EXHIBIT B-4(i)(7)
FIRST AMENDMENT
TO
NOTE PURCHASE AND PRIVATE SHELF AGREEMENT
THIS FIRST AMENDMENT (the "First Amendment") TO NOTE PURCHASE
AND PRIVATE SHELF AGREEMENT (the "Agreement") is entered into
as of this 5th day of September, 1997, by and among GOLD KIST
INC., a cooperative marketing association organized and
existing under the laws of the State of Georgia (the
"Company"), and THE PRUDENTIAL INSURANCE COMPANY OF AMERICA
("Prudential") and PRUDENTIAL affiliates which are or may
become bound by the Agreement (together with PRUDENTIAL, the
"Purchasers").
W I T N E S S E T H:
WHEREAS, the Company and the Purchasers have entered into that
certain Agreement, dated as of February 11, 1997, (as amended,
restated or otherwise modified to the date hereof, the
"Agreement"; capitalized terms which are defined in the
Agreement and not otherwise defined shall be used herein with
the meanings ascribed to such terms in the Agreement); and
WHEREAS, the Company and the Purchasers desire to amend the
Agreement in the manner set forth below to allow the Company
to purchase the outstanding equity interests of Golden Poultry
Company, Inc. ("Golden Poultry") not now owned by it;
NOW, THEREFORE, for and in consideration of the mutual
premises, covenants and conditions contained herein, and other
good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, the parties hereto agree as
follows:
1.
Section 6B, Section 6C, Section 6D(xii) and Section 6F of the
Credit Agreement are hereby amended by replacing those
subsections in their entirety with the following text:
6. NEGATIVE COVENANTS. During the Issuance Period and so
long thereafter any Note or other amount due hereunder is
outstanding and unpaid, the Company covenants as follows:
* * *
6B. Limitation on Restricted Payments. The Company
covenants that it will not (i) pay or declare any dividend or
make any other distribution on or on account of any class of
its stock or other equity or make cash distributions of equity
(including cash patronage refunds), or (ii) make interest
payments on equity, or redeem, purchase or otherwise acquire,
directly or indirectly, any shares of its stock or other
equity, or (iii) redeem, purchase or otherwise acquire,
directly or indirectly, any Subordinated Debt, including, but
not limited to, its Subordinated Capital Certificates of
Interest, Subordinated Loan Certificates and Cumulative
Preferred Certificates of Interest (except required
redemptions as provided in the indentures pursuant to which
such Subordinated Debt was issued), or make any loans,
advances or investments in Golden Poultry other than as
permitted under clauses (xii) and (xvii) of paragraph 6D of
this Agreement or permit any Restricted Subsidiary to do any
of the above (all of the foregoing being herein called
"Restricted Payments") except out of Consolidated Net Earnings
Available for Restricted Payments; provided that the Company
shall not make any Restricted Payments upon the occurrence and
during the continuance of a Default or Event of Default. So
long as there is no Default or Event of Default occurring or
continuing, there shall not be included in the definition of
Restricted Payments: (x) dividends paid, or distributions
made, in stock of the Company or (y) exchanges of stock of one
or more classes of the Company, except to the extent that cash
or other value is involved in such exchange. The term
"equity" as used in this paragraph 6B shall include the
Company's common stock, preferred stock, if any, other equity
certificates, and notified equity accounts of patrons.
6C. Liens. The Company covenants that it will not, nor
will it permit any Restricted Subsidiary to, create, assume or
suffer to exist any Lien upon any of its property or assets
whether now owned or hereafter acquired, except:
(i) Liens existing prior to the date of this Agreement, as
set forth on schedule 6C attached hereto;
(ii) Liens for taxes not yet due, and Liens for taxes
or Liens imposed by ERISA which are being contest in good
faith by appropriate proceedings and with respect to which
adequate reserves are being maintained.
(iii) statutory Liens of landlords and Liens of
carriers, warehousemen, mechanics, materialmen and other Liens
imposed by law created in the ordinary course of business for
amounts not yet due or which are being contested in good faith
by appropriate proceedings and with respect to which adequate
reserves are being maintained;
(iv) Liens incurred or deposits made in the ordinary
course of business in connection with workers' compensation,
unemployment insurance and other types of social security, or
to secure the performance of tenders, statutory obligations,
surety and appeal bonds, bids, leases, government contracts,
performance and return-of-money bonds and other similar
obligations (exclusive of obligations for the payment of
borrowed money);
(v) Any Liens that constitute margin accounts set-off
arrangements made in connection with bona fide hedging
transactions, as defined in accordance with GAAP, in commodity
futures entered into in the ordinary course of business and
not for speculative purposes; and
(vi) Liens securing purchase money debt provided the
aggregate of such debt so secured does not exceed fifteen
percent (15%) of Consolidated Net Worth.
(vii) Liens encumbering securities of Archer-Daniels-
Midland Company, a Delaware corporation, owned by
Company.
6D. Restrictions on Loans, Advances, Investments and
Contingent Liabilities. The Company covenants that it will
not, nor will it permit any Restricted Subsidiary to, make or
permit to remain outstanding any loan or advance to, or extend
credit other than credit extended in the normal course of
business to any Person which is not an Affiliate of the
Company, or guarantee, endorse or otherwise be or become
contingently liable, directly or indirectly, in connection
with the obligations, stock or dividends of, or own, purchase
or acquire any stock, obligations or securities of, or any
other interest in, or make any capital contribution to, any
Person, except that the Company or any Subsidiary may:
* * *
(xii) purchase and hold all the outstanding capital
stock of Golden Poultry, it being agreed that the purchase
price of the capital stock of Golden Poultry not owned by
Company as the date hereof will not exceed $56,000,000.00.
6F. Merger and Sale of Assets. The Company covenants
that it will not, nor will it permit any Restricted Subsidiary
to, enter into any transaction of merger, consolidation,
pooling of interests, joint venture, syndicate or other
combination with any other Person except for Golden Peanut and
Young Pecan or sell, lease, transfer, contribute as capital,
or otherwise dispose of all or a substantial part of the
consolidated assets of the Company and all Subsidiaries or
assets which shall have contributed a substantial part of
Consolidated Net Earnings for any of the three fiscal years
than most recently ended, in any single transaction or series
of related transactions, to any Person, except that:
(i) any Subsidiary may merge with the Company, provided
that the Company shall be the continuing or surviving
corporation, or with any one or more other Restricted
Subsidiaries;
(ii) any Subsidiary may sell, lease or otherwise
dispose of any of its assets to the Company or another
Restricted Subsidiary;
(iii) the Company or any Restricted Subsidiary may enter
into any transaction of pooling of interests, joint venture,
syndicate or other combination with any other Person so long
as the aggregate investment of the Company and/or its
Restricted Subsidiaries does not exceed $5,000,000; and
(iv) any subsidiary may sell or otherwise dispose of
all or substantially all of its assets subject to the
conditions specified in paragraph 6E with respect to a sale of
the stock of such Subsidiary.
(v)any Subsidiary may merge with Golden Poultry; and
(vi) Company may sell securities of Archer-Daniels-
Midland Company, a Delaware corporation, owned by it.
2.
Use of Proceeds/Regulation G, Etc. The proceeds of the
Series A Notes will be used (i) to fund capital expenditures
and working capital needs, (ii) to acquire the portion of
equity interests of Golden Poultry not now owned by Company,
and (iii) for general working capital purposes. Neither of
the Company nor any agent acting on its behalf has taken or
will take any action which might cause this Agreement or the
Notes to violate Regulation G, T, U or X or (to their best
knowledge) any other regulation of the Board of Governors of
the Federal Reserve System, or to violate the Securities
Exchange Act of 1934, as amended, in each case as in effect
now or as the same may hereafter be in effect.
3.
The Agreement, as amended by the First Amendment, shall
remain in full force and effect in accordance with the terms
thereof in effect prior to this First Amendment to the extent
nor inconsistent with this First Amendment. The Agreement, as
amended by the First Amendment, is hereby reaffirmed and
restated on the date hereof; furthermore, nothing contained
herein shall be construed as a waiver or modification of
existing rights or obligations under the Agreement. From and
after the date hereof, references to the Agreement shall be
deemed to be references to the Agreement as amended to the
date hereof by the First Amendment.
4.
Company represents and warrants that all of the
representations and warranties set forth in Section 8 of the
Agreement are true and correct on the date hereof. No
"Default" or "Event of Default" has occurred and is continuing
as of the date hereof, and no "Default" or "Event of Default"
will occur as a result of the acquisition of the equity
interests of Golden Poultry.
5.
This First Amendment shall be binding on, and shall inure
to the benefit of, the parties hereto and their respective
successors and assigns.
6.
This First Amendment shall be governed by, and construed
in accordance with, the laws of the State of New York.
7.
This First Amendment constitutes the entire understanding
of the parties with respect to the subject matter hereof, and
any other prior or contemporaneous agreements, whether written
or oral, with respect thereto are expressly superseded hereby.
8.
This First Amendment may be executed in any number of
counterparts and by the different parties hereto on separate
counterparts, each of which when executed and delivered shall
be an original, but all of which shall together constitute one
and the same instrument.
IN WITNESS WHEREOF, the parties have caused this First
Amendment to be executed as of the day and year first above
written.
THE PRUDENTIAL INSURANCE
COMPANY OF AMERICA GOLD KIST INC.
By: /s/ Robert R. Derrick By: /s/ Stephen O. West
Vice President Stephen O. West
Treasurer
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