obligations of any person; (c) make any capital expenditures
or make any loans, advances or capital contributions to, or investments in, any
other person (other than to an Ralcorp Subsidiary and customary travel,
relocation or business advances to employees) made in the ordinary course of
business consistent with past practice; (d) acquire the stock or assets of, or
merge or consolidate with, any other person; (e) voluntarily incur any material
liability or obligation (absolute, accrued, contingent or otherwise); or (f)
sell, transfer, mortgage, pledge or otherwise dispose of, or encumber, or agree
to sell, transfer, mortgage, pledge or otherwise dispose of or encumber, any
assets or properties, real, personal or mixed material to Ralcorp and the
Ralcorp Subsidiaries taken as a whole other than to secure debt permitted under
(a) of this clause (iv), and except for transfers made for fair and adequate
consideration; provided that subparagraphs (a), (c), (d) and (e) shall not apply
to acquisitions of businesses, whether by purchase of stock or assets or by
merger or consolidation, or to debt incurred in connection therewith, for cash
consideration in an aggregate amount for all such acquisitions of up to $50
million;
(v) increase in any manner the compensation of any of its officers or
employees or enter into, establish, amend or terminate any employment,
consulting, retention, change in control, collective bargaining, bonus or other
incentive compensation, profit sharing, health or other welfare, stock option or
other equity, pension, retirement, vacation, severance, deferred compensation or
other compensation or benefit plan, policy, agreement, trust, fund or
arrangement with, for or in respect of, any shareholder, officer, director,
other employee, agent, consultant or affiliate other than (a) as required
pursuant to the terms of agreements in effect on the date of this Agreement, (b)
with respect to non-officer employees, such as are in the ordinary course of
business consistent with past practice, or (c) in connection with the
acquisition by Ralcorp of another company or business.
(vi) enter into any lease or amend any lease of real property other than
in the ordinary course of business consistent with past practice;
(vii) make or rescind any express or deemed election relating to Taxes
of Ralcorp, unless required to do so by applicable Law;
(viii) settle or compromise any Tax liability of Ralcorp or agree to an
extension of a statute of limitations with respect to the assessment or
determination of Taxes;
(ix) file or cause to be filed any amended Tax Return with respect to
Ralcorp or any of Ralcorp Subsidiaries or file or cause to be filed any claim
for refund of Taxes paid by or on behalf of Ralcorp or any of Ralcorp
Subsidiaries; or
(x) prepare or file any Tax Return of Ralcorp inconsistent with past
practice in preparing or filing similar Tax Returns in prior periods or, on any
such Tax Return, take any position, make any election, or adopt any method that
is inconsistent with positions taken, elections made or methods used in
preparing or filing similar Tax Returns in prior periods, in each case except to
the extent required by Law.
Furthermore, Ralcorp covenants that from and after the date of this
Agreement, unless Agribrands shall otherwise expressly consent in writing,
Ralcorp shall, and Ralcorp shall cause each of the Ralcorp Subsidiaries to, use
its or their reasonable business efforts to comply in all material respects with
all Laws applicable to it or any of its properties, assets or business and
maintain in full force and effect all Ralcorp Permits necessary for, or
otherwise material to, such business.
7.2. NOTIFICATION OF CERTAIN MATTERS.
----------------------------------
Ralcorp shall give prompt notice to Agribrands if any of the following
occurs after the date of this Agreement: (i) any notice of, or other
communication relating to, a material default or Event which, with notice or
lapse of time or both, would become a material default under any Ralcorp
Material Contract; (ii) receipt of any notice or other communication in writing
from any third party alleging that the Consent of such third party is or may be
required in connection with the transactions contemplated by this Agreement,
other than a Consent disclosed pursuant to Section 5.5 or 5.6 above or not
required to be disclosed pursuant to the terms thereof; (iii) receipt of any
material notice or other communication from any Governmental Authority
(including, but not limited to, the NYSE or any other securities exchange) in
connection with the transactions contemplated by this Agreement; (iv) the
occurrence of an Event which would reasonably be expected to have a Ralcorp
Material Adverse Effect; (v) the commencement or threat of any Litigation
involving or affecting Ralcorp or any Ralcorp Subsidiary, or any of their
respective properties or assets, or, to its knowledge, any employee, agent,
director or officer of Ralcorp or any Ralcorp Subsidiary, in his or her capacity
as such or as a fiduciary under a Benefit Plan of Ralcorp, which, if pending on
the date hereof, would have been required to have been disclosed in or pursuant
to this Agreement or which relates to the consummation of the Ralcorp Merger, or
any material development in connection with any Litigation disclosed by Ralcorp
in or pursuant to this Agreement or the Ralcorp Securities Filings; and (vi) the
occurrence of any Event that would reasonably be expected to cause a breach by
Ralcorp of any provision of this Agreement, and (vii) the occurrence of any
Event that, had it occurred prior to the date of this Agreement without any
additional disclosure hereunder, would have constituted a breach by Ralcorp of
any provision of this Agreement.
7.3. ACCESS AND INFORMATION.
------------------------
Between the date of this Agreement and the Effective Time, Ralcorp will
give, and will cause each of the Ralcorp Subsidiaries to give, and shall direct
its financial advisors, accountants and legal counsel to give, upon reasonable
notice, Agribrands, its lenders, financial advisors, accountants and legal
counsel and their respective authorized representatives at all reasonable times
access to all offices and other facilities and to all contracts, agreements,
commitments, books and records of or pertaining to Ralcorp and the Ralcorp
Subsidiaries, will permit the foregoing to make such reasonable inspections as
they may require and will cause its officers promptly to furnish Ralcorp with
(a) such financial and operating data and other information with respect to the
business and properties of Ralcorp and the Ralcorp Subsidiaries as Agribrands
may from time to time reasonably request, including, but not limited to, data
and information required for inclusion in the Registration Statement and/or
other Ralcorp securities Law filings, and (b) a copy of each material report,
schedule and other document filed or received by Ralcorp or any of the Ralcorp
Subsidiaries pursuant to the requirements of applicable securities laws or the
NYSE. The foregoing access will be subject to restrictions contained in
confidentiality agreements to which Ralcorp is subject; provided that Ralcorp
shall use its reasonable best efforts to obtain waivers of such restrictions.
7.4. SHAREHOLDER APPROVAL.
---------------------
As soon as practicable, Ralcorp will take all steps necessary to duly call,
give notice of, convene and hold a meeting of its shareholders (the "Ralcorp
-------
Shareholders Meeting") for the purpose of approving this Agreement and the
---------------------
Ralcorp Merger and the transactions contemplated hereby and thereby, for such
other purposes as may be necessary or desirable in connection with effectuating
the transactions contemplated hereby and for such other purposes as Ralcorp
shall determine (the "Ralcorp Proposals"). Except as otherwise contemplated by
-----------------
this Agreement and subject to the exercise of their fiduciary duties, the Board
of Directors of Ralcorp (i) will recommend to the shareholders of Ralcorp that
they approve the Ralcorp Proposals, and (ii) will use its reasonable best
efforts to obtain any necessary approval by Ralcorp's shareholders of the
Ralcorp Proposals, including, without limitation, voting the Ralcorp Common
Stock held by such Directors for such approval.
7.5. REASONABLE BEST EFFORTS.
-------------------------
Subject to the terms and conditions herein provided, Ralcorp agrees to use
its reasonable best efforts to take, or cause to be taken, all actions, and to
do, or cause to be done, all things necessary, proper or advisable to consummate
and make effective as promptly as practicable the Ralcorp Merger and the other
transactions contemplated by this Agreement including, but not limited to (i)
obtaining any third party Consent required in connection with the execution and
delivery by Ralcorp of this Agreement or the consummation by Ralcorp of the
transactions contemplated hereby, (ii) the defending of any Litigation against
Ralcorp or any Ralcorp Subsidiary challenging this Agreement or the consummation
of the transactions contemplated hereby, (iii) obtaining all Consents from
Governmental Authorities required for the consummation of the Ralcorp Merger and
the transactions contemplated hereby, and (iv) timely making all necessary
filings under the HSR Act. Upon the terms and subject to the conditions hereof,
Ralcorp agrees to use its reasonable best efforts to take, or cause to be taken,
all actions and to do, or cause to be done, all things necessary to satisfy the
other conditions of the Closing set forth herein. Ralcorp will consult with
counsel for Agribrands as to, and will permit such counsel to participate in, at
Agribrands' expense, any Litigation referred to in clause (ii) above brought
against or involving Ralcorp or any Ralcorp Subsidiary.
7.6. PUBLIC ANNOUNCEMENTS.
---------------------
So long as this Agreement is in effect, Ralcorp shall not, and shall cause
its affiliates not to, issue or cause the publication of any press release or
any other announcement with respect to the Mergers, the Agribrands Proposals,
the Ralcorp Proposals or the transactions contemplated by this Agreement without
the consent of Agribrands which shall not be unreasonably withheld or delayed,
except when such release or announcement is required by applicable Law or any
applicable listing agreement with, or rules or regulations of, the NYSE or any
securities exchange, in which case Ralcorp, to the extent practicable, prior to
making such announcement, shall consult with Agribrands regarding the same.
7.7. COMPLIANCE.
----------
In consummating the Ralcorp Merger and the transactions contemplated
hereby, Ralcorp shall comply and/or cause the Ralcorp Subsidiaries to comply or
to be in compliance, in all material respects, with all applicable Laws.
7.8. TAX TREATMENT.
--------------
Ralcorp shall use its reasonable best efforts to cause the Ralcorp Merger
and the Agribrands Merger to qualify as either, and will not take any action
which to its knowledge could reasonably be expected to prevent the Ralcorp
Merger and the Agribrands Merger from qualifying as either, a reorganization
under Section 368(a) of the Code or as an exchange under Section 351(a) of the
Code. Prior to the Effective Time, Ralcorp shall provide tax counsel to
Agribrands and Ralcorp rendering an opinion under Section 9.1.8 below with such
certificates concerning such factual matters as such counsel identifies are
relevant to its opinion and will use its reasonable best efforts to obtain such
a certificate from any shareholder of Ralcorp identified by such counsel.
7.9. RALCORP BENEFIT PLANS.
-----------------------
Between the date of this Agreement and through the Effective Time, no
discretionary award or grant under any Benefit Plan of Ralcorp or a Ralcorp
Subsidiary shall be made without the consent of Agribrands which shall not be
unreasonably withheld or delayed, except options for shares of Ralcorp Common
Stock (with exercise prices at or above the fair market value of the underlying
shares of Ralcorp Common Stock on the date of grant) granted to employees of
Ralcorp hired on or after the date of this Agreement in the ordinary course of
business consistent with past practice as heretofore disclosed to Agribrands;
nor shall Ralcorp or a Ralcorp Subsidiary take any action or permit any action
to be taken to accelerate the vesting of any warrants or options previously
granted pursuant to any such Benefit Plan except as specifically required
pursuant to the terms thereof as in effect on the date of this Agreement.
Neither Ralcorp nor any Ralcorp Subsidiary shall make any amendment to any
Benefit Plan or any awards thereunder without the consent of Agribrands.
7.10. NO SOLICITATION OF ACQUISITION PROPOSAL.
-------------------------------------------
(a) Ralcorp shall not, directly or indirectly, take any action to (1)
encourage (including by way of furnishing nonpublic information), solicit,
initiate or facilitate any Ralcorp Acquisition Proposal (as defined in Section
7.10(c)), (2) enter into any agreement with respect to any Ralcorp Acquisition
Proposal or (3) participate in any way in discussions or negotiations with, or
furnish any information to, any person in connection with, or take any other
action to facilitate any inquiries or the making of any proposal that
constitutes, or could reasonably be expected to lead to, any Ralcorp Acquisition
Proposal; provided, however, that if the Board of Directors of Ralcorp
determines in good faith, after consultation with outside counsel, that it is
necessary to do so to discharge properly its fiduciary duties to shareholders,
Ralcorp may, in response to a Ralcorp Acquisition Proposal that such Board
determines in good faith is reasonably likely to result in a Ralcorp Superior
Proposal (as defined in Section 7.10(c)), and subject to such party's compliance
with Section 7.10(b), (A) furnish information with respect to Ralcorp to the
person making such Ralcorp Acquisition Proposal pursuant to a customary
confidentiality agreement the terms of which are no more favorable to the other
party to such confidentiality agreement than those in place with Agribrands and
(B) participate in discussions with respect to such Ralcorp Acquisition
Proposal. It is expressly understood and agreed that with respect to the
foregoing proviso, Ralcorp's legal and financial advisors shall be able to make
inquiries, and engage in discussions, with any party that has made a Ralcorp
Acquisition Proposal (and such party's legal and financial advisors) in order to
elicit information to allow the Board of Directors of Ralcorp to determine in
good faith if such Ralcorp Acquisition Proposal is reasonably likely to result
in a Ralcorp Superior Proposal.
(b) Ralcorp will as promptly as practicable communicate to Agribrands any
inquiry received by it relating to any potential Ralcorp Acquisition Proposal
and the material terms of any proposal or inquiry, including the identity of the
person and its affiliates making the same, that it may receive in respect of any
such transaction, or of any such information requested from it or of any such
negotiations or discussions being sought to be initiated with it.
(c) "Ralcorp Acquisition Proposal" means any offer or proposal concerning
---------------------------
any (1) merger, consolidation, business combination, or similar transaction
involving Ralcorp, (2) sale, lease or other disposition of assets of Ralcorp
representing 20% or more of the consolidated assets of Ralcorp and the Ralcorp
Subsidiaries, (3) issuance, sale, or other disposition of (including by way of
merger, consolidation, business combination, share exchange, joint venture, or
any similar transaction) securities (or options, rights or warrants to purchase,
or securities convertible into or exchangeable for, such securities)
representing 20% or more of the voting power of Ralcorp or (4) transaction in
which any person shall acquire beneficial ownership (as such term is defined in
Rule 13d-3 under the Exchange Act), or the right to acquire beneficial ownership
or any "group" (as such term is defined under the Exchange Act) shall have been
formed which beneficially owns or has the right to acquire beneficial ownership
of, 20% or more of the outstanding voting capital stock of Ralcorp. "Ralcorp
-------
Superior Proposal" means a bona fide Ralcorp Acquisition Proposal made by a
------------------
third party which was not solicited by Ralcorp, its subsidiaries,
representatives or other affiliates and which, in the good faith judgment of
Ralcorp's Board of Directors, taking into account, to the extent deemed
appropriate by Ralcorp's Board of Directors, the various legal, financial and
regulatory aspects of the proposal and the person making such proposal (A) if
accepted, is reasonably likely to be consummated, and (B) if consummated, is
reasonably likely to result in a transaction that is more favorable to Ralcorp's
shareholders (in their capacity as shareholders), from a financial point of
view, than the transactions contemplated by this Agreement.
(d) If the Ralcorp Board of Directors is prepared to accept a Ralcorp
Superior Proposal, then Ralcorp shall give Agribrands 48 hours notice that
Ralcorp is prepared to accept the Ralcorp Superior Proposal, provided that
Ralcorp may not definitively accept a Ralcorp Superior Proposal unless Ralcorp
concurrently therewith terminates this Agreement pursuant to Section 10.1(f)
and, concurrently with such termination, makes the payment required by Section
10.2(d).
7.11. SEC AND SHAREHOLDER FILINGS.
------------------------------
Ralcorp shall send to Agribrands a copy of all public reports and materials
as and when it sends the same to its shareholders, the SEC or any state or
foreign securities commission.
7.12. AFFILIATE AGREEMENTS.
---------------------
Ralcorp shall use reasonable best efforts to ensure that each person who is
or may be an "affiliate" of Ralcorp within the meaning of Rule 145 promulgated
under the Securities Act shall enter into an agreement in customary form.
7.13. TAKEOVER STATUTES.
------------------
If any Takeover Statute is or may become applicable to the Ralcorp Merger
or the transactions contemplated hereby, Ralcorp and the members of its Board of
Directors will grant such approvals and will take such other actions as are
necessary so that the Ralcorp Merger and the other transactions contemplated by
this Agreement may be consummated as promptly as practicable on the terms
contemplated hereby and will otherwise act to eliminate or minimize the effects
of any Takeover Statute on the Ralcorp Merger and any of the transactions
contemplated hereby.
7.14. COMFORT LETTERS.
----------------
Upon the request of Agribrands, Ralcorp shall use its reasonable best
efforts to provide to Agribrands on or prior to the Closing Date "comfort
letters" from the independent certified public accountants for Ralcorp and the
Ralcorp Subsidiaries, dated the date on which the Registration Statement, or
last amendment thereto, shall become effective, and dated the Closing Date,
addressed to the Board of Directors of each of Agribrands and Ralcorp, covering
such matters as Agribrands shall reasonably request with respect to facts
concerning the financial condition of Ralcorp and the Ralcorp Subsidiaries as
are customary for certified public accountants to deliver in connection with a
transaction similar to the Ralcorp Merger.
ARTICLE VIII.
ADDITIONAL COVENANTS OF AGRIBRANDS AND RALCORP WITH RESPECT TO HOLDING COMPANY
Agribrands and Ralcorp covenant and agree that they will take the necessary
actions prior to the Effective Time to cause Holding Company to do the
following:
8.1. DIRECTOR AND OFFICER LIABILITY.
(a) Holding Company shall indemnify and hold harmless and advance
expenses to the present and former officers and directors of Agribrands and
Ralcorp, and each person who prior to the Effective Time becomes an officer or
director of Agribrands or Ralcorp (each an "Indemnified Person"), in respect of
------------------
acts or omissions by them in their capacities as such occurring at or prior to
the Effective Time (including, without limitation, for acts or omissions
occurring in connection with this Agreement and the consummation of the Mergers)
to the fullest extent permissible under applicable law (collectively, the
"Indemnified Losses"). Without limiting the generality of the foregoing, the
--------------------
Indemnified Losses shall include reasonable costs of prosecuting a claim under
this Section 8.1(a). Holding Company shall periodically advance or reimburse
each Indemnified Person for all reasonable fees and expenses of counsel
constituting Indemnified Losses as such fees and expenses are incurred; provided
that such Indemnified Person shall agree to promptly repay to Holding Company
the amount of any such reimbursement if it shall be judicially determined by
judgment or order not subject to further appeal or discretionary review that
such Indemnified Person is not entitled to be indemnified by Holding Company in
connection with such matter.
(b) For six years after the Effective Time, Holding Company shall provide
officers' and directors' liability insurance in respect of acts or omissions
occurring prior to the Effective Time (including, without limitation, for acts
or omissions occurring in connection with this Agreement and the consummation of
the Mergers) covering each such Indemnified Person currently covered by
Agribrands' officers' and directors' liability insurance policy (with respect to
officers and directors of Agribrands) or by Ralcorp's officers' and directors'
liability insurance policy (with respect to officers and directors of Ralcorp)
on terms with respect to coverage and amount (including with respect to the
payment of attorney's fees) no less favorable than those of such policy in
effect on the date hereof (which policies have been made available by Agribrands
and Ralcorp to each other and to Holding Company); provided that if the
aggregate annual premiums for such insurance during such period shall exceed
200% of the per annum rate of premium paid by Agribrands (with respect to the
liability insurance policies of the officers and directors of Agribrands) or
Ralcorp (with respect to the liability insurance policies of the officers and
directors of Ralcorp) as of the date hereof for such insurance, then Holding
Company shall provide a policy with the best coverage as shall then be available
at 200% of such rate.
(c) The rights of each Indemnified Person and his or her heirs and legal
representatives under this Section 8.1 shall be in addition to any rights such
Person may have under the articles of incorporation or bylaws of Agribrands
(with respect to the Agribrands officers and directors) or Ralcorp (with respect
to the Ralcorp officers and directors), any agreement providing for
indemnification, or under the laws of the State of Missouri or any other
applicable Laws. These rights shall survive consummation of the Mergers and are
intended to benefit, and shall be enforceable by, each Indemnified Person.
8.2. LISTING OF STOCK.
------------------
Holding Company shall use its reasonable best efforts to cause (i) the
shares of Holding Company Common Stock to be registered under the Securities Act
and issued in connection with the Mergers (and the shares of Holding Company
Common Stock underlying the securities to be issued pursuant to Section 3.5) to
be approved for listing on the NYSE, subject to official notice of issuance, and
(ii) the securities of Agribrands and Ralcorp to be de-listed from NYSE in
connection with the Closing.
8.3. REGISTRATION STATEMENT; PROSPECTUS/PROXY STATEMENT.
-----------------------------------------------------
Agribrands, Ralcorp and Holding Company shall cooperate and promptly
prepare and Holding Company shall file with the SEC as soon as practicable a
Registration Statement on Form S-4 or other applicable form (the "Form S-4")
--------
under the Securities Act, with respect to Holding Company Common Stock issuable
in the Mergers, a portion of which Registration Statement shall also serve as
the joint proxy statement with respect to the Agribrands Shareholder Meeting and
Ralcorp Shareholder Meeting (the "Proxy Statement/Prospectus"). The respective
--------------------------
parties will cause the Proxy Statement/Prospectus and the Form S-4 to comply as
to form in all material respects with the applicable provisions of the
Securities Act, the Exchange Act and the rules and regulations thereunder.
Holding Company shall use all reasonable efforts, and Agribrands and Ralcorp
will cooperate with Holding Company, to have the Form S-4 declared effective by
the SEC as promptly as practicable and to keep the Form S-4 effective as long as
is necessary to consummate the Mergers. Holding Company shall, as promptly as
practicable, provide copies of any written comments received from the SEC with
respect to the Form S-4 to Agribrands and Ralcorp and advise Agribrands and
Ralcorp of any verbal comments with respect to the Form S-4 received from the
SEC. Holding Company shall use its best efforts to obtain, prior to the
effective date of the Form S-4, all necessary state securities law or "Blue Sky"
permits or approvals required to carry out the transactions contemplated by this
Agreement and will pay all expenses incident thereto. Holding Company agrees
that the Proxy Statement/Prospectus and each amendment or supplement thereto at
the time of mailing thereof and at the time of the Agribrands Shareholder
Meeting and Ralcorp Shareholder Meeting, or, in the case of the Form S-4 and
each amendment or supplement thereto, at the time it is filed or becomes
effective, will not include an untrue statement of a material fact or omit to
state a material fact required to be stated therein or necessary to make the
statements therein, in light of the circumstances under which they were made,
not misleading; provided, however, that the foregoing shall not apply to the
extent that any such untrue statement of a material fact or omission to state a
material fact was made by Holding Company in reliance upon and in conformity
with written information concerning Agribrands and/or Ralcorp furnished to
Holding Company by Agribrands and/or Ralcorp specifically for use in the Proxy
Statement/Prospectus. Agribrands and Ralcorp agree that the written information
provided by them for inclusion in the Proxy Statement/Prospectus and each
amendment or supplement thereto, at the time of mailing thereof and at the time
of the Agribrands Shareholder Meeting and Ralcorp Shareholder Meeting, or, in
the case of written information concerning either Agribrands or Ralcorp for
inclusion in the Form S-4 or any amendment or supplement thereto, at the time it
is filed or becomes effective, will not include an untrue statement of a
material fact or omit to state a material fact required to be stated therein or
necessary to make the statements therein, in light of the circumstances under
which they were made, not misleading. No amendment or supplement to the Proxy
Statement/Prospectus will be made by Holding Company without the approval of
Agribrands and Ralcorp. Holding Company will advise Agribrands and Ralcorp,
promptly after it receives notice thereof, of the time when the Form S-4 has
become effective or any supplement or amendment has been filed, the issuance of
any stop order, the suspension of the qualification of the Holding Company
Common Stock issuable in connection with the Mergers for offering or sale in any
jurisdiction, or any request by the SEC for amendment of the Proxy
Statement/Prospectus or the Form S-4 or comments thereon and responses thereto
or requests by the SEC for additional information. Whenever any event or
condition affecting Agribrands or Ralcorp occurs that is required to be set
forth in an amendment or supplement to the Proxy Statement/Prospectus, such
party will promptly inform the other of such occurrence and cooperate in filing
with the SEC or its staff or any other government officials, and in mailing to
shareholders of Agribrands and Ralcorp, such amendment or supplement.
8.4. TAX TREATMENT.
--------------
Holding Company shall use its reasonable best efforts to cause the Ralcorp
Merger and the Agribrands Merger to qualify as either, and will not take any
action which to its knowledge could reasonably be expected to prevent the
Ralcorp Merger and the Agribrands Merger from qualifying as either, a
reorganization under Section 368(a) of the Code or as an exchange under Section
351(a) of the Code. Prior to the Effective Time, Holding Company shall provide
tax counsel to Agribrands and Ralcorp rendering an opinion under Section 9.1.8
below with such certificates concerning such factual matters as such counsel
identifies are relevant to its opinion.
8.5. SHAREHOLDER RIGHTS AGREEMENT.
------------------------------
Holding Company shall use its reasonable best efforts to have adopted prior
to the Effective Time a shareholder rights agreement so that the holders of
Agribrands Common Stock and Ralcorp Common Stock who receive shares of Holding
Company Common Stock pursuant to the terms hereof will also receive associated
rights that are similar to the rights as provided by the Agribrands Rights
Agreement and the Ralcorp Rights Agreement.
ARTICLE IX.
CONDITIONS
9.1. CONDITIONS TO EACH PARTY'S OBLIGATIONS.
------------------------------------------
The respective obligations of each party to effect the Mergers shall be
subject to the fulfillment or waiver on or prior to the Closing Date of the
following conditions:
9.1.1. SHAREHOLDER APPROVALS.
----------------------
The Agribrands Proposals shall have been approved at or prior to the
Effective Time by the requisite vote of the shareholders of Agribrands in
accordance with the Missouri Code and the Agribrands' Articles of Incorporation
and the Ralcorp Proposals shall have been approved by the requisite vote of the
shareholders of Ralcorp in accordance with the Missouri Code and Ralcorp's
Articles of Incorporation.
9.1.2. NO INJUNCTION OR ACTION.
--------------------------
No order, statute, rule, regulation, executive order, stay, decree,
judgment or injunction shall have been enacted, entered, promulgated or enforced
by any court or other Governmental Authority, which prohibits or prevents the
consummation of the Mergers and which has not been vacated, dismissed or
withdrawn by the Effective Time. Agribrands and Ralcorp shall use their
reasonable best efforts to have any of the foregoing vacated, dismissed or
withdrawn on or prior to the Effective Time.
9.1.3 GOVERNMENTAL APPROVALS.
-----------------------
All Consents of any Governmental Authority required for the consummation of
the Mergers and the transactions contemplated by this Agreement shall have been
obtained by Final Order (as hereafter defined), except as may be waived by
Agribrands and Ralcorp or those Consents the failure of which to obtain will not
have a Holding Company Material Adverse Effect (as defined below). The term
"Final Order" with respect to any Consent of a Governmental Authority shall mean
------------
an action by the appropriate Governmental Authority as to which: (i) no request
for stay by such Governmental Authority of the action is pending, no such stay
is in effect, and, if any deadline for filing any such request is designated by
statute or regulation, it has passed; (ii) no petition for rehearing or
reconsideration of the action is pending before such Governmental Authority, and
no appeal or comparable administrative remedy with such or any other
Governmental Authority is pending before such Governmental Authority, and the
time for filing any such petition, appeal or administrative remedy has passed;
(iii) such Governmental Authority does not have the action under reconsideration
on its own motion and the time for such reconsideration has passed; and (iv) no
appeal to a court, or request for stay by a court, of the Governmental Authority
action is pending or in effect, and if any deadline for filing any such appeal
or request is designated by statute or rule, it has passed.
9.1.4 HSR ACT.
--------
The waiting period applicable to the Mergers under the HSR Act shall have
expired or earlier termination thereof shall have been granted, and no action,
suit, proceeding or investigation shall have been instituted by either the
United States Department of Justice or the Federal Trade Commission to prevent
the consummation of the transactions contemplated by this Agreement or to modify
or amend such transactions in any material manner, or if any such action shall
have been instituted, it shall have been withdrawn or a Final Order having the
effect of permitting the consummation of the transactions contemplated by this
Agreement shall have been entered against such Department or Commission, as the
case may be.
9.1.5. REQUIRED CONSENTS.
------------------
Any required Consents of any person to the Mergers or the transactions
contemplated hereby as described in Sections 4.5, 4.6, 5.5 and 5.6 shall have
been obtained and be in full force and effect, except for those the failure of
which to obtain will not have a material adverse effect on the business, assets
(including, but not limited to, intangible assets), prospects, condition
(financial or otherwise), properties (including, but not limited to, intangible
properties), liabilities or the result of operations of the Holding Company and
its subsidiaries taken as a whole ("Holding Company Material Adverse Effect").
---------------------------------------
9.1.6. REGISTRATION STATEMENT.
-----------------------
The Registration Statement shall have been declared effective and no stop
order suspending the effectiveness of the Registration Statement shall have been
issued and no action, suit, proceeding or investigation for that purpose shall
have been initiated or threatened by any Governmental Authority.
9.1.7. SPIN-OFF COVENANT.
------------------
Agribrands shall have satisfied its post spin-off covenant to ▇▇▇▇▇▇▇
Purina by delivering to ▇▇▇▇▇▇▇ Purina (i) an opinion of tax counsel in form and
substance satisfactory to ▇▇▇▇▇▇▇ Purina (which opinion shall recite that it may
be relied upon by Ralcorp) or (ii) a supplemental ruling from the IRS that the
transactions contemplated by this Agreement would not cause Agribrands' spin-off
from ▇▇▇▇▇▇▇ Purina to be a taxable transaction.
9.1.8. TAX OPINION.
------------
Ralcorp shall have received an opinion from its tax counsel, in form and
substance reasonably satisfactory to Ralcorp and on the basis of facts,
representations and assumptions set forth in such opinion, substantially to the
effect that the Ralcorp Merger will qualify either as a reorganization within
the meaning of Section 368(a) of the Code or, taken together with the Agribrands
Merger, as an exchange under Section 351(a) of the Code, and Agribrands shall
have received an opinion from its tax counsel, in form and substance reasonably
satisfactory to Ralcorp and on the basis of facts, representations and
assumptions set forth in such opinion, substantially to the effect that the
Agribrands Merger will qualify either as a reorganization within the meaning of
Section 368(a) of the Code or, taken together with the Ralcorp Merger, as an
exchange under Section 351(a) of the Code.
9.1.9. DISSENTING SHARES.
------------------
At the Effective Time, the Agribrands Dissenting Shares shall not exceed 5%
of the outstanding shares of Agribrands Common Stock and the Ralcorp Dissenting
Shares shall not exceed 5% of the outstanding shares of Ralcorp Common Stock.
9.1.10. HOLDING COMPANY ACTS.
----------------------
Holding Company shall have done each of the things required for it to do
pursuant to Article VIII of this Agreement.
9.2. CONDITIONS TO OBLIGATIONS OF AGRIBRANDS.
-------------------------------------------
The obligation of Agribrands to effect the Agribrands Merger shall be
subject to the fulfillment on or prior to the Closing Date of the following
additional conditions, any one or more of which may be waived by Agribrands:
9.2.1. RALCORP REPRESENTATIONS AND WARRANTIES.
-----------------------------------------
As of the Closing Date, none of the representations or warranties of
Ralcorp contained in this Agreement, disregarding any qualifications herein
regarding materiality or Ralcorp Material Adverse Effect, shall be untrue or
incorrect as of the Closing Date, except to the extent such representations and
warranties speak as of an earlier date, to the extent that such untrue or
incorrect representations or warranties, when taken together as a whole, have
had or would reasonably be expected to have a Ralcorp Material Adverse Effect.
9.2.2. PERFORMANCE BY RALCORP.
------------------------
Ralcorp shall have performed and complied with all of the covenants and
agreements in all material respects and satisfied in all material respects all
of the conditions required by this Agreement to be performed or complied with or
satisfied by Ralcorp on or prior to the Closing Date.
9.2.3. NO MATERIAL ADVERSE CHANGE.
-----------------------------
There shall not have occurred after the date hereof any Event (except for
those Events caused by (y) conditions affecting the store brand and value brand
grocery product industry in the regions in which Ralcorp operates or (z) the
pendency or announcement of this Agreement, or the transactions contemplated
hereby) that has had or reasonably would be expected to have a Ralcorp Material
Adverse Effect.
9.2.4. CERTIFICATES AND OTHER DELIVERIES.
------------------------------------
Ralcorp shall have delivered to Agribrands (i) a certificate executed on
its behalf by its Chief Executive Officer to the effect that the conditions set
forth in Subsections 9.2.1, 9.2.2 and 9.2.3, above, have been satisfied; (ii) a
certificate of good standing from the Secretary of State of the State of
Missouri stating that Ralcorp is a validly existing corporation in good
standing; (iii) duly adopted resolutions of the Board of Directors of Ralcorp
approving the execution, delivery and performance of this Agreement and the
instruments contemplated hereby and of the shareholders of Ralcorp approving the
Ralcorp Proposals, each certified by the Secretary or an Assistant Secretary of
Ralcorp; (iv) a true and complete copy of the Articles of Incorporation of
Ralcorp certified by the Secretary of State of the State of Missouri, and a true
and complete copy of the Bylaws of Ralcorp certified by the Secretary or an
Assistant Secretary of Ralcorp; (v) the certificate referred to in Section 8.5
hereof; and (vi) such other documents and instruments as Agribrands reasonably
may request.
9.2.5. OPINION OF RALCORP COUNSEL.
-----------------------------
Agribrands shall have received a customary opinion of counsel to Ralcorp,
in form and substance reasonably satisfactory to Agribrands.
9.3 CONDITIONS TO OBLIGATIONS OF RALCORP.
----------------------------------------
The obligations of Ralcorp to effect the Ralcorp Merger shall be subject to
the fulfillment on or prior to the Closing Date of the following additional
conditions, any one or more of which may be waived by Ralcorp:
9.3.1. AGRIBRANDS REPRESENTATIONS AND WARRANTIES.
--------------------------------------------
As of the Closing Date, none of the representations or warranties of
Agribrands contained in this Agreement, disregarding any qualifications herein
regarding materiality or Agribrands Material Adverse Effect shall be untrue or
incorrect as of the Closing Date, except to the extent such representations and
warranties speak as of an earlier date, to the extent that such untrue or
incorrect representations or warranties, when taken together as a whole, have
had or would reasonably be expected to have an Agribrands Material Adverse
Effect.
9.3.2. PERFORMANCE BY AGRIBRANDS.
---------------------------
Agribrands shall have performed and complied with all the covenants and
agreements in all material respects and satisfied in all material respects all
the conditions required by this Agreement to be performed or complied with or
satisfied by Agribrands on or prior to the Closing Date.
9.3.3. NO MATERIAL ADVERSE CHANGE.
-----------------------------
There shall have not occurred after the date hereof any Event (except for
those Events caused by (x) conditions affecting national, regional or world
economies such as currency fluctuations (but excluding extraordinary disruptions
in regional or world economies or markets or US/foreign currency exchange ratios
involving multiple countries), (y) conditions affecting the animal feed industry
in the regions in which Agribrands operates, or (z) the pendency or announcement
of this Agreement, or the transactions contemplated hereby) that has had or
reasonably would be expected to have an Agribrands Material Adverse Effect.
9.3.4. CERTIFICATES AND OTHER DELIVERIES.
------------------------------------
Agribrands shall have delivered, or caused to be delivered, to Ralcorp (i)
a certificate executed on its behalf by its Chief Executive Officer to the
effect that the conditions set forth in Subsections 9.3.1, 9.3.2 and 9.3.3,
above, have been satisfied; (ii) a certificate of good standing from the
Secretary of State of the State of Missouri stating that Agribrands is a validly
existing corporation in good standing; (iii) duly adopted resolutions of the
Board of Directors of Agribrands approving the execution, delivery and
performance of this Agreement and the instruments contemplated hereby and of the
shareholders of Agribrands approving the Agribrands Proposals, certified by the
Secretary or an Assistant Secretary of Agribrands; (iv) a true and complete copy
of the Articles of Incorporation of Agribrands certified by the Secretary of
State of the State of Missouri, and a true and complete copy of the Bylaws of
Agribrands certified by the Secretary or an Assistant Secretary of Agribrands;
(v) the certificate referred to in Section 8.5 hereof; and (vi) such other
documents and instruments as Ralcorp reasonably may request.
9.3.5. OPINION OF AGRIBRANDS COUNSEL.
--------------------------------
Ralcorp shall have received the opinion of counsel to Agribrands, in form
and substance reasonably satisfactory to Ralcorp.
ARTICLE X.
TERMINATION AND ABANDONMENT
10.1. TERMINATION.
-----------
This Agreement may be terminated at any time prior to the Effective Time,
whether before or after approval of this Agreement and the Mergers by the
shareholders of Agribrands and the shareholders of Ralcorp:
(a) by mutual consent of Agribrands and Ralcorp;
(b) (1) by Agribrands (provided that Agribrands is not then in
material breach of any representation, warranty, covenant or other agreement
contained herein), if there has been a breach by Ralcorp of any of its
representations, warranties, covenants or agreements contained in this
Agreement, or any such representation and warranty shall have become untrue, in
any such case such that Section 9.2.1 or Section 9.2.2 will not be satisfied
and, in either such case, such breach or condition has not been promptly cured
within 30 days following receipt by Ralcorp of written notice of such breach;
(2) by Ralcorp (provided that Ralcorp is not then in material breach of any
representation, warranty, covenant or other agreement contained herein), if
there has been a breach by Agribrands of any of its representations, warranties,
covenants or agreements contained in this Agreement, or any such representation
and warranty shall have become untrue, in any such case such that Section 9.3.1
or Section 9.3.2 will not be satisfied and such breach or condition has not been
promptly cured within 30 days following receipt by Agribrands of written notice
of such breach;
(c) by either Ralcorp or Agribrands if any decree, permanent injunction,
judgment, order or other action by any court of competent jurisdiction, any
arbitrator or any Governmental Authority preventing or prohibiting consummation
of the Mergers shall have become final and nonappealable (so long as the party
seeking termination is not in breach of Section 6.5 or Section 7.5 hereof);
(d) by either Ralcorp or Agribrands if the Mergers shall not have been
consummated before March 31, 2001 unless the failure of the Effective Time to
occur by such date shall be due to the failure of the party seeking to terminate
this Agreement to perform or observe in all material respects the covenants and
agreements of such party set forth herein;
(e) by either Ralcorp or Agribrands if the transactions contemplated by
this Agreement shall fail to receive the requisite vote for approval and
adoption (1) by the shareholders of Agribrands at the Agribrands Shareholders
Meeting or any adjournment or postponement thereof or (2) by the shareholders of
Ralcorp at the Ralcorp Shareholders Meeting or any adjournment or postponement
thereof; provided that the right to terminate this Agreement under this Section
10.1(e) shall not be available to any party whose failure to fulfill any
obligation under this Agreement has been the cause of, or resulted in, the
failure of such approval to have been obtained;
(f) By either Agribrands or Ralcorp concurrently with its acceptance of a
Superior Proposal; or
(g) By either Agribrands or Ralcorp, if the Board of Directors of the
other shall have withdrawn, or modified or changed in a manner adverse to the
terminating party its approval or recommendation of the Agribrands or Ralcorp
Merger and/or the Agribrands or Ralcorp Proposals, each as the case may be.
10.2. EFFECT OF TERMINATION.
-----------------------
(a) In the event of the termination of this Agreement by either
Agribrands or Ralcorp pursuant to Section 10.1, this Agreement shall forthwith
become void, there shall be no liability under this Agreement on the part of
Ralcorp or Agribrands, other than the provisions of this Section 10.2, Section
11.1 and Section 11.7, and except to the extent that such termination results
from the willful and material breach by a party of any of its representations,
warranties, covenants or agreements set forth in this Agreement.
(b) Agribrands and Ralcorp agree that Ralcorp shall pay to Agribrands the
sum of $5 million (the "Agribrands Termination Fee") solely as follows: (1) if
--------------------------
all of the following occur (A) Agribrands or Ralcorp shall terminate this
Agreement pursuant to Section 10.1(d) or (e)(2), in either case where Ralcorp's
shareholders have failed to approve the transactions contemplated by this
Agreement and, if the Agribrands Shareholders Meeting has been held, Agribrands'
shareholders have approved such transactions, (B) at any time after the date of
this Agreement and prior to Ralcorp Shareholders Meeting, if any, there shall
have been publicly announced a Ralcorp Acquisition Proposal, (C) Agribrands
shall not at any time prior to the Agribrands Shareholders Meeting have
withdrawn, or modified or changed in a manner adverse to Ralcorp, its approval
or recommendation of the Agribrands Merger and (D) within nine months of the
termination of this Agreement, Ralcorp enters into a definitive agreement with
respect to such Ralcorp Acquisition Proposal, (2) if Ralcorp shall terminate
this Agreement pursuant to Section 10.1(f), or (3) if Agribrands shall terminate
this Agreement pursuant to Section 10.1(g), unless Ralcorp's Board of Directors'
withdrawal, or modification or change to its approval or recommendation of the
Ralcorp Merger and/or the Ralcorp Proposals was as a result of any Event (except
for those Events caused by (x) conditions affecting national, regional or world
economies such as currency fluctuations (but excluding extraordinary disruptions
in regional or world economies or markets or US/foreign currency exchange ratios
involving multiple countries), (y) conditions affecting the animal feed industry
in the regions in which Agribrands operates, or (z) the pendency or announcement
of this Agreement, or the transactions contemplated hereby) that has had or
reasonably would be expected to have an Agribrands Material Adverse Effect.
(c) The Agribrands Termination Fee required to be paid pursuant to Section
10.2(b)(1) shall be paid to Agribrands not later than five Business Days after
Ralcorp enters into a definitive agreement with respect to a Ralcorp Acquisition
Proposal. The Agribrands Termination Fee to be paid to Agribrands pursuant to
Section 10.2(b)(2) shall be paid to Agribrands concurrently with notice of
termination of this Agreement by Ralcorp. The Agribrands Termination Fee to be
paid to Agribrands pursuant to Section 10.2(b)(3) shall be paid to Agribrands no
later than five Business Days after Ralcorp's receipt of notice of termination
of this Agreement by Agribrands. All payments under Section 10.2 (b) shall be
made by wire transfer of immediately available funds to an account designated by
Agribrands.
(d) Agribrands and Ralcorp agree that Agribrands shall pay to Ralcorp the
sum of $5 million (the "Ralcorp Termination Fee") solely as follows: (1) if all
-----------------------
of the following occur (A) Agribrands or Ralcorp shall terminate this Agreement
pursuant to Section 10.1(d) or (e)(1), in either case where Agribrands'
shareholders have failed to approve the transactions contemplated by this
Agreement and, if the Ralcorp Shareholders Meeting has been held, Ralcorp's
shareholders have approved such transactions, (B) at any time after the date of
this Agreement and prior to Agribrands Shareholders Meeting, if any, there shall
have been publicly announced an Agribrands Acquisition Proposal, (C) Ralcorp
shall not at any time prior to the Ralcorp Shareholders Meeting have withdrawn,
or modified or changed in a manner adverse to Agribrands, its approval or
recommendation of the Ralcorp Merger and (D) within nine months of the
termination of this Agreement, Agribrands enters into a definitive agreement
with respect to such Agribrands Acquisition Proposal, (2) if Agribrands shall
terminate this Agreement pursuant to Section 10.1(f), or (3) if Ralcorp shall
terminate this Agreement pursuant to Section 10.1(g), unless Agribrands' Board
of Directors' withdrawal, or modification or change to its approval or
recommendation of the Agribrands Merger and/or the Agribrands Proposals was as a
result of any Event (except for those Events caused by (y) conditions affecting
the store brand and value brand grocery product industry in the regions in which
Ralcorp operates, or (z) the pendency or announcement of this Agreement, or the
transactions contemplated hereby) that has had or reasonably would be expected
to have a Ralcorp Material Adverse Effect.
(e) The Ralcorp Termination Fee required to be paid pursuant to Section
10.2(d)(1) shall be paid to Ralcorp not later than five Business Days after
Agribrands enters into a definitive agreement with respect to an Agribrands
Acquisition Proposal. The Ralcorp Termination Fee to be paid pursuant to
Section 10.2(d)(2) shall be paid to Ralcorp concurrently with notice of
termination of this Agreement by Agribrands. The Ralcorp Termination Fee to be
paid to Ralcorp pursuant to Section 10.2(d)(3) shall be paid to Ralcorp no later
than five Business Days after Agribrands' receipt of notice of termination of
this Agreement by Ralcorp. All payments under Section 10.2(d) shall be made by
wire transfer of immediately available funds to an account designated by
Ralcorp.
ARTICLE XI.
MISCELLANEOUS
11.1. CONFIDENTIALITY.
---------------
Unless (i) otherwise expressly provided in this Agreement, (ii) required by
applicable Law, (iii) necessary to secure any required Consents as to which the
other party has been advised, or (iv) consented to in writing by Ralcorp and
Agribrands, this Agreement and any information or documents furnished in
connection herewith shall be kept strictly confidential by Agribrands and the
Agribrands Subsidiaries, Ralcorp and the Ralcorp Subsidiaries, and their
respective officers, directors, employees and agents. Prior to any disclosure
pursuant to the preceding sentence, the party intending to make such disclosure
shall consult with the other party to the extent practicable regarding the
nature and extent of the disclosure. Subject to the preceding sentence, nothing
contained herein shall preclude disclosures to the extent necessary to comply
with accounting, SEC and other disclosure obligations imposed by applicable Law.
To the extent required by such disclosure obligations, Ralcorp or Agribrands,
after consultation with the other party to the extent practicable, may file with
the SEC any written communications relating to the Mergers and the transactions
contemplated hereby pursuant to Rule 425 promulgated under the Securities Act.
Ralcorp and Agribrands shall cooperate with the other and provide such
information and documents as may be required in connection with any such
filings. In the event the Mergers are not consummated, Ralcorp and Agribrands
shall return to the other all documents furnished by the other and all copies
thereof made by such party and will hold in absolute confidence all information
obtained from the other party except to the extent (i) such party is required to
disclose such information by Law or such disclosure is necessary in connection
with the pursuit or defense of a claim, (ii) such information was known by such
party prior to such disclosure or was thereafter developed or obtained by such
party independent of such disclosure, (iii) such party received such information
on a non-confidential basis from a source, other than the other party, which is
not known by such party to be bound by a confidentiality obligation with respect
thereto or (iv) such information becomes generally available to the public or is
otherwise no longer confidential. Prior to any disclosure of information
pursuant to the exception in clause (i) of the preceding sentence, the party
intending to disclose the same shall so notify the party which provided the same
to the extent practicable in order that such party may seek a protective order
or other appropriate remedy should it choose to do so.
11.2. AMENDMENT AND MODIFICATION.
----------------------------
To the extent permitted by applicable Law, this Agreement may be amended,
modified or supplemented only by a written agreement among Agribrands, Ralcorp
and Holding Company, whether before or after approval of this Agreement and the
Merger Agreement by the shareholders of Agribrands and Ralcorp, except that
following approval by the shareholders of either Agribrands or Ralcorp, there
shall be no amendment or change to the provisions hereof with respect to the
Merger Consideration without further approval by such approving shareholders,
and no other amendment shall be made which by law requires further approval by
such shareholders without such further approval.
11.3. WAIVER OF COMPLIANCE; CONSENTS.
---------------------------------
Any failure of Agribrands on the one hand, or Ralcorp on the other hand, to
comply with any obligation, covenant, agreement or condition herein may be
waived by Ralcorp on the one hand, or Agribrands on the other hand, only by a
written instrument signed by the party granting such waiver, but such waiver or
failure to insist upon strict compliance with such obligation, covenant,
agreement or condition shall not operate as a waiver of, or estoppel with
respect to, any subsequent or other failure. Any failure of the Holding Company
to comply with any obligation, covenant, agreement or condition herein may be
waived only by a written instrument signed by both Ralcorp and Agribrands, but
such waiver or failure to insist upon strict compliance with such obligation,
covenant, agreement or condition shall not operate as a waiver of, or estoppel
with respect to, any subsequent or other failure. Whenever this Agreement
requires or permits consent by or on behalf of any party hereto, such consent
shall be given in writing in a manner consistent with the requirements for a
waiver of compliance as set forth in this Section 11.3.
11.4. SURVIVAL OF REPRESENTATIONS AND WARRANTIES.
----------------------------------------------
The respective representations and warranties of Agribrands and Ralcorp
contained herein or in any certificates or other documents delivered prior to or
at the Closing shall survive the execution and delivery of this Agreement,
notwithstanding any investigation made or information obtained by the other
party, but shall terminate at the Effective Time.
11.5. NOTICES.
-------
All notices and other communications hereunder shall be in writing and
shall be deemed to have been duly given when delivered in person, by facsimile,
receipt confirmed, or on the next business day when sent by overnight courier or
on the second succeeding business day when sent by registered or certified mail
(postage prepaid, return receipt requested) to the respective parties at the
following addresses (or at such other address for a party as shall be specified
by like notice):
(i) if to Agribrands, to:
Agribrands International, Inc.
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇.
▇▇. ▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Chairman of the Board, Chief Executive
Officer and President
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to:
▇▇▇▇▇▇ & ▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇ ▇▇▇▇▇, Esq.
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
and with a copy to:
▇▇▇▇▇ ▇▇▇▇ LLP
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇. ▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇ ▇. ▇▇▇▇▇, Esq.
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
and
(ii) if to Ralcorp, to:
Ralcorp Holdings, Inc.
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇. ▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Chief Executive Officer
and President
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to:
▇▇▇▇▇▇, ▇▇▇▇ & ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇, Esq.
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
and with a copy to:
▇▇▇▇▇ ▇▇▇▇ LLP
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇. ▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇ ▇. ▇▇▇▇▇, Esq.
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
11.6. BINDING EFFECT; ASSIGNMENT.
----------------------------
This Agreement and all of the provisions hereof shall be binding upon and
inure to the benefit of the parties hereto and their respective successors and
permitted assigns. Neither this Agreement nor any of the rights, interests or
obligations hereunder shall be assigned by any of the parties hereto prior to
the Effective Time without the prior written consent of the other parties
hereto.
11.7. EXPENSES.
--------
All costs and expenses incurred in connection with this Agreement and the
transactions contemplated hereby shall be paid by the party incurring such costs
or expenses, provided, however, that each of Ralcorp and Agribrands shall pay
one-half of the expenses related to printing, filing and mailing the Form S-4
and the Proxy Statement/Prospectus, the fees and expenses of ▇▇▇▇▇ ▇▇▇▇ LLP and
all SEC and other regulatory filing fees incurred in connection with the Mergers
or the issuance of the Holding Company Common Stock. Without limiting the
generality of the foregoing, Agribrands agrees to pay all fees and expenses
incurred in connection with obtaining the IRS supplemental ruling or opinion of
tax counsel referred to in Section 6.15 above.
11.8. GOVERNING LAW.
--------------
This Agreement shall be deemed to be made in, and in all respects shall be
interpreted, construed and governed by and in accordance with the internal laws
of, the State of Missouri, and the parties hereto consent to the jurisdiction of
the courts of or in the State of Missouri in connection with any dispute or
controversy relating to or arising out of this Agreement and the transactions
contemplated hereby.
11.9. COUNTERPARTS.
------------
This Agreement may be executed in counterparts, each of which shall be
deemed an original, but all of which together shall constitute one and the same
instrument.
11.10. INTERPRETATION.
--------------
The article and section headings contained in this Agreement are solely for
the purpose of reference, are not part of the agreement of the parties and shall
not in any way affect the meaning or interpretation of this Agreement. No rule
of construction shall apply to this Agreement which construes ambiguous language
in favor of or against any party by reason of that party's role in drafting this
Agreement. As used in this Agreement, (i) the term "person" shall mean and
------
include an individual, a partnership, a joint venture, a corporation, a limited
liability company, a trust, an association, an unincorporated organization, a
Governmental Authority and any other entity; (ii) the term "Affiliate," with
---------
respect to any person, shall mean and include any person controlling, controlled
by or under common control with such person; and (iii) the term "subsidiary" of
----------
any specified person shall mean any corporation 50 percent or more of the
outstanding voting power of which, or any partnership, joint venture, limited
liability company or other entity 50 percent or more of the total equity
interest of which, is directly or indirectly owned by such specified person.
11.11. ENTIRE AGREEMENT.
-----------------
This Agreement and the other agreements, documents or instruments referred
to herein or executed in connection herewith including, but not limited to, the
Agribrands Disclosure Schedule and Ralcorp Disclosure Schedule, which schedules
are incorporated herein by reference, embody the entire agreement and
understanding of the parties hereto in respect of the subject matter contained
herein. There are no restrictions, promises, representations, warranties,
covenants, or undertakings, other than those expressly set forth or referred to
herein. This Agreement supersedes all prior agreements and the understandings
between the parties with respect to such subject matter.
11.12. SPECIFIC PERFORMANCE.
---------------------
The parties hereto agree that irreparable damage would occur in the event
that any of the provisions in this Agreement were not performed in accordance
with their specific terms or were otherwise breached. Accordingly, the parties
further agree that each party shall be entitled to an injunction or restraining
order to prevent breaches hereof or thereof and to enforce specifically the
terms and provisions hereof or thereof in any court of the United States or any
state having jurisdiction, this being in addition to any other right or remedy
to which such party may be entitled under this Agreement, at law or in equity.
11.13. THIRD PARTIES.
--------------
Nothing contained in this Agreement or in any instrument or document
executed by any party in connection with the transactions contemplated hereby
shall create any rights in, or be deemed to have been executed for the benefit
of, any person that is not a party hereto or thereto, or, a successor or
permitted assign of such a party; provided, however, that the parties hereto
specifically acknowledge that the provisions of Section 8.1 above, are intended
to be for the benefit of, and shall enforceable by, the officers and directors
of Agribrands and/or the Agribrands Subsidiaries and of Ralcorp and/or the
Ralcorp Subsidiaries affected thereby and their heirs and representatives.
[Remainder of Page Intentionally Left Blank]
IN WITNESS WHEREOF, Agribrands and Ralcorp have caused this Agreement to be
signed and delivered by their respective duly authorized officers as of the date
first above written.
AGRIBRANDS INTERNATIONAL, INC.
By: /s/ ▇. ▇. ▇▇▇▇▇▇▇
-------------------
Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Title: Chief Executive Officer
RALCORP HOLDINGS, INC.
By: /s/ J. R. ▇▇▇▇▇▇▇▇▇▇
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Name: J. R. ▇▇▇▇▇▇▇▇▇▇
Title: Chief Executive Officer and President
Schedule 1.2
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DIRECTORS OF HOLDING COMPANY
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▇▇▇▇ ▇. ▇▇▇▇▇▇▇
M. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
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▇. ▇▇▇▇▇ ▇▇▇▇▇▇▇
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EXHIBIT A
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FORM OF
AGREEMENT AND PLAN OF MERGER
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AGREEMENT AND PLAN OF MERGER (the "Agreement"), dated
_________, 2000, between [Agribrands International, Inc./Ralcorp Holdings,
Inc.], a Missouri corporation (the "Company"), and Merger Sub ____, a Missouri
corporation ("Merger Sub ___").
WHEREAS, the Company has entered into an Agreement and Plan of
Reorganization dated as of August __, 2000 by and between _____, Inc., a
Missouri corporation ("_____") and the Company (the "Reorganization Agreement")
pursuant to which the Company and _____ agreed to form a holding company (the
"Holding Company") and the Company and _____ each agreed to merge with separate
wholly owned subsidiaries of Holding Company; and
WHEREAS, Holding Company formed Merger Sub __ for such purpose;
and
WHEREAS, the Board of Directors of Merger Sub ___ and the Board of
Directors of the Company deem it advisable and in the best interests of the
Company and Merger Sub ____ respectively that Merger Sub ___ merge with and into
the Company, in accordance with Section 351.410 of The General and Business
Corporation Law of Missouri (the "Missouri Code"), upon the terms and subject to
the conditions of the Reorganization Agreement and this Agreement, and have
approved and adopted the Reorganization Agreement and this Agreement.
NOW, THEREFORE, in consideration of the premises and of the
mutual covenants and agreements herein contained, the parties hereby agree,
subject to the terms and conditions hereinafter set forth, as follows:
ARTICLE I
THE MERGER
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SECTION 1.01. THE MERGER. Upon the terms and conditions hereof,
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and in accordance with the provisions of the Missouri Code, Merger Sub ____
shall be merged with and into the Company (the "Merger") and the Company shall
be the surviving entity in the Merger (in this capacity, the "Surviving
Entity"). The Company shall continue its corporate existence under the laws of
the State of Missouri and shall become a direct, wholly owned subsidiary of
Holding Company.
SECTION 1.02. EFFECTIVE TIME. As soon as practicable after
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approval of the transactions contemplated by the Reorganization Agreement,
Articles of Merger with respect to the Merger shall be filed with the Secretary
of State of Missouri in accordance with the provisions of Section 351.430 of the
Missouri Code. The Merger shall be effective at such time as the Articles of
Merger are duly filed with the Secretary of State of the State of Missouri in
accordance with Sections 351.435 and 351.440 of the Missouri Code or at such
later time as is specified in the Articles of Merger (the "Effective Time").
SECTION 1.03. CERTAIN EFFECTS OF THE MERGER. After the
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Effective Time of the Merger (i) the separate existence of Merger Sub ____ shall
cease and Merger Sub ____ shall be merged with and into the Company and (ii) the
Merger shall have all the effects set forth in Section 351.450 of the Missouri
Code.
SECTION 1.04. ARTICLES OF INCORPORATION AND BY-LAWS. The
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Articles of Incorporation and By-Laws of Merger Sub ___ as in effect immediately
prior to the Effective Time shall be the Articles of Incorporation and By-Laws
of the Surviving Entity until further amended or supplemented in accordance with
their respective terms and the provisions of the Missouri Code.
SECTION 1.05. DIRECTORS AND OFFICERS OF THE SURVIVING ENTITY.
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The directors and officers of Merger Sub ____ immediately prior to the Effective
Time shall be the directors and officers of the Surviving Entity, until their
respective successors are duly elected and appointed or until their earlier
death, resignation or removal.
ARTICLE II
EFFECT OF MERGER ON CAPITAL STOCK
OF THE CONSTITUENT ENTITIES
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SECTION 2.01. CONVERSION OF MERGER SUB__ STOCK. Pursuant to
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Section 3.1 of the Reorganization Agreement, at the Effective Time by virtue of
the Merger and without any action on the part of any of the parties, each issued
and outstanding share of common stock, par value $0.01 per share, of Merger Sub
___ shall be converted into and shall become one share of common stock of the
Company.
SECTION 2.02. CONVERSION OF THE COMPANY'S COMMON STOCK. Subject
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to the provisions of this Agreement and the Reorganization Agreement, at the
Effective Time each issued and outstanding share of common stock, par value
$0.01 per share, of the Company together with the associated rights issued
pursuant to the Company's Rights Agreement (the "Common Stock"), shall be
converted into, at the election of the holder thereof as provided in the
Reorganization Agreement, one of the following:
(a) for each such share of Common Stock with respect to which
an election to receive cash has been effectively made and not revoked or lost,
pursuant to Section 3.3 of the Reorganization Agreement (the "Cash Election"),
the right to receive in cash from Holding Company, without interest, an amount
equal to $____ (the "Cash Consideration");
(b) for each such share of Common Stock (other than shares as
to which a Cash Election has been made), the right to receive ____ share[s] of
Holding Company Common Stock (the "Stock Election").
If the percentage of shares of the Company's Common Stock outstanding
immediately prior to the Effective Time for which Stock Elections were made (the
"Stock Election Percentage") is equal to or greater than 80%, then all shares of
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the Company's Common Stock covered by Stock Elections shall be converted into
the right to receive shares of Holding Company Common Stock, and all shares of
the Company's Common Stock covered by Cash Elections shall be converted into the
right to receive the Cash Consideration.
If the Stock Election Percentage is less than 80%, then all shares of the
Company's Common Stock covered by Stock Elections shall be converted into the
right to receive shares of Holding Company Common Stock, and the shares for
which each holder made a Cash Election (the "Cash Election Shares") shall be
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treated as follows:
(x) Such holder shall be deemed to have made the Stock Election in respect
of a fraction (not greater than one) of such holder's Cash Election Shares, (i)
the numerator of which is the difference of 80% minus the Stock Election
Percentage, and (ii) the denominator of which is the percentage of shares of the
Company's Common Stock outstanding immediately prior to the Effective Time for
which Cash Elections were made; and
(y) The balance of such holder's Cash Election Shares shall be
converted into the right to receive the Cash Consideration.
SECTION 2.03. OTHER EFFECTS. The Merger shall have such other
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effects as provided in the Reorganization Agreement, including, but not limited
to, the conversion of options to purchase the Company's Common Stock as provided
in Section 3.5 of the Reorganization Agreement.
ARTICLE III
CLOSING CONDITIONS
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SECTION 3.01. CONDITIONS TO CLOSING. The obligations of the
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Company and Merger Sub ____ are subject to the satisfaction or waiver on or
before the Closing Date (as defined in the Reorganization Agreement) of all
agreements and conditions contained in the Reorganization Agreement.
ARTICLE IV
MISCELLANEOUS
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SECTION 4.01. AMENDMENT. This Agreement may not be amended except by
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an instrument in writing signed on behalf of both parties.
SECTION 4.02. GOVERNING LAW. This Agreement shall be governed
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by and construed in accordance with the internal laws of the State of Missouri,
without regard to its conflict of laws principles.
SECTION 4.03. DESCRIPTIVE HEADINGS. The descriptive headings
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herein are inserted for convenience of reference only and are not intended to be
part of or to affect the meaning or interpretation of this Agreement.
SECTION 4.04. COUNTERPARTS. This Agreement may be executed in
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counterparts, each of which shall be deemed to be an original, but all of which
shall constitute one and the same agreement.
SECTION 4.05. PARTIES IN INTEREST. This Agreement shall be
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binding upon and inure to the benefit of each party hereto and their respective
successors, and nothing in this Agreement, express or implied, is intended to
confer upon any other person any rights or remedies of any nature whatsoever
under or by reason of this Agreement.
SECTION 4.06. CAPITALIZED TERMS. All terms capitalized but not
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otherwise defined herein shall have the same meanings herein as in the
Reorganization Agreement.
IN WITNESS WHEREOF, each of the parties has caused this Agreement
to be executed on its behalf by its officers thereunto duly authorized, all as
of the day and year first above written.
[Agribrands International, Inc./Ralcorp Holdings, Inc]
By:______________________________
MERGER SUB _____
By:_____________________________