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SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934.
Date of Report (date of earliest event reported) May 12, 1998.
Broughton Foods Company
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(Exact name of registrant as specified in its charter)
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Ohio 0-23429 31-4135-025
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(State or other juris- (Commission File No.) (IRS Employer Identi-
fication No.) diction of corporation)
210 N. Seventh Street
P.O. Box 656
Marietta, Ohio 45750-0656
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (740) 373-4121
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Not Applicable
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(Former name or former address, if changes since last report)
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INFORMATION TO BE INCLUDED IN THE REPORT
Item 2. Acquisition or Disposition of Assets
On May 12, 1998, Broughton Foods Company ("Broughton"), an Ohio
corporation, announced that it had executed a Stock Purchase Agreement dated
May 12, 1998 with all the shareholders of LFD Holding Corp., a Delaware
corporation ("LFD"), providing for the purchase of all the issued and
outstanding capital stock of LFD for a cash price of approximately Nineteen
Million Dollars ($19,000,000.00). LFD owns 100% of the capital stock of
London's Farm Dairy, Inc., a Delaware corporation ("London's Farm") of Port
Huron, Michigan. Consummation of the acquisition is conditioned upon
satisfaction of the provisions of the Stock Purchase Agreement, including
expiration or termination of applicable waiting periods under the
Hart-Scott-Rodino Antitrust Improvements Act of 1976. Upon consummation of
such purchase, LFD and London's Farm will become wholly-owned subsidiaries of
Broughton and will continue operations as such. Broughton anticipates
utilizing its existing line of credit to provide the cash consideration
required by the Stock Purchase Agreement.
London's Farm processes milk, orange juice and cultured products in a
Port Huron, Michigan facility, and produces ice cream at a Burton, Michigan
plant.
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Item 7. Financial Statements and Exhibits
(c) Exhibits
The exhibits listed on the Exhibit Index on page 4 of this Form 8-K
are filed herewith.
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
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BROUGHTON FOODS COMPANY
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(Registrant)
/s/ Todd R. Fry
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Date: May 22, 1998 Todd R. Fry, Chief Financial Officer
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EXHIBIT INDEX
2.1 Stock Purchase Agreement among LFD Holding Corp., Broughton Foods
Company and the shareholders of LFD Holding Corp., dated as of May 12,
1998.
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EXHIBIT 2.1
STOCK PURCHASE AGREEMENT
THIS STOCK PURCHASE AGREEMENT (this "Agreement") is made and
entered into as of May 12, 1998 by and among LFD Holding Corp., a Delaware
corporation (the "Company"), Broughton Foods Company, an Ohio corporation (the
"Purchaser"), and the persons identified on the attached Schedule of Sellers
(each, a "Seller" and collectively, the "Sellers"). The Company, the Purchaser
and the Sellers are sometimes referred to herein as the "Parties". Unless
otherwise indicated, capitalized terms used but not defined prior to the first
usage herein are defined in Section 10.1.
WHEREAS, the authorized capital stock of the Company consists
of 200,000 shares of Class A Common Stock, par value $0.01 per share (the
"Class A Common"), 120,000 shares of Class B Common Stock, par value $0.01 per
share (the "Class B Common"), 12,500 shares of Class C Common Stock, par value
$0.01 per share (the "Class C Common," and together with the Class A Common and
the Class B Common, collectively, the "Common Stock") and 5,000 shares of
Preferred Stock, par value $0.01 (the "Preferred Stock," and together with the
Common Stock, the "Shares");
WHEREAS, the Company has issued options to acquire 4,961
shares of Common Stock (the "Options");
WHEREAS, the Sellers own beneficially and of record 100% of
the issued and outstanding Shares and Options, in each case in the amounts set
forth opposite each Seller's name on the Schedule of Sellers; and
WHEREAS, upon the terms and subject to the conditions set
forth in this Agreement, each Seller desires to sell to the Purchaser, and the
Purchaser desires to acquire from each Seller, all of the Shares owned by such
Seller.
NOW, THEREFORE, in consideration of the mutual covenants and
agreements made herein, and of the mutual benefit derived hereby, the Parties,
intending to be legally bound, agree as follows:
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ARTICLE I
PURCHASE AND SALE OF SHARES
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1.1 PURCHASE AND SALE OF THE SHARES. On the terms and subject to
the conditions set forth herein, at the Closing (as defined below), each Seller
shall sell to the Purchaser, and the Purchaser shall purchase from the Sellers,
the Shares, free and clear of any Liens.
1.2 THE BASE PURCHASE PRICE. For purposes of this Agreement, the
"Base Purchase Price" for 100% of the Shares shall be equal to:
(a) $19,000,000.00; minus
(b) the amount as of the Closing Date of Third
Party Debt owed by the Company and its subsidiaries, including any
prepayment penalties relating thereto.
1.3 THE CLOSING ESTIMATE. Not more than ten nor less than five
business days prior to the Closing Date, the Sellers shall, in good faith,
prepare and deliver to the Purchaser an estimate of Net Working Capital as of
the Closing Date (the "Sellers Estimated Working Capital"). Unless within the
2-day period following the Sellers' delivery of the Sellers Estimated Working
Capital the Purchaser tenders written notice to the Sellers setting forth any
and all items of disagreement related to the Sellers Estimated Working Capital,
the Sellers estimate of Net Working Capital shall be considered the final
estimate. If Sellers and Purchaser cannot agree on an estimate of the Net
Working Capital, such estimate will be deemed to be equal to the average of the
Sellers' and Purchaser's good faith determinations thereof. The amount of Net
Working Capital as finally estimated pursuant to this Section 1.3 is referred
to herein as the "Estimated Working Capital." For purposes of this Article I,
"Net Working Capital" means, with respect to the Company and its subsidiaries,
accounts receivables, inventory, prepaid expenses and other current assets
(other than cash) less trade accounts payable and other current liabilities
(excluding any current portion of Third Party Debt). All calculations of Net
Working Capital under this Agreement, whether estimates or otherwise, shall be
determined in accordance with GAAP.
1.4 THE PRELIMINARY PURCHASE PRICE. The "Preliminary Purchase
Price" shall be equal to (i) the Base Purchase Price, plus (ii) an amount,
which may be negative, obtained by subtracting $2,093,832.00 from Estimated Net
Working Capital.
1.5 THE CLOSING BALANCE SHEET AND CLOSING STATEMENT. Promptly,
but in any event within 90 days, after the Closing Date, the Sellers shall
prepare and deliver to the Purchaser a draft balance sheet as of the Closing
Date (the "Closing Balance Sheet") and a statement based thereon (the "Closing
Statement") setting forth the actual Net Working Capital as of the Closing Date
(the "Actual Net Working Capital"). Unless within the 25-day period following
the Sellers' delivery of the Closing Statement, the Purchaser tenders written
notice to the Sellers (the "Dispute Notice") setting forth any and all items of
disagreement related to the Closing Statement (each, an "Item of Dispute"), the
Closing Statement shall be conclusive and binding upon the Purchaser and the
Sellers. If the Purchaser delivers a Dispute Notice to the Sellers within such
25-day period, the Purchaser and the Sellers shall use reasonable efforts to
resolve their differences concerning the Items of Dispute, and if any Item of
Dispute is so resolved the Closing Statement shall be modified if necessary to
reflect such resolution. If any Item of Dispute remains unresolved after 15
days from the Sellers' receipt of the Dispute Notice, the Purchaser and the
Sellers shall jointly retain Price Waterhouse L.L.P. (the "Accounting Firm") to
resolve such remaining disagreement. The Purchaser and the
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Sellers shall request that the Accounting Firm render a determination as to
each unresolved Item of Dispute within 45 days of its retention, and the
Purchaser and the Sellers shall cooperate fully with the Accounting Firm so as
to enable it to make such determination as quickly and as accurately as
practicable. The Accounting Firm's determination as to each Item of Dispute
submitted to it shall be in writing, shall conform with Section 1.3, and shall
be conclusive and binding upon the Purchaser and the Sellers, and the Closing
Statement shall be modified if necessary to reflect such determination. The
Accounting Firm shall allocate its costs and expenses between the Purchaser and
the Sellers based upon the percentage which the portion of the contested amount
not awarded to each Party bears to the amount actually contested by such Party.
1.6 THE FINAL PURCHASE PRICE. The Final Purchase Price shall be
determined on the following date: (i) if a Dispute Notice is not tendered by
the Purchaser within the 25 days following delivery of the Closing Statement,
the second business day following the end of such 25-day period, or (ii) if a
Dispute Notice is properly tendered by the Purchaser, the second business day
following the final resolution pursuant to Section 1.5 of all Items of Dispute
specified in such Dispute Notice. The "Final Purchase Price" shall be equal to
(i) the Base Purchase Price, plus (ii) an amount, which may be negative,
obtained by subtracting $2,093,832.00 from Actual Net Working Capital, as set
forth in the Closing Statement (after modification pursuant to Section 1.5, if
any).
1.7 THE POST-CLOSING ADJUSTMENT PAYMENT.
1.7.1 PAYMENT BY THE PURCHASER. If the Final Purchase
Price is greater than the Preliminary Purchase Price, the Purchaser shall,
within five business days after the date the Final Purchase Price is determined
under Section 1.6, deliver to the Sellers a cashier's or certified check or
wire transfer of immediately available funds in an aggregate amount equal to
the Final Purchase Price minus the Preliminary Purchase Price (plus simple
interest on such difference at a rate of 6% per annum from the Closing Date
through the date of payment).
1.7.2 PAYMENT BY THE SELLERS. If the Final Purchase Price
is less than the Preliminary Purchase Price, the Sellers shall, within five
days after the date the Final Purchase Price is determined under Section 1.6,
deliver to the Purchaser an amount equal to the Preliminary Purchase Price
minus the Final Purchase Price (plus simple interest on such difference at a
rate of 6% per annum from the Closing Date through the date of payment). The
obligations of the Sellers under this Section 1.7.2 shall be several (and not
joint), based upon the Common Stock Percentages set forth on the Schedule of
Sellers.
1.8 ALLOCATION OF PURCHASE PRICE AMONG THE SELLERS. The
Preliminary Purchase Price shall be allocated among the Sellers in accordance
with the attached Allocation Schedule. Any payment to the Sellers under
Section 1.7.1 shall be allocated in accordance with the Common Stock
Percentages set forth on the Schedule of Sellers.
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ARTICLE II
THE CLOSING
2.1 THE CLOSING. The closing of the transactions contemplated by
this Agreement (the "Closing") shall take place at the offices of Kirkland &
Ellis, or at such other place as may be mutually agreeable to each of the
Parties, at 10:00 a.m., local time, on May 20, 1998, or two businesses days
after the conditions to Closing set forth in Article V have been satisfied or
waived, or at such other place or on such other date as may be mutually
agreeable to the Parties. The time and date of the Closing are referred to
herein as the "Closing Date." At the Closing, each Seller shall deliver to the
Purchaser share certificates evidencing the Shares, registered in the
Purchaser's or its nominee's name, upon payment of the Preliminary Purchase
Price. At Closing, Purchaser shall deliver to the Sellers (to the accounts
designated by the Sellers at least 5 business days before the Closing Date) the
Preliminary Purchase Price, to be allocated in accordance with Section 1.8,
upon delivery of the share certificates evidencing the Shares. Each Seller
hereby agrees that (a) 10% of the portion of the Preliminary Purchase Price
payable to such Seller in respect of such Seller's Common Stock shall be paid
into an account (as described in Section 6.5(a)(iv)) and (b) $200,000 in the
aggregate allocated among the Sellers in accordance with the Common Stock
Percentages set forth on the Schedule of Sellers from the portion of the
Preliminary Purchase Price payable to such Seller shall be paid into an account
(as described in Section 6.5(a)(v)).
ARTICLE III
REPRESENTATIONS AND WARRANTIES
3.1 REPRESENTATIONS AND WARRANTIES OF THE SELLERS. Each Seller,
with respect to itself and not jointly with respect to any of the other
Sellers, hereby represents and warrants to the Purchaser as of the date hereof
and as of the Closing Date as follows:
3.1.1 AUTHORIZATION. Such Seller has the power and
authority to execute and deliver this Agreement, to perform fully its
obligations hereunder, and to consummate the transactions contemplated hereby.
The execution and delivery by such Seller of this Agreement, and the
consummation of the transactions contemplated hereby, have been duly authorized
by all requisite corporate action of such Seller in the case of a Seller that
is a corporation or partnership. Such Seller has duly executed and delivered
this Agreement. This Agreement is a legal, valid and binding obligation of such
Seller, enforceable against it in accordance with its terms, except as such
enforceability may be limited by (a) applicable insolvency, bankruptcy,
reorganization, moratorium or other similar laws affecting creditors' rights
generally and (b) applicable equitable principles (whether considered in a
proceeding at law or in equity).
3.1.2 NO CONFLICTS. The execution, delivery and
performance by such Seller of this Agreement, and the consummation of the
transactions contemplated hereby, do not and will not conflict with or result
in a violation of or a default under (with or without the giving of notice or
the lapse of time or both) (a) any applicable law applicable to such Seller,
(b) the certificate of incorporation or by-laws or other organizational
documents of such Seller (in the case of a Seller that
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is a corporation or partnership) or (c) any material contract, agreement or
other instrument to which such Seller is a party or by which such Seller is
bound.
3.1.3 TITLES TO SHARES. Such Seller is the record and
beneficial owner of, and has good tide to, the Shares and Options set forth
opposite such Seller's name on the attached Schedule of Sellers, free and clear
of any and all Liens and any restrictions on transfer (other than restrictions
under the federal and state securities laws and other than pursuant to
agreements among the Sellers that will be terminated at Closing). Such Seller
is not a party to any option, warrant, purchase right or other contract or
commitment that could require the Seller to sell, transfer or otherwise dispose
of any capital stock of the Company (other than this Agreement and other than
pursuant to agreements among the Sellers that will be terminated at Closing).
Such Seller is not a party to any voting trust, proxy or other agreement or
understanding with respect to the voting of any capital stock of the Company,
other than pursuant to agreements among the Sellers that will be terminated at
Closing.
3.1.4 BROKERS, FINDERS, ETC. All negotiations relating to
this Agreement and the transactions contemplated hereby have been carried on
without the participation of any Person acting on behalf of such Seller in such
manner as to give rise to any valid claim against the Purchaser for any
brokerage or finder's commission, fee or similar compensation.
3.1.5 CAPITALIZATION. To such Seller's Knowledge, (a) the
Schedule of Sellers sets forth 100% of the equity holders of the Company
(together with 100% of the equity securities held by such holders), and (b) the
Company holds 100% of the stock of London's Farm Dairy, Inc., a Delaware
corporation.
3.2 REPRESENTATIONS AND WARRANTIES OF THE PURCHASER. The
Purchaser represents and warrants to the Sellers as of the date hereof and as
of the Closing Date as follows:
3.2.1 CORPORATE STATUS. The Purchaser is an Ohio
corporation duly organized, validly existing and in good standing under the
laws of the State of Ohio with all requisite corporate power and authority to
own, lease and operate its properties and to carry on its business as now being
conducted.
3.2.2 AUTHORIZATION. The Purchaser has the corporate power
and authority to execute and deliver this Agreement, to perform fully its
obligations hereunder, and to consummate the transactions contemplated hereby.
The execution and delivery by the Purchaser of this Agreement, and the
consummation of the transactions contemplated hereby, have been duly authorized
by all requisite corporate action of the Purchaser. The Purchaser has duly
executed and delivered this Agreement. This Agreement is a legal, valid and
binding obligation of the Purchaser, enforceable against it in accordance with
its terms, except as such enforceability may be limited by (a) applicable
insolvency, bankruptcy, reorganization, moratorium or other similar laws
affecting creditors' rights generally and (b) applicable equitable principles
(whether considered in a proceeding at law or in equity).
3.2.3 NO CONFLICTS. The execution, delivery and
performance by the Purchaser of this Agreement, and the consummation of the
transactions contemplated hereby, do not and will not
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conflict with or result in a violation of or a default under (with or without
the giving of notice or the lapse of time or both) (a) any applicable law
applicable to the Purchaser, (b) the certificate of incorporation or by-laws or
other organizational documents of the Purchaser or (c) any material contract,
agreement or other instrument to which the Purchaser is a party or by which the
Purchaser is bound, except that pursuant to Section 8.1 of a Credit Agreement,
dated as of March 30, 1998, between Purchaser and National City Bank, prior
written consent to the transaction contemplated by this Agreement must be
received from National City Bank, which consent Purchaser intends to seek.
3.2.4 AVAILABLE FUNDS. The funds on hand together with the
line of credit under the Purchaser's existing credit facility as described in
more detail on Purchaser's Financing Schedule are sufficient to pay the
Preliminary Purchase Price on the Closing Date and to make all other necessary
payments by it in connection with the transactions contemplated hereby.
3.2.5 BROKERS, FINDERS, ETC. All negotiations relating to
this Agreement and the transactions contemplated hereby have been carried on
without the participation of any Person acting on behalf of the Purchaser in
such manner as to give rise to any valid claim against any Seller for any
brokerage or finder's commission, fee or similar compensation.
ARTICLE IV
PRE-CLOSING COVENANTS
4.1 HSR ACT APPROVALS. The Purchaser and the Company shall each
file or cause to be filed with the Federal Trade Commission and the United
States Department of Justice any notifications required to be filed under the
HSR Act with respect to the transactions contemplated hereby. The Purchaser and
the Company shall bear the costs and expenses of their respective filings;
provided that the Purchaser shall pay all filing fees in connection with the
HSR Act.
4.2 PRE-CLOSING COVENANTS OF THE COMPANY.
4.2.1 CONDUCT OF BUSINESS. From the date hereof to the
Closing Date, except as expressly permitted or required by this Agreement or as
otherwise consented to by the Purchaser in writing (which consent shall not be
unreasonably withheld or delayed), the Company will:
(a) operate its business in the ordinary course;
and
(b) keep in full force and effect its corporate
existence.
4.2.2 PRE-CLOSING ACCESS AND INFORMATION. During the term
of this Agreement, the Company shall give the Purchaser and its accountants,
counsel, consultants, employees and agents, reasonable access, during normal
business hours and upon reasonable notice, to all documents and information,
with respect to the Company's properties, assets, books, contracts,
commitments, reports and records (except for confidential information or
privileged documents), as
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the Purchaser may from time to time reasonably request. In addition, the
Company shall permit the Purchaser and its accountants, counsel, consultants,
employees and agents, reasonable access to such personnel of the Company during
normal business hours and upon reasonable notice as may be necessary to the
Purchaser in its review of the properties, assets and business affairs of the
Company. Any such reviews and meetings will be arranged through
representatives of Key Equity Capital Corporation.
4.2.3 PRE-CLOSING ACTIONS.
(a) The Company shall use its reasonable efforts
to make the filings referred to in Section 4.1 promptly (and in any
event within five business days) following the date hereof, to respond
promptly to any requests for additional information made by any
applicable agencies and to cause the waiting periods under the HSR Act
to terminate or expire at the earliest possible date. In the event of
legal proceedings asserting that the transactions contemplated by this
Agreement constitute a violation of applicable antitrust or
competition laws, the Company shall be entitled to participate in such
proceedings at their own expense.
(b) Without limiting in any way the provisions of
subsection (a) above and Section 4. 1, from the date hereof to the
Closing Date, the Company will, as promptly as practicable, use
reasonable efforts to file or supply, or cause to be filed or
supplied, all applications, notifications and information required to
be filed or supplied by the Company pursuant to applicable law in
connection with this Agreement and the consummation of the other
transactions contemplated hereby, except for any such actions the
failure of which to take would not have a Material Adverse Effect.
(c) At all times prior to the Closing, the
Sellers shall promptly notify the Purchaser in writing of any fact,
condition, event or occurrence that will result in the failure of any
of the conditions contained in Sections 5.1 or 5.3 to be satisfied
promptly upon the Sellers becoming aware of the same.
4.3 PRE-CLOSING COVENANTS OF THE PURCHASER.
4.3.1 PRE-CLOSING ACTIONS.
(a) From the date hereof to the Closing Date, the
Purchaser agrees to use reasonable efforts to take all actions and to
do all things necessary, proper or advisable to consummate the
transactions contemplated hereby by the expected Closing Date.
(b) The Purchaser will use its reasonable efforts
to make the filings referred to in Section 4.1 promptly (and in any
event within five business days) following the date hereof, to respond
promptly to any requests for additional information made by any
applicable agencies and to cause the waiting periods under the HSR Act
to terminate or expire at the earliest possible date.
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(c) Without limiting in any way the provisions of
subsection (b) above and Section 4.1, from the date hereof to the
Closing Date, the Purchaser will, as promptly as practicable, use
reasonable efforts to file or supply, or cause to be filed or
supplied, all applications, notifications and information required to
be filed or supplied by the Purchaser pursuant to applicable law in
connection with this Agreement and the consummation of the other
transactions contemplated hereby, except for any such actions the
failure of which to take would not have a material adverse effect on
the financial condition or operating results of Purchaser.
(d) At all times prior to the Closing, the
Purchaser shall promptly notify Sellers in writing of any fact,
condition, event or occurrence that will or may result in the failure
of any of the conditions contained in Sections 5.1 and 5.2 to be
satisfied by the Purchaser promptly upon Purchaser becoming aware of
the same.
4.3.2 CONFIDENTIALITY. At all times prior to the Closing, the
Purchaser will treat and hold as such any confidential information it receives
from the Sellers, the Company or any of its Affiliates or any of their
respective agents or representatives in accordance with the terms of the
certain confidentiality agreement entered into between Purchaser and Key Equity
Capital Corporation dated as of January 23, 1998 (the "Confidentiality
Agreement").
ARTICLE V
CONDITIONS PRECEDENT
5.1 CONDITIONS TO OBLIGATIONS OF EACH PARTY. The obligations of
the Parties to consummate the transactions contemplated hereby shall be subject
to the fulfillment on or prior to the Closing Date of the following conditions:
5.1.1 HSR ACTION NOTIFICATION. In respect of the
notifications of the Purchaser and the Company pursuant to the HSR Act, the
applicable waiting period and any extensions thereof shall have expired or been
terminated.
5.1.2 NO INJUNCTION, ETC. Consummation of the transactions
contemplated hereby shall not have been restrained, enjoined or otherwise
prohibited by any order, injunction, decree or judgment of any court or other
Governmental Authority.
5.1.3 NO MATERIAL ADVERSE EFFECT. Since December 31, 1997,
there has occurred no fact, event or circumstance (including any litigation
matter) which has had or is reasonably likely to have a Material Adverse
Effect.
5.2 CONDITIONS TO OBLIGATIONS OF THE PURCHASER. The obligations
of the Purchaser to consummate the transactions contemplated hereby shall be
subject to the fulfillment on or prior to the Closing Date of the following
additional conditions:
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5.2.1 REPRESENTATIONS; COVENANTS. The representations and
warranties of the Sellers contained in Section 3.1 of this Agreement shall be
true and correct in all material respects at and as of the Closing Date and the
Sellers and the Company shall have duly performed and complied in all material
respects with all covenants, agreements and conditions required by this
Agreement to be performed or complied with by them prior to or on the Closing
Date.
5.2.2 FINANCING. The Purchasers shall have received the
financing for the transaction, as described in Section 3.2.4.
5.3 CONDITIONS TO OBLIGATIONS OF THE SELLERS. The obligation of
the Sellers to consummate the transactions contemplated hereby shall be subject
to the fulfillment, on or prior to the Closing Date, of the following
additional conditions:
5.3.1 REPRESENTATIONS, COVENANTS. The representations and
warranties of the Purchaser contained in Section 3.2 of this Agreement shall be
true and correct in all material respects at and as of the Closing Date and the
Purchaser shall have duly performed and complied in all material respects with
all agreements and conditions required by this Agreement to be performed or
complied with by it prior to or on the Closing Date.
5.3.2 RESOLUTIONS. The Purchaser shall have delivered to
the Sellers copies of the resolutions duly adopted by the Purchaser's board of
directors authorizing the execution, delivery and performance of this Agreement
and each of the other agreements contemplated hereby.
ARTICLE VI
OTHER COVENANTS AND AGREEMENTS
6.1 COVENANTS AND AGREEMENTS OF THE SELLERS.
6.1.1 FURTHER ASSURANCES. Following the Closing, the
Sellers shall from time to time execute and deliver such additional
instruments, documents, conveyances or assurances and take such other actions
as shall be necessary, or otherwise reasonably requested by the Purchaser, to
confirm and assure the rights and obligations provided for in this Agreement
and render effective the consummation of the transactions contemplated hereby.
6.2 COVENANTS AND AGREEMENTS OF THE PURCHASER.
6.2.1 FURTHER ASSURANCES. Following the Closing, the
Purchaser shall from time to time execute and deliver such additional
instruments, documents, conveyances or assurances and take such other actions
as shall be necessary, or otherwise reasonably requested by the Sellers, to
confirm and assure the rights and obligations provided for in this Agreement
and render effective the consummation of the transactions contemplated hereby.
6.2.2 POST-CLOSING ACCESS AND INFORMATION.
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(a) After the Closing Date, the Purchaser will
(and will cause each of its Affiliates and its Affiliates' respective
accountants, counsel, consultants, employees and agents to) give the
Sellers, and their accountants, counsel, consultants, employees and
agents, full access, during normal business hours and upon reasonable
notice, to all employees, documents, records, work papers and
information with respect to all of such Person's properties, assets,
books, contracts, commitments, reports and records relating to the
Company for a reasonable business purpose, as the Sellers may from
time to time reasonably request. In addition, the Purchaser shall
permit the Sellers to make copies at its own expense of any of the
above mentioned documents, records and information.
(b) The Purchaser will retain all books and
records relating to the Company in accordance with Purchaser's usual
and customary document retention policies.
6.3 EXPENSES.
(a) Except as otherwise provided herein (and
except with respect to the fees and expenses of the Company's
accountants for work performed at the written request of and for the
benefit of the Purchaser, which fees and expenses shall be the
responsibility of the Purchaser), the Sellers, on the one hand, and
the Purchaser, on the other hand, shall bear their respective
expenses, costs and fees (including attorneys' and accountants' fees)
in connection with the transaction contemplated hereby, including the
preparation, execution and delivery of this Agreement and compliance
herewith, whether or not the transactions contemplated hereby shall be
consummated.
(b) All transfer, documentary, sales, use, stamp,
registration, value-added and other taxes and fees, including any
penalties and interest thereon incurred in connection with this
Agreement (if any) shall be paid by the Purchaser when due.
6.4 CERTAIN AGREEMENTS AMONG THE SELLERS.
(a) Each Seller holding Options agrees as
follows: at the Closing, such Seller agrees that all unvested Options
will be automatically canceled without the payment of any
consideration and without any further action by any Person (including
such Seller and the Company).
(b) The Sellers identified on the Schedule 6.4(b)
issued promissory notes to the Company in connection with each such
Seller's purchase of securities from the Company. Each such Seller
agrees that his or her promissory note will be repaid using proceeds
from the sale of Shares to the Purchaser hereunder. Accordingly, each
Seller identified on the Schedule 6.4(b) directs the Purchaser to pay
to the Company (in complete satisfaction of such Seller's obligations
under such promissory notes), on such Seller's behalf, a portion of
the proceeds otherwise payable to such Seller equal to the outstanding
principal balance of such Seller's promissory note(s), together with
all accrued and unpaid interest thereon as of the Closing Date, all as
set forth on the Schedule 6.4(b).
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<PAGE> 12
(c) Effective as of the Closing Date, the Sellers
agree that the agreements listed on the Schedule 6.4(c) shall be
terminated and of no further force and effect.
(d) The determination of each Seller to enter
into this Agreement and to sell to the Purchaser all of the Shares
owned by such Seller pursuant to this Agreement has been made by such
Seller independent of any other Seller and independent of any
statements or opinions as to the advisability of such sale which may
have been made, given by or implied by the actions of any other Seller
or by any agent or employee of any other Seller. Each Seller has had
an opportunity to ask questions and receive answers concerning the
terms and conditions hereunder of the sale of the Shares owned by such
Seller and has had full access to such other information concerning
the Company and the terms and conditions of the sale of the Shares
owned by such Seller as he, she or it has requested. It is
acknowledged and agreed by each of the Sellers that, at the request of
the Sellers, Key Equity Capital Corporation has coordinated the
negotiations with the Purchaser of this Agreement and the other
documents and transactions contemplated hereby. In addition, it is
acknowledged and agreed by each of the Sellers that Key Equity Capital
Corporation has not acted on behalf of such Seller (as agent, advisor
or otherwise) in connection with the transactions contemplated hereby.
In consideration of Key Equity Capital Corporation's efforts, the
Sellers have agreed that the Company shall pay (i) a closing fee to
Key Equity Capital Corporation of $400,000.00 and (ii) the reasonable
costs, fees and out-of-pocket expenses incurred by or at the direction
of Key Equity Capital Corporation in connection with the transactions
contemplated hereby, including the reasonable fees and expenses of Key
Equity Capital Corporation's counsel, Kirkland & Ellis.
(e) By signing below, Earle T. Holsapple agrees
to indemnify each other Seller and hold harmless each other Seller
against any Loss which such Seller may suffer, sustain or become
subject to as a result of any amounts paid by such Seller under
Section 8.2.1(c) (solely to the extent related to matters described in
Section 1(b) of the Specified Claims Schedule).
6.5 APPOINTMENT OF REPRESENTATIVES.
(a) Powers of Attorney. Each of the Sellers
irrevocably constitutes and appoints Key Capital Corporation and John
F. Kirby (together, the "Representatives"), acting together or alone,
as such Person's true and lawful attorney-in-fact and agent and
authorizes the Representatives acting for such Person and in such
Person's name, place and stead, in any and all capacities to do and
perform every act and thing required or permitted to be done in
connection with the following transactions contemplated by this
Agreement, as fully to all intents and purposes as such Person might
or could do in person:
(i) to determine the Estimated Working
Capital in accordance with Section 1.3, prepare the
Closing Statement and Closing Balance Sheet and reach
agreement with Purchaser with respect to Actual Net
Working Capital as contemplated by Section 1.5 or
select an Accounting Firm to make a determination
thereof;
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<PAGE> 13
(ii) to determine the time and place of
Closing, determine whether the conditions to Closing
set forth in Article V have been satisfied (or to
waive such conditions), terminate this Agreement as
provided in Article VII and amend this Agreement to
extend the termination dates provided in Article VII;
(iii) to receive the Preliminary Purchase
Price on behalf of such Seller and to distribute such
funds in accordance with Section 1.8;
(iv) to retain 10% of the portion of the
Preliminary Purchase Price payable to such Seller in
respect of such Seller's Common Stock for the purpose
of contributing such amount into an account
established by Key Capital Corporation to provide
security for the Sellers obligations under Section
1.7.2 (and under the Specified Claims Schedule) (the
"Account") and to distribute such funds to the
Purchaser to the extent required under Section 1.7.2
(it being understood by each Seller that such
Seller's obligations under Section 1.7.2 could exceed
the amount set aside in the account);
(v) to retain an additional $200,000 in
the aggregate (allocated among the Sellers in
accordance with the Common Stock Percentages set
forth on the Schedule of Sellers) for the purpose of
contributing such amount to the Account from the
portion of the Preliminary Purchase Price payable to
such Seller in respect of such Seller's Common Stock
to provide security for the such Seller's
obligations, if any, pursuant to the attached
Specified Claims Schedule and to distribute such
funds in connection with any resolution of such
claims (it being understood by each Seller that such
Seller's obligations under the Specified Claims
Schedule could exceed the amount set aside in the
account);
(vi) upon the final determination of
Actual Net Working Capital and the payment of any
post-closing adjustment pursuant to Section 1.7 (and
all reasonable costs and expenses incurred in
connection therewith), to distribute any remaining
amounts in the account described in Section
6.5(a)(iv) to the Sellers in accordance with Section
1.8;
(vii) to receive notices of any claims
relating to the matters described on the Specified
Claims Schedule, to elect and, if elected, to assume
control of the defense of any such claims (including
the employment of counsel) to reach an agreement with
respect to or settle any proceeding relating to such
claims or to pay any amounts (including all
reasonable fees and expenses incurred in connection
therewith) from the account described in Section
6.5(a)(v) in respect of any such claims;
(viii) upon the belief of the
Representatives, acting together or alone, that the
issues relating to Section 1 of the Specified Claims
Schedule
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<PAGE> 14
have been (or are likely) resolved, to distribute any
remaining amounts in the account described in Section
6.5(a)(v) to the Sellers in accordance with the
Common Stock Percentages set forth on the Schedule of
Sellers (it being understood by each Seller that such
Seller's obligations under the Specified Claims
Schedule will not be affected by the release of such
amounts); and
(ix) to take any and all action on behalf
of such Person from time to time as a Representative
may deem necessary or desirable to fulfill the
interests and purposes of this Section 6.5(a).
Each of the Sellers grants unto said attorney-in-fact and agent full power and
authority to do and perform each and every act and thing necessary or desirable
to be done in connection with the matters described above, as fully to all
intents and purposes as the undersigned might or could do in person, hereby
ratifying and confirming all that the Representatives may lawfully do or cause
to be done by virtue hereof. Each of the Sellers further acknowledges and
agrees that upon execution of this Agreement, any delivery by the
Representatives of any waiver, amendment, agreement, opinion, certificate or
other documents executed by the Representatives pursuant to this Section 6.5,
such Person shall be bound by such documents as fully as if such Person had
executed and delivered such documents.
(b) Liability of the Representatives. No
Representative shall have by reason of this Agreement a fiduciary
relationship in respect of any Seller. No Representative shall be
liable to any Seller for any action taken or omitted by him hereunder
or under any other document hereunder, or in connection therewith,
except that no Representative shall be relieved of any liability
imposed by law for gross negligence or willful misconduct. No
Representative shall be liable to any Seller for any apportionment or
distribution of payments made by him in good faith, and if any such
apportionment or distribution is subsequently determined to have been
made in error the sole recourse of any Seller to whom payment was due,
but not made, shall be to recover from other Sellers any payment in
excess of the amount to which they are determined to have been
entitled. No Representative shall be required to make any inquiry
concerning either the performance or observance of any of the terms,
provisions or conditions of this Agreement. Each of the Sellers
acknowledges and agrees that the Representatives shall not be
obligated to take any actions and shall be entitled to take such
actions as the Representatives deem appropriate in such
Representatives' sole discretion.
(c) Actions of the Representatives. Each Seller
agrees that Purchaser shall be entitled to rely on any action taken by
the Representatives, on behalf of the Sellers, pursuant to Section
6.5(a) above (each, an "Authorized Action"), and that each Authorized
Action shall be binding on each Seller as fully as if such Person had
taken such Authorized Action.
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<PAGE> 15
ARTICLE VII
TERMINATION
7.1 ABILITY TO TERMINATE. The Parties may terminate this
Agreement as provided below:
(a) the Company, the Purchaser and the Sellers
may terminate this Agreement by mutual written consent at any time
prior to the Closing;
(b) the Purchaser may terminate this Agreement by
giving written notice to the Sellers if the Closing shall not have
occurred on or before June 12, 1998 by reason of the failure of any
condition precedent under Section 5.1 or 5.2 (unless the failure
results primarily from the Purchaser breaching any representation,
warranty, or covenant contained in this Agreement); and
(c) the Sellers may terminate this Agreement by
giving written notice to the Purchaser if the Closing shall not have
occurred on or before June 12, 1998 by reason of the failure of any
condition precedent under Section 5.1 or 5.3 (unless the failure
results primarily from the Sellers or the Company breaching any
representation, warranty, or covenant contained in this Agreement).
7.2 EFFECT OF TERMINATION. If any Party terminates this Agreement
pursuant to Section 7.1, all rights and obligations of the Parties hereunder
shall terminate without any liability of any Party to the other Party;
provided, however, that the provisions contained in Sections 4.3.2
(Confidentiality), 6.3 (Expenses), Article IX and (to the extent applicable)
Article X shall survive termination; and provided, further, that any
termination of this Agreement pursuant to subparagraphs (b) and (c) of Section
7.1 by reason of any breach of any representation and warranty or failure to
perform or comply with any covenant or other agreement contained herein shall
not relieve the breaching or defaulting Party from any liability for breach of
contract to the other Party hereto.
ARTICLE VIII
SURVIVAL, INDEMNIFICATION AND RELATED MATTERS
8.1 SURVIVAL.
8.1.1 POST CLOSING AGREEMENTS. The representations,
warranties, covenants and agreements set forth in this Agreement (other than in
Articles IV and V) shall survive the Closing. The covenants and agreements set
forth in Articles IV and V shall not survive the Closing.
8.1.2 NO RECOURSE. The Parties acknowledge and agree that,
except as specifically provided in Section 8.2, after the Closing, no claim or
action of any kind whatsoever shall be brought by any Party or any such Party's
Affiliates against, and no recourse shall be brought or granted against, any
other Party or such other Party's Affiliates by virtue of or based upon any
representation,
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<PAGE> 16
warranty, covenant or agreement set forth in this Agreement (including, without
limitation, any alleged misstatement or omission respecting any inaccuracy
therein or breach thereof).
8.2 INDEMNIFICATION.
8.2.1 BY THE SELLERS. After the Closing occurs, and subject
to the terms and provisions of this Agreement, each of the Sellers, with
respect to itself and not jointly with respect to any of the other Sellers,
will indemnify the Purchaser and hold it harmless against any Loss which the
Purchaser may suffer, sustain or become subject to as a result of:
(a) any failure of such Seller to perform any
covenant or agreement applicable to such Seller;
(b) any breach of or inaccuracy of any
representation or warranty by such Seller set forth in Section 3.1
above; and
(c) any amounts owed by such Seller pursuant to
the attached Specified Claims Schedule.
8.2.2 BY THE PURCHASER. After the Closing occurs, and
subject to the terms and provisions of this Agreement, the Purchaser and the
Company (jointly and severally) will indemnify each Seller and hold such Seller
harmless against any Loss which such Seller may suffer, sustain or become
subject to as a result of:
(a) any failure of the Purchaser to perform any
covenant or agreement applicable to the Purchaser;
(b) any breach of or inaccuracy of any
representation or warranty by the Purchaser set forth in Section 3.2
above;
(c) the failure to obtain any Consent or
Governmental Approval necessary to be obtained in connection with the
execution and delivery of this Agreement and the consummation of the
transactions contemplated hereby; and
(d) the ownership, use or operation of the
Company or its subsidiaries (or their respective businesses and
assets) by any Person and at any time, whether before or after the
Closing Date (it being understood that this subsection (d), in the
case of any Seller, shall not apply to any Losses arising out of any
fraudulent activities undertaken by such Seller).
8.3 LIMITATIONS ON INDEMNIFICATION. Neither the Purchaser, on one
hand, nor the Sellers, on the other hand, shall have any obligation to
indemnify the other Party against any breach of or inaccuracy of any
representation or warranty set forth in Article III, to the extent that the
other Party knew was breached or inaccurate as of the Closing.
8.4 EXCLUSIVE REMEDY; WAIVER AND RELEASE. The indemnification
provided under Section 8.2 for money damages shall be the Purchaser's and the
Sellers' sole and exclusive remedies,
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<PAGE> 17
each against the other, with respect to matters arising under this Agreement of
any kind or nature, or relating to the Company and the ownership, operation,
management, use or control of the Company, its subsidiaries and their
respective assets and operations.
8.5 ACKNOWLEDGMENT BY THE PURCHASER.
(a) The Purchaser has conducted, to its
satisfaction, an independent investigation and verification of the
financial condition, results of operations, assets, liabilities,
properties and projected operations of the Company and its
subsidiaries. In making its determination to proceed with the
transactions contemplated by this Agreement, the Purchaser has relied
on the results of its own independent investigation and verification
and the representations and warranties of the Sellers expressly and
specifically set forth in this Agreement, including the Schedules
attached hereto.
(b) WITHOUT LIMITING THE GENERALITY OF SECTION
8.1 OF THIS AGREEMENT, THE PURCHASER ACKNOWLEDGES AND AGREES THAT IT
IS NOT RELYING UPON ANY REPRESENTATION OR WARRANTY OF THE SELLERS
(OTHER THAN AS SET FORTH IN SECTION 3.1) OR ANY REPRESENTATION OR
WARRANTY OF THE SELLERS' OR THE COMPANY'S RESPECTIVE AFFILIATES,
AGENTS OR ADVISORS (INCLUDING, WITHOUT LIMITATION, ANY INFORMATION,
PROJECTION OR PROMISE CONTAINED IN ANY MATERIALS DELIVERED BY OR ON
BEHALF OF THE SELLERS OR THE COMPANY). EXCEPT AS SET FORTH IN SECTIONS
8.1, 8.2 AND 8.3, THE SELLERS ARE SELLING, AND THE PURCHASER IS
ACQUIRING, THE SHARES ON AN "AS IS, WHERE IS" BASIS.
8.6 ARBITRATION.
(a) The Parties shall attempt in good faith to
promptly resolve any dispute arising out of or relating to this
Agreement.
(b) If the dispute has not been resolved by
negotiation, then upon the written request of either Party, such
dispute shall be resolved by binding arbitration conducted in
accordance with the Rules of the Center for Public Resources ("CPR")
Institute for Dispute Resolution by a sole arbitrator. To the extent
not governed by such rules, such arbitrator shall be directed by the
Parties to set a schedule for determination of such dispute that is
reasonable under the circumstances. The arbitration will be conducted
in Cleveland, Ohio. The arbitration will be governed by the United
States Arbitration Act, 9 U. S.C. Sections 1 -16 and the Patent
Arbitration Act, 35 U.S.C. Section 294. Judgment upon the award
rendered by the arbitrator may be entered by any court having
jurisdiction.
(c) In the event the Parties have not resolved a
dispute pursuant to Sections 8.6(a) above, the Parties hereby
acknowledge and agree that such discussions shall be deemed in the
nature of settlement discussions and that neither the fact that the
discussions took place nor any statement or conduct of any participant
in such discussions shall be admissible into evidence in any
subsequent arbitration or other dispute resolution
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<PAGE> 18
proceeding involving the Parties, and any disclosure in any form,
including oral, by any person participating in such discussions shall
not operate as a waiver of any privilege, including attorney work
product or attorney client privilege.
ARTICLE IX
MISCELLANEOUS
9.1 SEVERABILITY. If any covenant, agreement, provision or term
of this Agreement is held to be invalid for any reason whatsoever, then such
covenant, agreement, provision or term will be deemed severable from the
remaining covenants, agreements, provisions and terms of this Agreement and
will in no way affect the validity or enforceability of any other provision of
this Agreement.
9.2 NOTICES. All notices, requests, demands, waivers and other
communication required or permitted to be given under this Agreement shall be
in writing and shall be deemed to have been duly given if (i) delivered
personally, (ii) sent by registered or certified mail, return receipt
requested, postage prepaid or (iii) sent by next-day or overnight mail or
delivery.
If to the Sellers:
To the addresses set forth on the attached Schedule of Sellers
with a copy (in the case of notices to Key Equity Capital Corporation or the
Representatives), which will not constitute notice to such Person to:
Kirkland & Ellis
200 East Randolph Drive
Chicago, Illinois 60601
Attn: Matthew E. Steinmetz
Fax No. (312) 861-2200
Confirm No. (312) 861-2356
If to the Company:
LFD Holding Corp.
2136 Pine Grove Avenue
Port Huron, Michigan 48060
Attn: President
Fax No. (810) 984-3139
Confirm No. (810) 984-5111
If to the Purchaser:
Broughton Foods Company
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<PAGE> 19
210 North Seventh Street
P. O. Box 656
Marietta, OH 45750
Attn: Philip Cline
Todd Fry
Fax No. (740 ) 376-9301
Confirm No. (800) 283-2479
with a copy, which will not constitute notice to the Purchaser, to:
Huddleston, Bolen, Beatty, Porter & Copen
611 Third Avenue
P. O. Box 2185
Huntington, West Virginia 25722-2185
Attn: Thomas J. Murray
Fax No. (304) 522-4312
Confirm No. (304) 529-6181
or, in each case, at such other address as may be specified in writing to the
other Parties.
All such notices, requests, demands, waivers and other communications shall be
deemed to have been received (i) if by personal delivery on the date after such
delivery, (ii) if by certified or registered mail, on the seventh business day
after the mailing thereof (iii) if by next-day or overnight mail or delivery,
on the day delivered provided that an additional copy is also sent by telecopy
(with confirmation of receipt).
9.3 ENTIRE AGREEMENT. This Agreement (including the Schedules
hereto), the Confidentiality Agreement and other documents contemplated hereby
(when executed and delivered) constitute the entire agreement and supersede all
prior agreements and understandings, both written and oral, between the Parties
with respect to the subject matter hereof.
9.4 COUNTERPARTS. The Parties may execute this Agreement in
separate counterparts (no one of which need contain the signatures of all
Parties), each of which will be an original and all of which together will
constitute one and the same instrument.
9.5 GOVERNING LAW, ETC. This Agreement will be governed by and
construed in accordance with the domestic laws of the State of Ohio, without
giving effect to any choice of law or conflict provision or rule (whether of
the State of Ohio or any other jurisdiction) that would cause the laws of any
jurisdiction other than the State of Ohio to be applied. In furtherance of the
foregoing, the internal law of the State of Ohio will control the
interpretation and construction of this Agreement, even if under such
jurisdiction's choice of law or conflict of law analysis, the substantive law
of some other jurisdiction would ordinarily apply.
9.6 BINDING EFFECT. This Agreement shall be binding upon and
inure to the benefit of the Parties and their respective successors and
permitted assigns.
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<PAGE> 20
9.7 ASSIGNMENT. This Agreement shall not be assignable or
otherwise transferable by any Party hereto without the prior written consent of
the other Party hereto.
9.8 NO THIRD PARTY BENEFICIARIES. Nothing in this Agreement shall
confer any rights upon any person or entity other than the Parties and their
respective successors and permitted assigns and Key Capital Corporation and
John F. Kirby in the case of Section 6.5.
9.9 PRESS RELEASES AND PUBLIC ANNOUNCEMENTS. No Party shall issue
any press release or make any public announcement relating to the subject
matter of this Agreement prior to the Closing without the prior written
approval of the other Party.
9.10 AMENDMENT, WAIVERS, ETC. No amendment, modification or
discharge of this Agreement, and no waiver hereunder, shall be valid or binding
unless set forth in writing and duly executed by the Party against whom
enforcement of the amendment, modification, discharge or waiver is sought. Any
such waiver shall constitute a waiver only with respect to the specific matter
described in such writing and shall in no way impair the rights of the Party
granting such waiver in any other respect or at any other time. Neither the
waiver by any of the Parties of a breach of or a default under any of the
provisions of this Agreement, nor the failure by any of the Parties, on one or
more occasions, to enforce any of the provisions of this Agreement or to
exercise any right or privilege hereunder, shall be construed as a waiver of
any other breach or default of a similar nature, or as a waiver of any of such
provisions, rights or privileges hereunder.
9.11 CAPTIONS. The captions used in this Agreement are for
convenience of reference only and do not constitute a party of this Agreement
and will not be deemed to limit, characterize or in any way affect any
provision of this Agreement, and all provisions of this Agreement will be
enforced and construed as if no caption had been used in this Agreement.
9.12 NO STRICT CONSTRUCTION; INTERPRETATION. The language used in
this Agreement will be deemed to be the language chosen by the Parties to
express their mutual intent and no rule of strict construction will be applied
against any Person.
ARTICLE X
DEFINITIONS
10.1 DEFINITION OF CERTAIN TERMS. The terms defined in this
Section 10.1, whenever used in this Agreement (including in the Schedules),
shall have the respective meanings indicated below for all purposes of this
Agreement:
"Affiliate" of a Person means a Person that directly or
indirectly through one or more intermediaries, controls, is controlled by, or
is under common control with, the first Person. "Control" (including the terms
"controlled by" and "under common control with") means the possession, directly
or indirectly, of the power to direct or cause the direction of the management
policies of a person, whether through the ownership of voting securities, by
contract or credit arrangement, as trustee or executor, or otherwise.
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<PAGE> 21
"Agreement" means this Stock Purchase Agreement, including the
Schedules hereto.
"Consent" means any consent, approval, authorization, waiver,
permit, grant, franchise, concession, agreement, license, exemption or order of
registration, certificate, declaration or filing with, or report or notice to,
any Person, including but not limited to any Governmental Authority.
"GAAP" means United States generally accepted accounting
principles, applied on a basis consistent with the preparation of the Company's
December 31, 1997 audited financial statements.
"Governmental Approval" means any Consent of any Governmental
Authority.
"Governmental Authority" means any nation or government, any
state or other political subdivision thereof.
"HSR Act" means the Hart-Scott-Rodino Antitrust Improvements
Act of 1976, as amended, and rules and regulations promulgated thereunder.
"Lien" means any mortgage, pledge or security interest.
"Loss" means any loss, liability, deficiency, damage or
expense.
"Material Adverse Effect" means a material adverse effect on
the financial condition or operating results of the Company and its
subsidiaries (taken as a whole).
"Person" means an individual, a partnership, a corporation, an
association, a limited liability company, a joint stock company, a trust, a
joint venture, an unincorporated organization and a Governmental Authority.
"reasonable efforts" means reasonable efforts which are
commercially reasonable under the circumstances, excluding the payment of any
money or other consideration to any third party or the commencement of any
litigation or arbitration.
"Third Party Debt" means any indebtedness for borrowed money.
For clarification, Third Party Debt also shall not include any obligations
under capital leases.
10.2 OTHER DEFINITIONAL PROVISIONS.
(a) Accounting Terms. Accounting terms (if any)
which are not otherwise defined in this Agreement have the meanings
given to them under GAAP. To the extent that the definition of such
accounting term that is defined in this Agreement is inconsistent with
the meaning of such term under GAAP, the definition set forth in this
Agreement will control.
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<PAGE> 22
(b) "Hereof," etc. The terms "hereof," "herein"
and "hereunder" and terms of similar import are references to this
Agreement as a whole and not to any particular provision of this
Agreement. The term "including" as used in this Agreement is used to
list items by way of example and shall not be deemed to constitute a
limitation of any term or provision contained herein. As used in this
Agreement, the singular or plural number shall be deemed to include
the other whenever the context so requires. Section, clause and
Schedule references contained in this Agreement are references to
Sections, clauses and Schedules in or to this Agreement, unless
otherwise specified.
(c) Successor Laws. Any reference to any
particular law or regulation will be interpreted to include any
revision of or successor to such law or regulation regardless of how
it is numbered or classified.
* * * * *
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<PAGE> 23
IN WITNESS WHEREOF, the Parties have duly executed this Stock
Purchase Agreement as of the date first above written.
LFD HOLDING CORP.
By: /s/ Karen M. Earley
----------------------------------------------------
Name: Karen M. Earley
--------------------------------------------------
Its: Secretary
---------------------------------------------------
BROUGHTON FOODS COMPANY
By: /s/ Marshall T. Reynolds
----------------------------------------------------
Name: Marshall T. Reynolds
--------------------------------------------------
Its: Chairman
---------------------------------------------------
SELLERS
KEY EQUITY CAPITAL CORPORATION
By: /s/ J.F. Kirby
----------------------------------------------------
Name: J.F. Kirby
--------------------------------------------------
Its: General Partner
---------------------------------------------------
/s/ Bela Szigethy
-------------------------------------------------------
Bela Szigethy
/s/ Alan Walther
--------------------------------------------------------
Alan Walther
/s/ Robert Wainio
--------------------------------------------------------
Robert Wainio
[Signature page to the Stock Purchase Agreement]
<PAGE> 24
BANK OF AMERICA ILLINOIS, AS TRUSTEE FOR THE KEVIN R. EVANICH
IRA ROLLOVER TRUST
By:/s/
------------------------------------------------------------
Its: Vice President
-----------------------------------------------------------
/s/ Karen Earley
--------------------------------------------------------------
Karen Earley
/s/ Tom Laudenslager
---------------------------------------------------------------
Tom Laudenslager
/s/ Darrell Austin
---------------------------------------------------------------
Darrell Austin
/s/ Earle T. Holsapple
---------------------------------------------------------------
Earle T. Holsapple
